It was a dream of Rupert Murdoch’s for many years, and now it may have been put on ice.
The 86-year-old’s attempt to completely take over Sky, the massive British telecommunications company, hit a major snag on Tuesday when it was provisionally rejected by the United Kingdom’s Competition and Markets Authority, which deemed that the deal was “not in the public interest” because Murdoch already plays too influential a role in the country’s media.
The Authority will make its final recommendation on the deal to the U.K. Culture Secretary on May 1, who will then decide whether it gets a green light.
Murdoch made the $16 billion bid, which began in December 2016, through 21st Century Fox, which he runs with his sons James and Lachlan.
Fox already owns 39 percent of Sky, which is the U.K.’s country’s most popular pay-TV service as well as a broadband and mobile phone service provider. But Murdoch recently agreed to sell most of Fox to Disney in a tectonic, $52.4 billion deal. That transaction, which still needs to pass regulatory muster, makes Murdoch’s stake in Tuesday’s ruling less urgent, since his portion of Sky is included in it. This means that Disney will likely be left with either Murdoch’s current share of Sky or, if his bid does go through in the end, all of it.
But if the Disney-Fox deal hits the skids, Murdoch would retain control of his Sky stake — which is what the U.K. regulator had in mind in its Tuesday decision.
It ruled that with Murdoch’s already-considerable influence on the media landscape — he owns the popular tabloid the Sun, the more serious-minded Times, and the Sunday Times — the deal would give him “too much control over news providers in the UK across all media platforms and therefore too much influence over public opinion and the political agenda.”
This was not necessarily the obstacle that observers had been expecting. Murdoch could well have been rejected on different grounds: that his companies were not morally responsible enough to be handed the reins to another conglomerate. Murdoch owned the News of the World when it was involved in a lurid phone-hacking scandal that ended with his closing the newspaper altogether. And, of course, he controls Fox News, which has been under fire for its rampant culture of sexual harassment, not to mention its propagandistic political slant.
But the Authority didn’t seem perturbed by problems of culture, focusing instead on the competition issue.
In a statement, Fox said, “We welcome the CMA’s provisional finding that the company has a genuine commitment to broadcasting standards and the transaction would not be against the public interest in this respect. Regarding plurality, we are disappointed by the CMA’s provisional findings. We will continue to engage with the CMA ahead of the publication of the final report in May.”
The deal could still happen, but not without serious modifications. These could involve Sky News being spun off from Sky to prevent more Murdoch fingerprints on the country’s journalism industry.