IS NEWCASTLE BRINGING MONEYBALL TO THE PREMIER LEAGUE?

Derek Llambias is unlikely ever to be played by Brad Pitt in a movie. But there are signs Newcastle United's early success this Premier League season owes something to the Oakland A's' stingy strategy currently being immortalized in a blockbuster movie starring Pitt, based on the book whose title made "Moneyball" an American word for winning big on a small budget in baseball and in life.

No one's written an insider book detailing Newcastle's scouting philosophy, so it's hard to know how United has been able to target apparent steals like Hatem Ben Arfa, Yohan Cabaye, Sylvain Marveaux and Mehdi Abeid before other Premier League clubs. It's not hard, though, to see parallels between economic conditions in Major League Baseball and Premier League soccer that made such steals possible, and parallels between Oakland's and Newcastle's responses to those conditions.

Thanks to competition-balancing mechanisms like reverse-order-of-finish player drafts, salary caps, spending "taxes" and guaranteed contracts, rich clubs in baseball and other American professional sports have been unable to lock the upper floors of their leagues as tightly as in the Premier League. However, the rich Premier League clubs haven't been as successful at buying victory as it may seem at first glance. In researching the history of the Premier League table while trying to predict whether Newcastle's fast start to this season is for real, it struck me that while only five Premier League clubs are spending above the league average for players, eight or nine are still staying above the league average in points. The rich clubs are managing to win, but the overall table isn't as distorted as the budgets. As in baseball, much of the money going to big player salaries in the Premier League is wasted. That's because money isn't brains: every player has a price, but no amount will guarantee the player is worth it.

There being only so much space in the league for soccer players, big-name auctions create a depressed market for small names, and an opportunity for bargain hunting if scouting is sharp. That was Oakland's strategy in 2002; that's Newcastle's strategy in 2011. It's easy to dismiss it as mere cheapness borne of necessity, and there may be truth in that. On the other hand, where modestly financed clubs go most seriously wrong, in baseball and in soccer, is when they participate against richer clubs in marquee auctions. When big clubs buy the inevitable clunker in an auction, they go on to the next auction. Smaller clubs suffer the hangover for years.

So as loath as we may be to admit it, there's logic when a club like Newcastle, in its current stage of economic recovery, places what can feel like an overly strict quarantine between itself and spendy players. While the freer market of soccer means bargain-hunting is unlikely to get Newcastle to title contention as it did with Oakland in baseball, it seems like the right way to get to the door of the penthouse, where Newcastle stands right now.

Moneyball isn't easy, and it isn't always fun, especially for us fans, who tend to be impatient. It requires an eye for talent so sharp that Hollywood can make a movie out of it. But so long as Newcastle can identify and sign the Yohan Cabayes of the world, the club will continue making its thrift-hating supporters eat very sweet helpings of crow.

Comments

[Phil K]

Good article, and interesting.

[Nickjdoggett]

Great Article Bob. It would be interesting to see those distortions of position v spending and who is make the most of their squad value / spending

[Bob M]

Wow, first I have to say this was excellent post. I certainly do hope that someone has figured out the secret of finding the best players for the lowest cost as it's working so far.

I remembered reading the following article awhile ago:
http://www.slate.com/articles/sports/sports_nut/2011/01/numberless_wonders.single.html

The basic gist is that you probably can't do the same thing for Soccer because the game is too complex and the important things can't be broken down into stats.

[AndyB]

Well said Bob. Welcome aboard the small but growing, post transfer deadline day neorealistic newcastle united supporters club ... new members welcome.

[M]

As someone who regularly follows the NBA and the NFL, I'm quite familiar with the American style of sports consumption and it's great to read this kind of perspective applied to my favourite subject - Newcastle United!

Keep up the good work Bob - thoroughly enjoy your posts

[DW Graham]

I have been thinking of this for the last year. Moneyball and soccernomics are an approach that works for awhile and I am fairly sure that Newcastle has been "secretly" using this approach. However, the approach ultimately collapses and does not work in the long run, which was/is the case with Oakland (where moneyball comes from). Moneyball generates decent, but relatively short term success.

On the otherhand, using this approach to "right the ship" is a smart idea; however, to have "big" success, you need to spend money. You cannot obtain world class players via moneyball methods and, by definition, you will lose your best players as soon as they become valuable enough to teams with no spending limits. Therefore, this approach generates slightly better than average, but profitable teams.

[Bob]

You're right - moneyball won't get a club past a certain point in the Premier League where the wealth disparity is so large and no competitive protections are in place. No amount of bargain buys will crack the top PL echelon because that echelon is simply too far above the others. In baseball, though, moneyball still works - the main reason Oakland has fallen is nearly every baseball club is playing moneyball now and Oakland's competitive advantage has vanished. Look at the clubs that just made baseball's 2011 playoffs: of 30 teams, the payrolls rank 1st, 2nd, 10th, 11th, 13th, 17th, 25th and 29th - there's only a mild correlation left in baseball between payroll and winning, and that's due to what Oakland started with moneyball.

With Newcastle, the issue is whether the club can ever be rich enough to spend with the big clubs, or whether "best of the rest" is the only reasonable goal. That's a complex question of economics and demographics, not just soccer.

[DW Graham]

Yes I agree, and the other issue with moneyball was when other teams "got it", Oakland had to become very clandestine relative to looking at players. Other teams started to watch Oakland and then poached the best players within Oakland's reach, which I think may be what happened at the transfer window this year with Newcastle. Newcastle found and signed relative bargains early in the summer, but when bidding started in August, they lost their quietly targeted players because they were not willing to pay.

[Ryan]

Great read. According to Ashley and Llambias, at some point we should be able to spend more. I know we have a wage structure in place, but when Newcastle is making a nice profit, why not reinvest the money if you have it? That's the biggest question in my mind. If we can continuously be around the top 8, and start making a healthy profit and have more to spend, then will the wage cap rise too? it would make sense.

Llambias has said the plan is for NUFC to be able to "wipe it's own nose." If that happens and a Shearer like striker becomes available, we should be able to bid for him at least. If there will always be a wage structure regardless of how much we are making, that is Ashley's choice. But as Bob said, Moneyball only gets you so far. The Athletics do great at utilizing talent and great value, but they are never series World Series contenders either.