Murdoch granted control of BSkyB

Rupert Murdoch. Photo / AP

Rupert Murdoch's News Corporation was yesterday given British Government approval to take full control of pay-TV broadcaster BSkyB, a decision that was derided as a "whitewash" by media rivals.

Culture Secretary Jeremy Hunt had previously said he was minded to refer the proposed £8 billion ($17.6 billion) deal to the competition authorities, but changed his mind after News Corp offered to spin off Sky News into an independent company to appease concerns over a lack of media plurality.

Hunt claimed the spin-off, under which the news channel will be given an independent chairman and board to guarantee its editorial integrity, was a "welcome step forward".

This cut little ice with Murdoch's commercial rivals, who claimed that the Sky News arrangement was only window dressing.

An alliance of companies that includes the publishers of the Daily Telegraph, Daily Mail, Daily Mirror and the Guardian said: "It has been well-documented by former Murdoch editors that arrangements of this kind, including those put in place to protect the independence of the Sunday Times and the Times, have proved wholly ineffective."

Hunt was put in charge of the decision after Vince Cable, the Business Secretary, had to withdraw from the process when he was recorded telling undercover reporters that he had "declared war on Rupert Murdoch".

Hunt had previously said he did not see a problem with the takeover. Ofcom, the media regulator, had voiced concerns that the deal threatened media plurality in the UK, but supported News Corp's Sky News proposal after the company agreed to the idea of an independent chairman.

The failure to refer the deal raised disturbing questions, said Steven Barnett, Professor of Communications at the University of Westminster.

"This deal will create a hugely powerful newspaper, television, online and ISP media conglomerate which will dwarf every other media organisation in the UK, and would not be permissible in most other democracies," he said.

"It is unacceptable that such unaccountable power in the hands of one corporation - and ultimately one man - should be waved through by a Government minister without thorough and independent scrutiny by an independent body."

The spin-off ensures that News Corp provides funding to Sky News for 10 years, as well as retaining a 39 per cent stake which matches its current share in BSkyB.

Lord Fowler, a former Conservative minister and former columnist for the Times, expressed concerns about News Corp's guarantees. "What needs to be established in these inquiries is that it [Sky News] is totally independent. And I'm not utterly convinced that in this case that has been demonstrated," he said.

"I think the fact is that you've got a 40 per cent shareholder sitting there ... with a great deal of influence."

- INDEPENDENT