"It has become too expensive and is not commercially viable", said Ian Walker, skipper of GBR Challenge in Auckland. "It's worrying for the future certainly".

British sailors may have dominated on the water at recent Olympics but many will miss out on the chance to compete for one of the sport's ultimate prizes because of the Cup's spiralling costs.

"The funds required are way beyond what companies are prepared to pay, in terms of the returns they feel they can get from the event, so you're reliant on very wealthy private individuals".

"The America's Cup will always be relevant because of the history but you need to have sufficient teams to make it a competitive regatta, and getting that number of teams will be a problem while the budget is so high."

Walker is concerned that the absence of a British-based entry will squander the gains made by Harrison's team.

"It took so much effort and money to get back into the Cup and to see it fall over is desperately sad," said Walker, "We gained a huge amount of knowledge in New Zealand, some of which has already trickled down into Olympic teams and other areas of the sport and marine industry".

GBR Challenge have until April 2005 to find a backer.