ITV Digital and football minnows wrestle for lifeline

ITV Digital has warned that unless clubs from the English Football League this weekend accept a revised offer for the rights to their games it may have to close down.

The Football League has hit back, insisting that if the broadcaster reneges on its current contract - meaning it would pay £50m over the next two years instead of the agreed £180m - 30 to 50 clubs will go bust.

ITV Digital is the broadcaster of digital television channels via existing terrestrial infrastructure. It has had a troubled existence, losing money as it battles cable operators and especially BSkyB, the digital satellite TV company backed by Rupert Murdoch and others.

ITV Digital owners Carlton Communications and Granada are now thought to be close to pulling the plug in their joint venture, which needs at least another £300m investment to see it through to profitability.

This morning's FT quotes unnamed sources from ITV Digital's backers as saying they are "emotionally prepared" to close the business down. Such a move would not only hurt Carlton and Granada but government plans to get most of the UK population online, with digital TV being seen as a ubiquitous and simple platform.

One of the suggested white knights for ITV Digital could be BSkyB, though there has been no confirmation of any negotiations.

Most clubs in the Football League are already in the red and distributed broadcast rights money - while not in the same league as sums paid to Premiership teams - is an essential part of their income.