Twenty three Football League clubs could go out of business following the latest TV rights deal which has seen income cut by more than a quarter on the previous contract. That’s the view of Football Trade Directory’s commercial director, John Booth.
The Football League have negotiated a new three-year package with Sky TV which comes into force from the 2012/13 campaign, a deal which sees a shortfall of £23m a season less then the previous contract. With clubs across the football pyramid already struggling in the harsh financial climate clubs are going to find balancing the books increasingly difficult.
Speaking at a recent parliamentary committee, Football League chairman Greg Clarke admitted that the game was ‘heading for the precipice and we will get there quicker than people think’ - a view echoed by Booth.
FTD’s commercial director, John Booth has more than a decade’s experience working on commercial deals for Preston North End and Stoke City and he believes that the latest deal could be the death knell for many Football League clubs.
"Without naming names I know of at least ten Football League clubs who are very close to going to the wall," Booth said.
"Whilst it’s not as devastating as the ITV Digital debacle, a loss of £23m a year is still a massive blow to Football League clubs.
"This shortfall won’t only affect the smaller clubs in the Football League, Championship clubs will be down £750,000 a season and that will have a significant impact.
"Almost every Football League club depends heavily on their TV income and this reduction in revenue could be the final nail in the coffin for many clubs. If there are ten clubs close to going out of business now, you can guarantee that there will be more. It’s not unfeasible to think that there could be a club go bust for each £1m the deal is short, that’s 23 clubs, almost an entire division!"
Football Trade Directory is already working closely with clubs up and down the football pyramid, using their extensive network of key business contacts in the game to help clubs cut commercial deals.