Murdoch faces new obstacle to Sky takeover
- 11 July 2011
- From the section Business
Jeremy Hunt's reasons for asking for new advice from the media regulator, Ofcom, and from the competition watchdog, the Office of Fair Trading - in letters he plans to send them later today - are pretty embarrassing for Rupert Murdoch, chairman of News Corporation.
The culture secretary wants to know whether the disclosure that News Corp's News of the World business was out of control for many years is reason to doubt that undertakings given by News Corp to protect the independence and financial strength of Sky News are as credible and sustainable as he would like.
And Mr Hunt wants guidance on the implications for plurality or choice in the media industry of the possibility that News Corp might eventually be deemed by Ofcom as not fit and proper to own all of BSkyB.
For Mr Hunt to suggest that News Corp might not be a fit-and-proper owner of anything is a pretty big shift from the prevailing - and some would say fawning - attitudes towards Mr Murdoch we've witnessed from British governments in recent years.
Finally, Mr Hunt makes the less contentious point that the closure of the News of the World changes plurality in the media universe: that's a definitional point, in that there is, as of today, one less news voice.
However it is unclear whether the closure of the News of the World represents a reduction in News Corp's market share, and therefore an enhancement of its claim that plurality isn't damaged by its plan to own all of BSkyB - or whether the demise of the News of the World suggests that important media voices are not safe under News Corp's stewardship.
Either way, the importance of Mr Hunt's letter is in the generality: it is all a pretty clear hint that Mr Hunt might after all decide to refer the takeover to the Competition Commission for lengthy examination.
As the latest of a whole series of roadblocks recently erected in the way of that takeover -it is highly likely that BSkyB's shares will fall again this morning.