British broadcasting giants Carlton Communications and Granada Media have agreed to pay about £20 million ($28.8m; €32.7m) owed to Britain’s elite soccer division the Premier League by their jointly owned digital platform ITV Digital, placed into administration last week [WAMN: 28-Mar-02].
The news is significant because ITV Digital’s collapse was triggered by the £178.5m it owed to the Football League (the three divisions below the Premier League) for broadcast rights over the next two years – a payment the two media giants have repeatedly refused to honour.
The £180m, three-year pay-per-view rights deal with the Premier League – forged alongside rival dTV operators BSkyB and NTL – is believed to include guarantees from ITVd’s parent companies that the money be paid.
However, Granada and Carlton insist they cannot be made to pay the platform’s debt to the Football League because a contract detailing their duties as ITVd’s parents was never signed.
The revelation that the broadcast duo will pay the high-profile Premier League but not its less lucrative sibling will likely sour relations with the Football League further.
ITVd tried to reduce its outstanding payment to the FL to just £50m – an offer rejected by League bosses, who claimed that such a massive reduction in TV cash would spell doom for numerous clubs. The League insists Carlton and Granada should honour the debt.
However, there may be room for compromise – Bradford City chairman Geoffrey Richmond revealed that a reduced offer of £120m “would be acceptable to the vast majority of Football League clubs.”
Data sourced from: Financial Times; MediaGuardian.co.uk; additional content by WARC staff