Last summer we interviewed a confident David Burns, the Football League's chief executive. Since then his member clubs suffered the collapse of ITV Digital, while rumours persist that Celtic and Rangers will be asked to move south. So we went back to find out how he viewed the situation after a turbulent season
The Football League has called on the government to intervene in the ITV Digital dispute. What exactly do you believe they should do?
I think that the government can and should do more. I have made it clear to Tessa Jowell, the secretary of state for Culture, Media and Sport, that the government should condemn the action of Carlton and Granada, yet they refuse to do so. They could have a full enquiry conducted by the regulator – the Independent Television Commission – and they could stop giving cash to Carlton and Granada by way of what’s called the digital dividend. These broadcasters, for every viewer they get transferred over on to a digital platform, whether it’s satellite or cable, get a tax-free sum, a rebate against what it costs to be a public service broadcaster, which for the ITV network is £400 million a year. Over the next ten years they can earn up to £320 million of that back through rebates. On Carlton and Granada’s own figures, between 2001 and 2010, which is the period the government set for the switch over from analogue, it’s worth £2 billion to them. Carlton and Granada pulling out of the League deal is nothing to do with the product itself or with them having overpaid for what they got. Because they paid the going rate at the time – in the same way that Sky did. They just decided they couldn’t run a paying channel against Sky. The reasons why were poor technology, poor customer service and poor marketing. And yet they suddenly saw that they could make more money out of the digital dividend then they could through subscribers. The government could simply call the ITV companies and say: “You can forget all about the digital dividend until you pay your debt to football.” And that would also serve as a warning to other companies generally, because what we’ve got here are two major FTSE 100 companies who have just walked away from their liabilities – which is almost unprecedented.
How will this dispute affect future relations between ITV and football?
When it comes to the ITV network, they’re in this as well – there are five shareholders in there, including Carlton and Granada, and they are going to find it hard to do business not just with football and other sports rights holders but with rights holders in general. They would say to them, you are the people who signed a contract, agreed to pay money, then decided you didn’t like it and ran away. So we have to pursue legal remedies. Carlton and Granada have refused to meet with us. There are a lot of myths out there that we have been offered money and turned it down, but we’ve never been offered anything. I think they have misunderstood the power of football and its fanbase and just assumed it will go away.
Do you expect to have a new TV deal in place by the start of the season?
Three things we need – income, distribution and security of contract. We know there is interest in taking Football League product and the Worthington Cup, but we also know that the money that was there at the height of the market in 2000 is not going to be there today. I would also add that we have excellent relationships with all the various broadcasters and commercial partners within football generally. We have invited to the play-offs all the people who work in senior positions at ITV Digital, who are as much victims of what Carlton and Granada have done as anyone else.
What is the truth of the claim that the League failed to obtain sufficient guarantees from ITV Digital’s parent companies when they agreed the contract?
It’s not true. The League has guarantees. Carlton and Granada stated that ONDigital [as ITV Digital was previously known] and its shareholders will guarantee all funding for the Football League. At the time what didn’t happen was the formalisation of their words into a two-page written guarantee. When I specifically requested these from ITV they said: “Oh, Carlton and Granada don’t give them.” Our claim against them was filed in May. We have applied to fast-track the case and hope to have it heard by August. Whichever side loses will go to the Court of Appeal. There are a number of technical legal points, many of which have had to have the dust blown off them as they’re from centuries ago, but our legal counsel has indicated we have a good case and has said that on the merits of the case, we will win.
The latest round of stories linking Celtic and Rangers with the Nationwide League coincided with the news that a group of First Division clubs had invited tenders from marketing agencies about how to market themselves collectively. Do you see this as a sign of the Phoenix League idea stirring again?
What it is is an agitation for more money. And we are in a big financial crisis by virtue of the actions of Carlton and Granada, no question about that. The Phoenix League that was originally advanced envisaged Celtic and Rangers joining. But the Premier League don’t want a Premier League II, it’s a contradiction in terms. What we need to work towards is a realignment of the two leagues. I would argue that most supporters don’t see the neccessity of having two professional leagues and the FA, nor do they understand how they interact.
David Dein has suggested that the Premier League and the Football League might eventually form their own channel, with the SPL too. Have you talked about that?
I think he’s right. There have been discussions around this generally. TV broadcasting is about content, and we’ve got the best sport content there is in football. As far as the big clubs are concerned, as long as you can maintain their brand position, the distribution of income in their favour and the voting structure, the back office doesn’t really matter. My view is that we should align the two leagues back together and get the money sorted out. I do envisage that there is the potential for a British Cup. When we talked about it with the Premier League, they said they would agree with the Worthington Cup providing a European place for at least the next two years and we will then sit and discuss the make-up of the competition. The result of that was the idea for the British Cup. I think cup competions generally lend themselves to being cross-border. I don’t see that the leagues do, other than a general European one.
So why do we keep hearing about Celtic and Rangers joining the Football League?
That was the story on BBC News on May 11. It wasn’t on the agenda for the League board’s regular meeting on the following Thursday and the meeting for clubs that was called for the day after was an update on the ITV Digital situation. I talked to a Radio Scotland reporter who told me an application to invite Rangers and Celtic was to be placed before the club chairmen by the representative of a League club. So I said to him “OK, which club is it, then?” He said “Bradford City”. I managed not to laugh. No formal vote was taken.
It doesn’t seem to make sense from the First Division clubs’ point of view, as they might be sacrificing two promotion places for the sake of one season’s gate receipts from Rangers and Celtic.
My view simply is that this is not going to happen. People say the Football League TV rights would be worth so much if Celtic and Rangers are sold along with the First Division. I agree, they would. However, how is it going to enhance our competition? Keith Harris, the League chairman, and myself have had a number of discussions over the past 18 months with a number of people, not just in Scotland, looking at how the football business might grow. But it must operate with a structure which is pyramidical. That’s not to say that one day you couldn’t conceive of a British league, but I don’t think we can seriously consider a case of two teams being parachuted in with no real entry qualifications. Then Aberdeen, Hearts and the other teams in Scotland might also say: “If it’s OK for Rangers and Celtic to join, why can’t we too?” I just think that, conceptually, the idea is wrong. Start chopping that pyramidical structure around and we might as well say: “Well, Rangers and Celtic don’t need to join as themselves, they can just go and buy Carlisle.” The First Division with 24 clubs is big enough already in view of all the other matches in the calendar. You add Celtic and Rangers, that’s 26. But let’s say that we still haven’t got enough money – and bear in mind that most of the money goes to the players anyway. Who else do we want? Halmstad? Ajax and Feyenoord?
Rangers and Celtic surely don’t want to risk being in the First Division for more than one season either.
What do Celtic and Rangers want? They want to play Man Utd, Liverpool, Arsenal. But do most of the Premiership clubs want them? The indications are no, because some clubs fear it might make it harder for them to stay up. People laugh in England that the Scottish title is won only by either Celtic or Rangers. But down here we’ve had ten years of the Premiership and it’s been won by either Man Utd or Arsenal, apart from Blackburn having that one year. If those teams want to take themselves into a different area, it’s European, because that’s the direction the businesses have grown in. But I think it would be a very brave English club who would abandon its domestic market completely. The only way you might be able to sustain interest would be if you made football a 12-month-a-year business.
But how could they mix domestic and European football any more effectively than they do now?
I could envisage a situation in which a European League is created, along with a reversion to a European Cup as a knockout – as that’s what the fans would like. For income purposes you need a European league and you slot that in to a point in the calendar when the teams aren’t playing domestic matches. The TV audience for that would be huge, worldwide in fact. Now, the downside is that it would become self perpetuating, because the more money they get, the wider the gap becomes between themselves and the rest. But there would still have to be an element of relegation. Promotion might be limited by certain heavy criteria, say a stadium of 40,000 people, so the competing clubs would be bringing in sufficient numbers of people. Any such European league would be the pinnacle. But underneath there would always need to be strong domestic set-ups in every country too.
From WSC 185 July 2002. What was happening this month