The satellite broadcasters are reportedly attempting to negotiate reductions on the length and cost of the four-year, £125million agreement they reached with the SPL last summer, which is due to commence in 2010.

Setanta lost one of their two packages to show live Barclays Premier League matches between 2010 and 2013 in the most recent bidding war with Sky.

McGhee, whose club rely on TV revenue for almost a third of their income, was at Millwall in 2002 when the ITV Digital deal collapsed.

He said: "We don't know the figures yet on the Setanta deal.

"It depends what the reduction ends up being. If it's a third of the money then that could end up being a third of our turnover.

"That would be catastrophic for our club and we'll end up playing the youth team next year.

"I was at Millwall and the collapse of the ITV Digital deal did have a huge impact on the club."

SPL clubs are set to meet at Hampden on Thursday to debate Setanta's proposals and McGhee fears the outcome could scupper his attempts to hold on to out-of-contract players such as Stephen Hughes, Graeme Smith, Brian McLean and Bob Malcolm.

"There's a chance Stephen will stay but it probably won't be down to us," he said.

"It's more to do with what other clubs come in and offer him.

"Our door will never be closed and if Stephen came back to us late on and says he wants to stay then great. But there are economic factors at play.

"We have to save money and the Setanta deal could cause further problems. Stephen could turn round and say he wants to stay and then we don't have the money to keep him.

"For all our sakes, we need to know where we stand."