1.- Sport income, or match day revenues: everything resulting from the sport activity, such as day tickets, season tickets, club memberships, also sport prizes and other money achieved in the stadium (VIP lounge, etc). This income is normally of a local nature.
2.- TV rights: the money clubs collect in exchange of their match image rights, either in their national leagues or in the Champions League. Frequently it spans multiple seasons, and in many cases clubs have little to negotiate since it is all agreed upon between broadcasters and the Leagues (i.e. Bundesliga, Premier League... but also UEFA for the Champions League). With the expansion of the streaming technology over the internet, cable or satellite TV, new sources of revenue are appearing for clubs.
3.- Marketing and Merchandise: that's sponsoring, sales of T-shirts, image rights, and other stuff. Normally this is referred to as worldwide sales.
Needless to say this business is about brand management, and that's normally carried out by the clubs piggybacking on their player's own brand management efforts on the pitch (and out of it). This reinforces the idea that football is nowadays a virtuous circle in which the clubs collecting more talent are the ones making more revenue, which brings the ability to bring in more talent.
There always was competitiveness in the national leagues, and it took a great deal of effort every weekend to win the championship and earn the glory of representing the country in the champions league. Due to this virtuous circle the gaps between prime and regular teams in the national divisions has become so big that the chances of having smaller teams winning their leagues is practically non existing. When you have a look at the American professional sports and see that they capped their salaries and introduced a draft system to pull in young players from the lower divisions, you cannot but admit that what they did indeed is to democratise the chances of victory of all teams an therefor multiply the chances of a competitive league which everyone has chances to win. It's a completely different system from its root to its tip, and leaning to it would involve a radical change in the concept of European football as we understand it today.
Excursion:
The Spanish Parliament passed a debate today about the debt of the Spanish football clubs towards the state IRS: 0.75 Billion €, about one half of their total income for one season, and that does not cover the social security charges for players' salaries. The total amount is simply unknown or "not-to-be-disclosed". If you take into account that Spain is currently facing a 35 Billion Euro cut in their public expenditure for this year, cashing in those receivables would certainly help in relieving much of the pain that public services will walk through in the coming months. Alas, history shows that population is more prone to demonstrate in the streets for their football clubs that what they are for economic reasons, unless it gets to an extreme.
FC Barcelona is one of the strongest debtors, by the way, and they may incur into big trouble, should the state insist in their paying back their debt. If FC Barcelona was to disappear as a club for financial reasons, their internal norms mention that the remaining assets after paying out the withstanding debt would pass after dissolution to the hands of the city of Barcelona and the government of Catalonia. And I'm sure that the state (or the city of Barcelona) would be more than happy to become the owner of the Camp Nou stadium and that terrific land plot around they own in one of the richest areas of the city.
Would Barcelonians come up in the streets supporting their football club with their hearts, or the finances of their city with their pockets? I still have a clear answer to this question, but if the social conditions continue deteriorating in the coming months, I would possibly change my mind about this subject.
"Bread and Circus" is what the old roman emperors used to grant their people. But what comes first if you cannot afford both any more?
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