Are United on road to success?

May 24 2008 by Dan Warburton, The Journal

IT is exactly 12 months ago today that Mike Ashley forked out £55.3m for Sir John Hall’s stake in Newcastle United.

On May 24 2007, the billionaire sports tycoon began his takeover of the club – and was touted as the man who could bring success to the Magpies after years of underachievement under Sir John, his son Douglas and Freddie Shepherd. Billed as a reclusive businessman who would shy away from the media spotlight, the following 12 months revealed him to be anything but.

Making regular appearances amidst the fans on matchdays and convention-busting shows sporting his Toon shirt in the director’s box, Ashley has hardly kept a low profile. And while shunning interviews, he was spotted in clubs buying the entire bar drinks, a folk hero in the making.

So what sort of difference has a year made?

Manager Sam Allardyce was removed having failed to set Tyneside alight and Ashley pulled a masterstroke – securing the return of the Messiah, Kevin Keegan.

But after a respectable recovery from a dire run of results to finish mid table, and the imminent departure of chairman Chris Mort, uncertainty again surrounds the club.

Here, The Journal’s Dan Warburton speaks to analysts, city leaders and fans to get their verdict on Ashley’s first year in charge.

------------------------------------------------------------------

Team will need huge investment

THE ANALYST

Tom Cannon, professor of sports finance, at Buckingham University

WHILST Newcastle fans enjoy Ashley’s heavyweight spending power, there are those who doubt his commitment to the club.

According to Tom Cannon, professor of sports finance at Buckingham University, for aspirations of on-the-pitch success and a top-four finish to be realised, huge investment is required.

He says that for the North East club to break the stranglehold of the top four teams they will need to spend £40m more each season than Manchester United, Chelsea, Arsenal and Liverpool.

And he believes it’s revenue that Ashley does not appear willing to part with. Prof Cannon said: "It’s still very early stages for Mike Ashley. The truth is that the jury is still out.

"I generally agree with Keegan. The gap between the top four and the rest of the league is constantly being stretched, and you have to spend enormous amounts of money to bridge that.

"That is the biggest question over Mike Ashley. He has not shown the same inclination to throw the same amount of money at the team as the foreign owners.

"It’s like a race. If you are a hundred yards behind someone then you need to match their pace and then beat it. There is no sign yet that he is willing to bridge the gap."

When Ashley bought the club, he took the unusual step of appointing Chris Mort as Chairman.

But Prof Cannon believes that in order to be successful, more clearly defined roles need to be laid out with a clear leader in charge.

He said: "Most management theories suggest that there should be clear lines of control.

"If you own the club, you should Chair the club. If you want to make a successful club, you need to have one person in charge and that’s a problem for Newcastle. Mike Ashley has not always been a fan, despite the fact that he wears a black and white shirt and stands with the fans.

"He sees it as a business, and if we are honest, providing they stay in the Premiership and they are in contention for trophies, then there is always the potential he will make money.

"But taking Newcastle into the top four is a full-time job for one person. I’m not sure that a man with his other enterprises, or business interests, has the time to do that.

"I believe he has the ability, but the question is will he give it the time, given all his other interests."

Earlier this year, Ashley’s Sports Direct retail empire agreed a strategic alliance with the Chinese ITAT Group which would see his brands sold at 120 of the Chinese firm’s stores.

A surge in on-the-field success by Newcastle United would see greater prominence given to replica shirt sales in the Chinese store, but Prof Cannon is unsure of the viability of trading in the Asian market.

He said: "There is such little concept of copyright laws in Asia that people don’t feel they should pay money for merchandise.

"There is some evidence that teams like Manchester United are starting to make money in Asia, but it is mainly for their academies and their tournaments."

Page 2: The City Leader / The Rival / The Player / The Newcastle Fan / The Business Voice