"Chelsea have a history of frustration", Inter Milan coach Jose Mourinho said after defeating his former club in the Champions League.

He was right, of course. Seven years since the takeover by Russian billionaire Roman Abramovich, the Blues still can't win the Champions League. Their potential remains unfulfilled, perhaps forever: Didier Drogba (32), Frank Lampard (31),  Nicolas Anelka (31), Ricardo Carvalho (31) and John Terry (29) are not getting any younger.

What next for Chelsea?

On Tuesday night, there was a definite sense that a major infusion of new blood was necessary to freshen things up, not just one or two new signings. Carlo Ancelotti, we were told, has been given funds to make drastic changes.

All of this doesn't bode too well for Michael Ballack. The German captain will be 34 in September. Like his club, he's once again missed out in Europe. Like his club, he's at the crossroads. His contract ends this May. Chelsea have offered a one-year-extension, Ballack wants two seasons.

Money is not really the issue here - the ex-Bayern player simply demands a deal that takes him through to the Euros in 2012, his last tournament before retirement. A couple of weeks ago it looked as if a compromise could be found quite easily but that's no longer a given. Ballack was substituted after 62 minutes against the Italians. He didn't have a good game, along with most of his team-mates. Abramowich, an aide told journalists, was vivid. All bets are off, for now.

Joe Cole looks set to be the first casualty. The England midfielder is unlikely to be offered a new deal. Anelka, who's also been offered a one-year-extension, has been stalling but might find the offer withdrawn if and when Chelsea make a move for one of their long-standing targets Fernando Torres (Liverpool), Sergio Aguero (Atletico) or David Villa (Valencia).

Ballack loves London and his family are settled in the British capital. He doesn't want to move. There has been some tentative interest from Manchester City - their manager Roberto Mancini is good friend of the German - but Chelsea is still his only realistic option in the Premier League.

A return to the Bundesliga would be a theoretical alternative but undesirable for reasons of status: he wants to finish his career at the very top, not one level below.

His talents on the decline

There are some indications that Chelsea and Ballack might still agree on a one-year-deal with a view to talk again in January. The midfielder no longer poses quite the attacking threat from two or three years ago but he has won the confidence of successive coaches in a more defensive role that requires plenty of experience, less running. Ancelotti will also have noted that a bad team performance against Inter only turned into a disastrous one in the last 30 minutes, when Chelsea were overrun, with Ballack sitting outside, shaking his head.

His perhaps biggest problem is the lack of a clear organisational hierarchy at the club. Since former CEO Peter Kenyon has left, various people have been conducting negotiations on behalf of Abramovich, whose views remain enigmatic and subject to sudden changes.

This uncertainty comes at the worst possible time for Ballack. And for Germany.

There are only a couple of months before the World Cup, the player's big and probably best chance to finally win the international title he has been craving for so long. He, too, has a history of frustration. Jogi Low must hope that a decision is made one way or the other very soon on his captain's future.

The national manager has enough players who are unsettled or out of form at the moment  - Rene Adler, Miroslav Klose and Lukas Podolski come to mind  - to afford worrying about his most important asset as well.