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Monday, January 11, 1999 Published at 11:35 GMT

TV football battle kicks off

Clubs like Liverpool and Arsenal could break away

One of the most crucial television football matches in the history of British sport will be played out on Tuesday in the unlikely setting of a London courtroom.

Murdoch's big match
The multi-million pound battle is between the English Premier League and the Office of Fair Trading (OFT).

The case hinges on whether the present £743m ($1.23bn) broadcasting contract between the league, BSkyB and the BBC, that expires in 2001, is in the public interest. And the two sides are likely to run up a massive legal bill of £30m to defend their corners.

'Unfair cartel'

The Office of Fair Trading claims that the league is operating as a cartel in brokering the joint TV deal with the two broadcasters on behalf of 20 clubs.

It insists that consumers are being cheated because the Premier League is artificially inflating the cost of football and restricting fans' access to watching games on television. Only 60 of the 380 Premiership games are televised live.

John Bridgeman, Director General of Fair Trading said: "Any other business acting in this way would be subject to competition law and I see no reason why the selling of sport should be treated differently."

[ image: The OFT argues that consumers are being cheated]
The OFT argues that consumers are being cheated
However, the Premier League argues that the current system is working well, earning clubs between £5m and £10m each per season.

It believes an end to the collective selling of rights would create a chasm between the top league clubs and the rest and risk destroying the structure of the competition, possibly sparking a breakaway by the elite clubs.

The Premier League also fears that victory for the OFT could mean more media companies attempt to takeover top clubs, leading to a shift of power from the league and clubs to corporate giants.

The value of soccer rights to television companies was dramatically underlined last year when BSkyB tabled a £623m bid for Manchester United, the most profitable and best supported club in the Premier League.

The bid is currently on hold pending an investigation by Britain's competition authorities.

A bid by cable TV company NTL for Newcastle United is expected if the BSkyB/Manchester United deal goes through.

'Risk of chasm'

Mike Lee, the Premier League's spokesman has warned that if the OFT wins its case, it could lead to fixture chaos and create a chasm between rich and poor clubs.

He said: "If this case is lost, you will be creating eight to 10 super-rich clubs. What you would ultimately see is power concentrated in very few hands.

"They would be the clubs in the position to do the most lucrative television deals, the clubs the companies will be chasing.

[ image: BSkyB has already bid £623m for Manchester United]
BSkyB has already bid £623m for Manchester United
"If they attracted all the money, the gap between those 10 clubs and the rest would be unbridgeable. It would undermine the competitive nature of the Premiership and might do so fatally."

The league also believes the case is backward-looking and that the market for television rights is likely to undergo enormous change by 2001.

The arrival of different forms of digital television will mean a plethora of potential broadcasters bidding for a slice of the pay-per-view footballing cake.

The case in the Restrictive Practices Court is expected to last at least four months.

However it could go to appeal and a final outcome may not be reached until next year.

Under the existing television deal, BSkyB transmits 60 live premier league matches per season while the BBC puts out a weekly highlights package in its Match of the Day programme.

The current five-year contract is worth £743m to the premier league, with BSkyB paying £670m and the BBC the balance.

Other sporting bodies such as the Rugby Football Union and the Football League will be watching the outcome of the case closely because any decision against the Premier League would set a precedent for other television sporting rights in the UK.

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