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Reaction to Sky News spin-off deal

March 3, 2011

Jeremy Hunt, Culture Secretary, who approved the deal says: 

“Informed by advice from the regulators, I believe that these will address concerns about media plurality should the proposed News Corporation/BSkyB merger go ahead. The undertakings offered would ensure that shareholdings in Sky News would remain unchanged, and indeed offer it more independence from News Corporation than it currently has.

Throughout this process I have been very aware of the potential controversy surrounding this merger. Nothing is more precious to me than the free and independent press for which this country is famous the world over.  In order to reassure the public about the way this decision has been taken I have sought and published independent advice at every step of the way, even when not required to do so by law. And I have followed that independent advice.”

The rival newspaper groups trying to thwart the deal said: “If the purported remedy leaves Sky News dependent on News Corporation for its money that will not be true independence. A lot hangs on the fine print of the offer from News Corporation. We will oppose any unsatisfactory arrangement, and consider all legal avenues available to us.”

Professor Steven Barnett, Professor of Communications at the University of Westminster, said: 

“News Corporation’s takeover …..yet again raises disturbing questions about cosy deals between government and Rupert Murdoch without proper regulatory scrutiny.

“Ofcom has raised important questions about the threat to news plurality in the UK from a single media corporation owning 37% of the national press as well as controlling one of only two commercial television news stations. It is imperative that the details of any “compromise” involving independent editorial control or the partial sale of Sky News are subjected to proper investigation by the appropriate regulators to ensure that news plurality is genuinely protected and sustained over the long term.

“Previous deals involving “independent” boards for Murdoch’s takeover of the Times newspapers and the Wall Street Journal have proved virtually worthless in protecting editorial independence. This deal raises profound questions over what will happen to the ownership of Sky News in the longer term, who will make senior editorial appointments, and for how long a “separation” of one channel from a corporate parent can be sustained.

“This deal will create a hugely powerful newspaper, TV, online and ISP media conglomerate which will dwarf every other media organisation in the UK, and would not be permissible in most other democracies. It is unacceptable that such unaccountable power in the hands of one corporation – and ultimately one man – should be waved through by a government minister without thorough and independent scrutiny by an independent body. Once again, it appears that our politicians have proved themselves incapable of standing up to the demands of a powerful media baron.”

Categories: Articles, Broadcast, M&A, Regulation