Field of nightmares

The English football season has been produced plenty of entertainment on the field this season. Fans with an interest in business have been twice blessed, because the excesses of the past couple of decades suddenly seem set to produce a big implosion. Yes, I know that's been said every year since the turn of the century, but consider the evidence:

* Portsmouth FC are poised to become the first top-flight club to go into administration. A rapid succession of owners of uncertain means (and even identity) has left the club unable to pay its players on time three times so far this season, in debt to half a dozen other clubs and with huge unpaid liabilities to the taxman.

* At the same end of the league, West Ham have just been taken over by new owners who have immediately revealed the shocking state of the club's finances. Apparently debts total £100 million, which makes you wonder what the former owner, the now-bankrupt Icelandic biscuit king Diggestyfe Hobnobbesson, can possibly have done with the money. An early priority for the new owners, who were both keen to stress their barrow boy credentials, is to secure a deal to move the club into the Olympic Stadium once the 2012 games are over. This rather suggests they have their eye on real estate profits from selling the Boleyn ground. How long will they keep putting money into West Ham if those plans are thwarted?

* Switching to the "big four", Manchester United are about to get loaded up with even more debt as the US owners, the Glazers, try to pay down some of the expensive PIK (payment in kind) debt they took on to buy the club. The prospectus for the new bond deal produced a shock horror reaction from the sporting press as it revealed how much the club depends on continuous on-field success to service its debt burden.

* Just down the East Lancs Road, dysfunctional ownership (again from the US) has driven Liverpool FC to the brink of mediocrity, with no money to spend on reinforcements and plans for a new stadium going nowhere.

As I noted at the outset, there have been similar stories just about every year since the Premier League began, and so far disaster has been avoided. This time, though, it really may be different. Sky News is being told by the regulator Ofcom that it must stop overcharging other distributors for carrying the games it broadcasts. It's a measure of how much Sky is raking in that BT has said it will cut its price for Sky Sports channels to £15 from the current £25 per month if Ofcom wins the case. Revenues from Sky, rather than money taken at the turnstiles or through the sales of garish polyester replica kits, have been the key to the Premier League money machine. If Sky pays less for football broadcast rights in future, it won't just be Portsmouth that has trouble paying the on-field "talent".