The ability of English clubs to continue attracting top players will be hit by a ruling from British regulators that caps the amount pay-TV group BSkyB can charge rivals for its sports channels, the Premier League has said.
Describing the ruling by Ofcom as 'misconceived and unjustified', the Premier League, the richest soccer league in the world, said today that the ruling would discourage rival broadcasters from bidding for sports rights.
The Premier League said the decision, which requires Sky to cut rates for its sports channels by as much as 23 percent, 'would make it harder to recruit and retain top talent' and leave less money to filter through to the clubs.
Chief executive Richard Scudamore called the ruling 'ill-judged and disproportionate'.
"Their proposed action will strip out competition for sports rights and hugely reduce the incentives of all bidders, Sky included, to invest in sports rights," Scudamore said in a statement.
"Of course we will be considering Ofcom's findings in full and do not rule out a challenge to protect the interests of fans, clubs and the wider game," he said, without the clarifying the nature of any potential challenge.
Sky have also said they will appeal the decision.
A statement from the League said: "It will be harder to recruit and retain top talent, youth development will come under pressure, investment in grounds and facilities will be deferred."
Sky have had the rights to the Premier League since the division's inception in 1992 and the millions poured into clubs from a series of coverage deals has fired the League to its pre-eminent position on the world stage.
However, even the cash-rich Premier League has started to show the strain of the stratospheric wages played to its leading players, with Portsmouth this year becoming the first club from the division to enter administration. "Ofcom has concluded that Sky has market power in the wholesale provision of premium channels," the regulator said in a statement.
"Ofcom has also concluded that Sky exploits this market power by restricting the distribution of its premium channels to rival pay-TV providers.
Other sports such as rugby and cricket, who also rely on Sky broadcast deals, will be potentially hit by the ruling and the English Rugby Football Union, which is staging the 2015 World Cup, said the decision was a 'disappointment'.
"It's unbelievable how they could take the stance that it is unfair competition as every channel had the opportunity to bid for our rights in the first place," the RFU's business operations director Paul Vaughan told Reuters.