English clubs are facing up to their worst season in the Champions League since 1996.
Not since that year, when Blackburn was the Premier League's sole representative in Europe's top club competition, has an English club failed to make the quarter-finals.
The disastrous first legs suffered by Arsenal and Chelsea in Italy, combined with the Manchester clubs' failure to make the knock-out stages, means that there is now every likelihood of a last-eight made up purely of continental sides.
It is in stark contrast to the years from 2007 to 2009, when in each of the three seasons, three of the four semi-finalists were English: either Manchester United, Chelsea, Arsenal and Liverpool.
For O'Leary, who managed Leeds United to the Champions League semi-final in 2001, the change is down to a simple reason: the quality of the top Premier League sides has slumped.
United boss Sir Alex Ferguson disagrees, insisting the English clubs will be dominant again, but O'Leary is concerned that the need to keep the Premier League established as the most exciting brand of football in the world has made the values of simple defending expendable.
O'Leary told Press Association Sport: "The quality of the Premier League has not improved - if anything, it has gone backwards.
"Chelsea have gone backwards, Arsenal have gone backwards, Liverpool are not a challenge any more.
"I think even Sir Alex would not view his current United side as his best crop so it was a fantastic achievement to get to the Champions League final and win the league last year.
"Manchester City have had an unbelievable amount of money to spend but they are still emerging.
"We have got carried away with it - I've just come back from Dubai and the only football they really get excited about is the Premier League. Defending-wise the top teams are conceding too many goals and that really hurts them in Europe.
"Think of the Chelsea side under Jose Mourinho with a young John Terry and Frank Lampard - a really strong team; think of the Arsenal side of a few years ago or Manchester United when Cristiano Ronaldo was there. Are they as good [now]? No way."
Raymond Verheijen, the experienced Dutch coach who worked under Guus Hiddink for many years before becoming assistant to the late Wales manager Gary Speed, was blunt in his assessment after Arsenal's 4-0 humbling by AC Milan last week, saying: "Milan just needed 45 minutes to once again prove the point that the quality of football in the Premier League is getting lower and lower."
Ferguson, however, disagrees and believes that English sides are merely at the bottom of a cycle that sees particular countries dominate in Europe at different times and that the Premier League clubs are not "on the slide".
The United manager said: "First of all, success in Europe can sometimes go in cycles. Spain had a great cycle about 10 years ago when Valencia, Deportivo, Villarreal, Real Madrid and Barcelona were all dominant. There were three of them in the semi-final one year.
"We have had a great cycle in the Premier League for the last eight years with teams getting to the semi-finals and finals. I don't see that subsiding. I think the English teams will still be dominant.
"We have had a bad year this year. We have in particular - I can only judge myself. We are disappointed with how we have done. Arsenal and Chelsea have had disappointing results but both clubs have had injury problems and you can't expect them to get the best results without their best teams.
"It is maybe a little bit disappointing season but to my mind, it is not definite that we are on the slide."
The longer-term issue for English clubs is the UEFA co-efficient which governs the number of clubs they have in the Champions League group stage.
If Premier League clubs repeat the failure next year and Italian Serie A sides continue to improve then England could face a real threat of their allocation being cut from four places to three.
One off-season is manageable, but the warning signs are there.
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