NewsCorp Offers DirecTV Concessions to US Regulators

02 May 2003

So keen is Rupert Murdoch to gain control of US satellite platform DirecTV that he is making concessions to regulators before they have even examined the deal.

News Corporation last month agreed the $6.6 billion (€5.9bn; £4.1bn) purchase of a controlling stake in DirecTV’s parent, General Motors unit Hughes Electronics, fulfilling a longstanding ambition of the media mogul [WAMN: 10-Apr-03].

The Federal Communications Commission will now review whether the takeover of DirecTV – America’s number one satellite-TV broadcaster – is in the public interest, while the Department of Justice will investigate whether there are antitrust issues. But to make sure the deal goes through, NewsCorp is already offering guarantees on the carriage of other broadcasters’ content and the price of its own.

According to one insider, the media giant “is offering an unusual commitment … that would ensure legally binding access to DirecTV for other broadcasters and programme-makers.”

It is also reportedly vowing not to use its control of DirecTV to extract better deals from cable operators for their carriage of the Murdoch-owned Fox network. Continued the mole: “It will not discriminate in price and conditions in offering Fox to any other distributor.”

This promise is also thought to cover other programming from NewsCorp and its affiliates, such as that produced by Murdoch’s British satellite operator BSkyB or the Discovery group of channels (49%-owned by Liberty Media, a leading NewsCorp shareholder).

Regulators have 180 days to review the deal, but NewsCorp is hoping for swifter approval.

Data sourced from: Financial Times; additional content by WARC staff