The owners of cash-strapped British pay-TV firm ITV Digital plan to pull the plug on the venture in "a matter of weeks" if its administrators fail to renegotiate a contract with a major creditor, sources said yesterday.
"No length of time has been set. But it's more likely to be weeks than months," a source close to owners Granada and Carlton Communications told Reuters when asked how long they would continue underwriting the venture.
ITV Digital called in administrators Deloitte & Touche to run the firm on Wednesday after failing to cut the price of its multimillion pound contract with the English Football League.
Deloitte is to report to the High Court on progress on April 15th.
"If the Football League deal were to happen, it would have to happen in two weeks," the source added.
If the crisis is not resolved by then, the business could be liquidated or sold, spelling the end of Britain's second-biggest pay-TV business, stopping the drain on cash for its owners and leaving its 1.26 million customers up for grabs.
The country's dominant pay- TV operation, Mr Rupert Murdoch's satellite service BSkyB, is likely to benefit but it throws into doubt the future of some of the league's smaller teams.
It could also upset Britain's plan to be the world's first fully digital TV nation. But ITV Digital is not the only European broadcaster to suffer in the pay-TV arena. Germany's debt-laden Kirch Group is bleeding cash at the rate of €2 million per day from its Premiere pay-TV operation.
Sources said the administrators had "lines open" with the league and would have an update very early next week. They said the football clubs might be more willing to talk under government pressure to reach a compromise deal. Ms Tessa Jowell, British Minister for Culture, rejected a call for the government to bail out football clubs facing collapse, saying troubled clubs themselves were largely to blame for their plight.
"No, we're not going to help them out," Ms Jowell told BBC radio, adding that some clubs were already in trouble before ITV Digital said it couldn't pay the league £178.5 million sterling (€291 million) remaining from an original three-year £315 million sterling deal.
