Watchdog concern over bid

Sky deal would give Murdoch family ‘too much control’

James Murdoch vid

James Murdoch: the family trust would have too much control says watchdog

Competition authorities say 21st Century Fox’s proposed takeover of Sky is not in the public interest due to media plurality concerns.

The Competition and Markets Authority said: “The media plurality concerns identified mean that, overall, the CMA provisionally concludes that the proposed transaction is not in the public interest.”

In its 21st Century Fox’s £11.7bn offer to buy the rest of Sky – it already owns 39% – the CMA said it has found that if the deal went ahead, as proposed, it would lead to the Murdoch Family Trust, which controls Fox and News Corporation, increasing its control over Sky, so that it would have “too much control over news providers in the UK across all media platforms (TV, Radio, Online and Newspapers), and therefore too much influence over public opinion and the political agenda.”

The CMA said the transaction is not likely to operate against the public interest on broadcasting standards grounds.

Elaborating on its reasons for finding that the deal is not in the public interest in terms of media plurality, it said that the Murdoch Family Trust (MFT) news outlets “are watched, read or heard by nearly a third of the UK’s population, and have a combined share of the public’s news consumption that is significantly greater than all other news providers, except the BBC and ITN”.

It added: “Due to its control of News Corp, the Murdoch family already has significant influence over public opinion and full ownership of Sky by Fox would strengthen this even further.

“While there are a range of other news outlets serving UK audiences, the CMA has provisionally found that they would not be sufficient to moderate or mitigate the increased influence of the MFT if the deal went ahead.”

The CMA said when considering 21st Century Fox’s offer to take control of Sky on broadcasting standards grounds: “The investigation also considered the recent allegations of sexual harassment against Fox News employees in the United States.

“While these are serious,the CMA has provisionally found that these are not directly related to the attainment of broadcasting standards and do not call into question Fox’s or the Murdoch Family Trust’s commitment to broadcasting standards in the UK.”

21st Century Fox said: “We welcome the CMA’s provisional finding that the company has a genuine commitment to broadcasting standards and the transaction would not be against the public interest in this respect.

“Regarding plurality, we are disappointed by the CMA’s provisional findings.”

It said: “We will continue to engage with the CMA ahead of the publication of the final report in May.”

Sky said it noted the provisional view of the CMA, that the transaction is not likely to operate against the public interest on broadcasting standards grounds.

Sky also noted the CMA’s provisional view that the transaction may be expected to operate against the public interest on media plurality grounds, but, at the same time, that the CMA has set out possible remedies relating to these concerns, and is seeking submissions on these.  

According to the updated administrative timetable published by the CMA, the deadline for its final report to the Secretary of State is now 1 May.

The CMA states that it has extended the timetable due to the “exceptional volume of substantive submissions, the need to hold a large number of hearings and the novelty and complexity of the investigation”.  


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