People/Biz

Fox-Sky merger stalled amid media plurality concerns

Rupert Murdoch-owned 21st Century Fox has been stymied in its efforts to take full ownership of European media co Sky amid ongoing concerns over media concentration. The delay in the transaction was triggered in ...
June 29, 2017

Rupert Murdoch-owned 21st Century Fox has been stymied in its efforts to take full ownership of European media co Sky amid ongoing concerns over media concentration.

The delay in the transaction was triggered in March when the UK’s Secretary of State for Culture, Media and Sport issued an European intervention notice, which asked the UK media regulator Ofcom to report on two public interest considerations around plans by 21st Century Fox to acquire the final 61% of shares in Sky it does not already own.

Specifically, Ofcom was asked to consider whether there would be sufficient plurality of people with control of the media enterprises, and whether the media cos would maintain a genuine commitment to broadcasting standards.

Ofcom was given until June 20 to submit its report. It was made public today (June 29).

There is good news for the Murdoch Family Trust, which has been shaken by allegations of sexual and racial harassment at one of its key U.S. media properties, Fox News. Ofcom looked at whether those allegations might impact Sky should the acquisition go ahead, but, ultimately, determined that would not the case.

“Our assessment finds that Sky would remain a fit and proper licence holder in the event of the merger. As fitness and properness is an ongoing duty, we can re-examine our position if new evidence comes to light,” Ofcom reported in a statement.

However, the regulator did cite a risk of increased influence by members of the Murdoch family over the UK news agenda and the political process, through its “unique presence” on radio, television, in print and online. That concern could justify a move by the Secretary of State to refer the matter for review by the UK’s Competition and Markets Authority.

The minister has until July 14 to make representations to make a final decision to move forward.

In a statement from 21st Century Fox, the company said its welcomes the secretary of state’s decision on broadcasting standards, but added its disappointment of the minister’s questioning of “undertakings offered by Fox to maintain the editorial independence of Sky News mitigate the media plurality concerns.”

Moving forward, Fox said it will make representations to the secretary of state regarding her provisional decision and Ofcom’s report and will continue to work with UK authorities.

“In the event that the secretary of state makes a final decision to refer to the CMA, we would expect that the review would take at least 24 weeks. In such an event, the transaction is expected to close by June 30, 2018,” the company said.

The proposed acquisition has already been cleared in all markets Sky operates outside of the UK including Germany, Italy, Republic of Ireland and Austria.

Pictured: 21st Century Fox’s Rupert Murdoch

 

About The Author
Barry Walsh is editor and content director for realscreen, and has served as editor of the publication since 2009. With a career in entertainment media that spans two decades, prior to realscreen, he held the associate editor post for now defunct sister publication Boards, which focused on the advertising and commercial production industries. Before Boards, he served as editor of Canadian Music Network, a weekly music industry trade, and as music editor for HMV.com. As content director, he also oversees the development of content for the brand's market-leading events, the Realscreen Summit and Realscreen West, as well as new content initiatives.

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