Real Madrid's 5-1 aggregate defeat to the Gunners has left the club in a state of shock. Balague, who penned Lionel Messi's biography, believes Ancelotti's time is up.
"Real Madrid stands at a crossroads," Balague told us. "Their squad is in desperate need of a refresh. The Arsenal defeat hasn't caused a reset, it's simply confirmed the need for it."
"For Ancelotti, the message is clear - it's time to move on," he added. "This squad needs new energy. Toni Kroos has never been truly replaced, the midfield lacks control. While Luka Modric remains a legend, the need for someone who can control the tempo without being 39 is obvious."
"The club has to make some tough decisions this summer," Balague concluded.