Football chiefs reject ITV deal

TV audiences have been poor for league games

The Football League has rejected a plea from struggling ITV Digital to waive payments due for screening matches.

If this contract is not honoured our national game will be devastated

Football league spokesman

League chiefs said, after a meeting on Thursday, that agreeing to a fee reduction could lead to widespread club collapses.

"Nobody should be in any doubt that if this contract is not honoured there will be widespread bankruptcies in many local communities," a spokesman said.

"Our national game will be left devastated."

While ITV Digital had proposed a "huge" reduction and "unworkable" amendments to its three-year contract, the league was entitled to further payments of £179m, the league spokesman said.

"The board's sensible expectation is that the contract will be honoured and payments made."

ITV Digital has not commented publicly on any revised offer but is reported to have proposed paying £50m for the remaining two years of the deal - a sum that would leave the clubs facing a substantial £129m shortfall.

TV giants 'liable'

The football chiefs' response will come as a blow to ITV Digital, which is rumoured itself to be facing collapse.

While the company hoped the football contract would help revive fortunes, audiences have failed to meet expectations, leaving ITV Digital unable to win the advertising revenues it had hoped for.

Gianluca Vialli: Plea to Sky

Football League chiefs warned on Thursday that if ITV Digital failed to pay the remaining fees they would pursue ITV Digital backers Granada and Carlton for the cash.

"Carlton and Granada would be liable to fulfil the contract," the spokesman said.

Compromise

The media giants themselves are said to believe they are not liable.

ITV Digital's renegotiation plea came a month after finance experts at Deloitte & Touche were appointed to advise on ways of cutting costs at the service.

ITV Digital has so far swallowed £800m of investment, and requires a further £300m to reach breakeven point.

Some club chiefs had urged the Football League to consider a compromise deal, rather than risk forcing the end of ITV Digital and hopes of receiving any cash from the contract.

Eye to Sky

Gianluca Vialli, manager at First Division club Watford, called on digital broadcaster Sky to boost its contribution to UK soccer.

"If something happens with ITV, we hope Sky would be keen on getting the matches back on air," Mr Vialli, former coach at Chelsea, said.

A revenue squeeze would undermine the club's battle to regain Premiership status, he said.