Defends Move to Exit DIRECTV Conditions

News Corp. had its say about conditions placed on its takeover of a controlling stake in DIRECTV in 2004 and efforts to eliminate the regulatory mandates tied to the transaction.

In a filing on the matter, News Corp. said that when the Federal Communications Commission placed conditions on its acquisition of a controlling stake in DIRECTV, the agency gave the media giant the right to petition for changes. Since then, News Corp. sold its interest in DIRECTV to Liberty Media, and Liberty Media divested its interest in News Corp.

Because of those moves, News Corp. pointed out that it's no longer vertically integrated with any pay-TV platform.

Conditions were placed on the News Corp./DIRECTV deal to ensure that pay-TV competitors had access to key News Corp. programming properties such as regional sports networks and broadcast stations. Entities like DISH Network and the American Cable Association have asked that the conditions remain in place to ensure access to must-have News Corp.-controlled content.

However, News Corp. said that given its divesture in DIRECTV, the balance of bargaining power has reverted to pre-transaction levels. "And any rationale for the arbitration condition that may have existed has been eliminated," the company said in its comments.

"Since an independent News Corp. has neither the incentive nor the ability to engage in the feared anticompetitive behavior that was thought to warrant the condition, the commission should eliminate it and permit News Corp. to resume bargaining for carriage of its regional sports and broadcast programming services in the competitive free market on the same footing as other independent video programmers and broadcasters," the company said in its comments.