BSkyB’s independent directors have written to Ofcom, warning the regulator that it risks generating a “perverse outcome” if Ofcom found in its investigation of a potential bid by News Corp that a deal would curtail diversity for British viewers. The directors reminded Ofcom that Sky News, the focus of some allegations of media domination in news, represents just 5 per cent of UK news viewing. A negative decision by Ofcom could threaten the position of Sky News, argue the directors.
Their submission to Ofcom states: “The availability of Sky News to audiences is the result of a strong commercial incentive, not of any obligation to provide television news [. . .]. Conversely, it has the potential to be undermined if merger control were to operate such that the operation of Sky News inappropriately or unduly restricted any merger or acquisition opportunities which may be available to Sky. Thus, a conclusion that the transaction would result in a loss in plurality could perversely increase the risk of that very situation by undermining the incentives which have resulted in the provision of Sky News to date.”
“This would be a wholly unwelcome outcome, contrary to the public interest, and not one that that the independent committee (of directors) wishes to see.”