Sky may axe FA Cup

The FA Cup was dealt a potentially major blow today after Sky said it was considering dumping its joint rights to screen the competition when its contract runs out in two years time.

Sky and the BBC paid £400 million for the joint rights to screen England and FA Cup matches during the peak of the football boom in 2000.

The deal was part of a major effort by the FA to relaunch the world's oldest cup competition after it was criticised for losing its appeal.

But since then the market has dropped alarmingly and the recent collapse of ITV Digital has sent shock waves through football.

The Football League is threatening a £500m lawsuit unless ailing broadcaster ITV Digital pays its 72 clubs the £178.5m it owes them.

Sky says its viewing figures for the FA Cup are down compared to last year when it had a joint deal with ITV. Now the FA Cup looks set to suffer as Sky refocuses its business strategy.

Chief executive Tony Ball has told City analysts he is prepared to drop what he terms "lesser" competitions when the rights come up for renegotiation next summer.

He has made it clear to the City that major sports rights like the Premier League, which in 2000 Sky paid £1.1billion for, remain central to Sky's future.

A Sky spokesman said today: "We are going to be careful with the rights we choose and careful about what we pay."

The first sign of Sky's new approach came last week when it dropped its Six Nations rugby deal to concentrate on England's autumn internationals against South Africa, New Zealand and Australia.

There's no suggestion Sky will try to break its FA contract, but Ball has made it clear he is no longer prepared to pay millions for rights which are not bringing in mass audiences.