News Corp backs out of BSkyB takeover bid
News Corp has embraced the inevitable in dropping its bid for BSkyB. But it's just another day, another bombsell, in this extraordinary saga, writes Angela Long.
Jeff Randall, immensely likeable business journalist on Sky News, was as usual giving it large. ‘I’ve seen some pretty big mea culpas in my time, but this is the biggest of them all.’
Randall was speaking last Thursday, after the astonishing news that Rupert Murdoch (for don’t think anyone but he called the shot) was closing The News of the World in the wake of a mounting, disgraceful scandal around mobile-phone hacking.
But now, we have an enormous cherry on the top of that sensational cake, as News Corporation announces it is withdrawing its bid to take over all of BSkyB, and hence have total control of Sky News.
This time last week the resiling from the bid would have had jaws on the floor all over the worlds of commerce and media. Today, it is just a logical step, as the Murdochs and News Corp are on the run from a massive and heartfelt tide of public anger.
Like me, Jeff Randall worked for The Sunday Times some 20 years ago at Fortress Wapping, In those dear distant days, the height of rascally or unethical behaviour by the bad boys at Wapping, The Sun and the NOTW, was the headline ‘Gotcha!’ on page one of The Sun when the Argentine battleship the Belgrano was sunk during the Falklands War (with the loss of hundreds of lives).
Tut tut. But the editor at the time, Kelvin Mackenzie, was hugely proud of the headline and it became iconic, summing up the cheeky disregard for propriety that the British redtops personified.
Now ‘the sorry saga of the BSkyB takeover bid’, as it is being described in Britain’s House of Commons as I write, has fallen victim to the culture of disregard for standards and ethics that spiralled out of control into criminal and immoral behaviour.
The obvious people we have to thank for that, setting aside their denials, are Sun and NOTW editors Andy Coulson and Rebekah Brooks. Such ambitious people, who – particularly Brooks – identified so whole-heartedly with the company for which they worked, were the stormtroopers in Rupert Murdoch’s campaign to take over and control more, more, more of the media, be it newspapers or broadcast.
But the attempt to control all of BSkyB by buying the 61% of shares News Corp did not already own has been brought down in flames. News Corp shares sank by 14% earlier this week, but recovered on the announcement of the abandonment of the bid today (Wednesday).
Murdoch might seem to have lost his reason in his affectionate support for the flame-haired Mrs Brooks, who presided over the culture of illegal phone-hacking. It has unravelled his patient and determined attempts to get BSkyB in toto.
The bid was launched last June, when Murdoch (Rupert, but also James, his son and chairman of News International in Britain) offered €7.7 (US$10.82) a share, for a total outlay of more than €9 billion. Immediately people started shouting about domination of the market – Murdoch already owned four national newspapers as well as The Times Literary Supplement, and had an unashamed interest in wielding power. Other media groups expressed their horror and joined together to lobby against the government allowing the takeover.
Permission was needed from Ofcom, the British media regulator. This duly came, with Ofcom releasing a statement that it felt the proposal answered concerns about market domination.
However the key figure was Culture Secretary Jeremy Hunt, generally regarded as someone who would do what was required. He had succeeded Liberal Democrat Vince Cable in overseeing the bid vetting. Cable had disqualified himself by telling two undercover reporters (he did not, of course, know they were spies) that he had ‘declared war’ on Murdoch. Twitter today, of course, was wondering if latest developments mean that although Cable lost a battle, he has now won that war.
Hunt was widely expected to announce this month that the News Corp bid had succeeded. But once the news broke of the hacking of the phones of Milly Dowler and other victims of murder, the storm of protest meant that at the very least the bid would have to go before the Competition Commission. News Corp’s announcement today that its bid was off the table avoided what would have been for the company a very unpleasant and protracted course.
Now what does all this mean for Ireland? We no longer have our own Sky News – the experiment lasted about two years, and was scrapped. But The Sunday Times sells more than The Irish Times, and The Irish Sun also has a healthy circulation.
Sammy Wilson of the DUP had his say during the long and passionate debate in the British parliament today. He pointed out the degree to which prime ministers and politicians of all parties had ‘pandered’ to the likes of Murdoch, including other large proprietors.
But perhaps the most prescient and chilling contribution came from the MP who warned that News Corp might return to the scene – but that all politicians should be wary of forming too-close links with behemoths such as Google and Facebook in the future.
For speculation on what News Corp might do next, see this New York Times report.
For British PM David Cameron’s statement today on inquiries into the NOTW scandal, read this.
Image top: Mitchell_Hall.