In a recent development at FIFA's annual law conference in Tokyo, FIFA president Gianni Infantino has once again brought up the idea of using algorithms to determine football transfer fees. This concept, which has been circulating for a few years now, aims to increase transparency and standardize the valuation process in the global transfer market, which currently exceeds $10 billion annually.
Infantino believes that discussing the use of algorithms to estimate the fair value of transfer fees is of utmost importance for the football community. By implementing such a system, the intention is to assist football stakeholders in negotiating transfer deals and potentially curbing exorbitant fees.
However, the implementation of a FIFA-approved algorithmic method for setting transfer fees poses certain challenges. It remains uncertain how clubs, who would have limited selling options under this system, would respond to the new approach. Moreover, it remains to be seen how such a system would comply with competition laws within the European Union (EU). A recent ruling by the EU's court of justice in the Super League case exemplified the limited regulatory power of football bodies such as UEFA and FIFA.
Although FIFA has expressed interest in a price-setting algorithm for transfer fees, no concrete proposal has been put forward since the establishment of a transfer task force in 2017. This task force included delegates from clubs, leagues, and player unions. The lack of progress in implementing this method is evident, despite high-profile transfer deals, such as Neymar's move from Barcelona to Paris Saint-Germain for a record-breaking fee of €222 million ($241 million) in 2017, and Kylian Mbappé's transfer to PSG from Monaco for €180 million ($196 million) shortly after.
Interestingly, FIFA has invested significant resources in supporting a masters course and football research unit at the University of Neuchâtel in Switzerland. This institution has been working on a transfer value algorithm since 2010. The International Centre for Sports Studies (CIES), associated with the university, has even valued players like Real Madrid's Jude Bellingham, Vinícius Júnior, and Manchester City's Erling Haaland at a minimum of €250 million ($272 million) using their research method. This approach takes into account factors such as a player's age, length of contract, international record, and the global economic context.
It is worth noting that Transfermarkt, a popular football industry website, provides lower valuations for these same players. According to Transfermarkt, Bellingham, Haaland, and Mbappé are currently valued at €180 million ($196 million), which is significantly lower than the algorithm-generated valuations.
As the debate over the use of algorithms to determine football transfer fees continues, it remains to be seen whether FIFA can eventually find a middle ground that satisfies all stakeholders. The potential benefits of increased transparency and fairness are evident, but the practicality and legal implications of such an approach require careful consideration. Only time will tell if this innovative idea will become a reality in the world of football.
