Understanding Milan's revenue from the new UCL format [Bonus Article]

The most prestigious club competition is about to kick off, namely the Champions League, and it will do so with a completely new format. Of course, this trophy will always be very special for AC Milan given just how much it has meant for the club, even if some might not like the new format. The specifics of the latter aside, though, what is the new financial structure and how much will the Rossoneri get?

The Champions League has always been described as a saviour of sorts for Serie A clubs, incapable of even attempting to compete with Premier League clubs without this added revenue. €40m has generally been thrown around as a guaranteed figure excluding the potential bonuses of winning and going far, but some might wonder what the situation looks like with the new format.

We will get into the nitty-gritty of the financials in this article, but the good news is that the guaranteed figure has actually increased. This is very understandable as the number of games has increased as well, with each team playing at least eight games (instead of six) in the new league phase. To that, we must also add the two-legged knockout phase playoff, so it will be ten games for some.

The total prize pot from the league phase onwards is a whopping €2.437bn, which is higher than the previous €2.002bn. In previous financial articles about the Champions League, we have also highlighted the so-called historical ranking and market pools a lot in terms of how the revenue is distributed. The former is exactly what it sounds like, while the latter is related to TV revenue and the club’s final position in the domestic league the previous season.

However, with the new format, these two ‘pillars’ have been bundled and slightly modified to form the ‘newly created value pillar’, as UEFA describes it. Before getting into the exact explanation of each of them, let’s take a look at the total amounts and the three different distribution pillars:

• 27.5% will be allocated to equal shares (starting fee) (€670m)

• 37.5% will be allocated to performance-related fixed amounts (€914m)

• 35% will be allocated to the newly created value pillar (€853m)

The revenue pillars explained

Let’s start, fittingly enough, with the starting fee. This is a pillar that hasn’t changed compared to the previous edition of the Champions League, simply increasing in value (from €500.5m). Each of the 36 clubs in the league phase will get €18.62m just for qualifying, which is slightly higher than the €15.64m figure from last season. Of course, this is not the only guaranteed revenue.

Skipping the performance-related amounts for now, as it’s certainly not guaranteed revenue, let’s take a look at the new pillar. It’s a combination of the previous market pools and historical (coefficient) ranking, as already stated, and it has now been split into a ‘European part’ and a ‘non-European part’. In short, this relates to the sale of TV rights in these regions and how much the clubs ‘contribute’ to this.