Culture Secretary urged to refer News Corp bid
by Colin Mann

A group comprising members of the House of Lords, academics, campaigners and trade unionists has written an open letter to the Financial Times urging Jeremy Hunt, the Culture Secretary, to refer News Corp’s bid to acquire the 61 per cent of BSkyB that it does not already own to the Competition Commission.

The letter’s signatories were led by Lord Fowler, a Conservative peer and former Cabinet Minister, and until this year, the chairman of the House of Lords communications committee.

The letter says that the proposed takeover “raises deep public interest issues. News Corp already controls 37 per cent of newspaper circulation. BSkyB, one of only two commercial TV news companies in the UK, supplies Sky News, Channel 5 news and virtually all commercial radio news.” It points out that the merged company would have a reach of 52 per cent of the adult population, which it suggests would have “profound consequences not just for media plurality but for our democracy.”

“The UK needs a range of news providers offering a mix of viewpoints,” it continues. “At the moment, Sky News, which has a central role in shaping the national news agenda, has an independent voice because it has independent directors and a majority of independent shareholders. Mr Murdoch himself has said that the reason Sky News is not yet more like Fox News is because ‘nobody at Sky listens to me’.

“We believe that this independence would be fatally undermined by a News Corp takeover,” say the signatories.” Of the 175 News Corp newspapers worldwide, every one supported the Iraq war because of the strong editorial control exercised over them. Sky News risks going the same way, with profoundly distorting consequences for the UK’s news agenda,” it warns.

According to Fowler, the new merged company would also be able to ‘bundle’ together television and newspaper services via BSkyB’s “huge subscription base in a way that would place severe financial pressures on the rest of the media market. Some newspapers might close, reducing plurality – already in short supply – even further,” it observes.

“All these issues should be of real concern to those interested in the future of UK media and the quality of our democracy. Their potential long-term impact is huge, and they need to be carefully scrutinised by the appropriate authorities. We urge the UK secretary of state for culture, media and sport to refer this bid to the Competition Commission for proper examination,” the letter concludes.

The UK government asked comms regulator Ofcom to examine the deal and to make a recommendation as to whether it should be referred for further inspection by Britain’s Competition Commission. and submitted its report to Hunt on December 31, without its contents being made public.
The report will remain confidential until it is published by the Department for Culture, Media and Sport (DCMS), which took over responsibility for the proposed deal after Business Secretary Vince Cable was recorded making suggestions that he was waging war against Rupert Murdoch’s News Corp.

Ofcom is expected to request a further investigation, with the decision on how to proceed then falling to the Culture Secretary. Hunt will aim to make his decision by the end of January, according to DCMS officials.

Ofcom’s role has been to examine the case on media plurality grounds. The deal has already been given unconditional approval from the European Commission, which addressed competition issues