Rupert Murdoch’s US-based News Corp has dropped its $12bn bid to take over the 61% of British Sky Broadcasting (BSkyB) it doesn’t already own. “It is too difficult to progress in this climate,” said News Corp chairman Chase Carey. Murdoch had come under mounting political pressure to withdraw the bid, as the phone hacking scandal had shown no sign of dying down after he pulled the plug on the News of the World last week.
Murdoch attempted to play for time by triggering an enquiry into the bid by the Competition Commission. Meanwhile, telecoms regulator Ofcom was to investigate whether News Corp was considered “fit and proper” to take over BSkyB. Then parliament scheduled a (non-binding) vote on a motion calling for him to withdraw his offer, with all three party leaders saying they supported the move. The bid was ditched shortly before the vote. A US senator called for an inquiry into News Corp following reports that victims of the September 11th attacks may have had their phones hacked.
What the commentators said
This will have been “incredibly painful” for Murdoch, said Robert Peston on BBC.co.uk. He has been “desperate” to get his hands on BskyB. It’s a successful business that throws off “vast sums of cash”, as Nils Pratley pointed out in The Guardian. News Corp wants to integrate its satellite businesses around the world, which would only be feasible with full control of BSkyB, “the original and most profitable… of the Sky family”.
Still, it’s clear from the News Corp statement that he hasn’t given up on taking over BSkyB, as Reuters.com pointed out. He may just be biding his time. The likelihood is that, over time, “especially now that the power of his newspapers has been so aggressively challenged”, he will cease to be a hate figure, said Daniel Knowles on Telegraph.co.uk. Then he could make a new bid.
But while Murdoch may have lowered the political temperature in Britain, could he face trouble in the US? A statement by White House ally Senator Jay Rockefeller hints that there will be an investigation, said Toby Harnden on Telegraph.co.uk, and “all but says that News Corp will be history if it turns out that any American citizen had his phone hacked”. This could be “very bad indeed” for Murdoch.