UK Regulator to Probe Murdoch Company's Threat to News Diversity

11 July 2007

LONDON: Last November's snatch by Clan Murdoch's satellite TV monopoly BSkyB of a spoiling 17.9% stake in Britain's largest commercial broadcaster, ITV, could threaten the nation's diversity of news outlets, opines the UK Competition Commission.

The share grab, which most observers believe was a spoiling tactic designed to torpedo ITV's possible merger with US cable company Virgin Media, not only blew the mooted marriage out of the water - it also triggered a chain reaction at political and regulatory level.

The issue was initially mulled by the Office of Fair Trading, which then ruled that it be referred to its senior body, the Competition Commission.

The latter revealed Monday that its investigation will not be restricted to News Corporation's TV interests - but will also take account of its dominance in print news media.

The media mammoth's four national and weekend newspapers between them account for around 37.5% of all UK newspaper readership.

Of particular concern to the regulator is ITV's 40% stake in ITN (Independent Television News), which supplies news to ITV and Channel 4. The inquiry will determine whether BSkyB's holding could influence ITN's editorial approach, strategy or funding.

Should the regulator rule that BSkyB's holding in ITV is against the public interest, it could recommend the government to force Sky to sell the stake.

Which will be a sizzling political potato for new prime minister Gordon Brown and his New Labour administration.

Both have one eye firmly fixed on the next general election (likely to be called in 2009); the other on their need for support from the Murdoch media pack.

The investigation is expected to take at least six months.

Meantime, BSkyB piously denies its ITV stake was a wrecking tactic, insisting it invested in an under-valued company with significant growth potential.

Data sourced from BBC Online (UK); additional content by WARC staff