Deal or no deal, Sky is reg­u­la­tors’ hard­est ever test

The Observer - - BUSINESS - Peter Pre­ston

Weak gov­ern­ments put off mak­ing tough choices. Which is ob­vi­ously one rea­son why the cul­ture sec­re­tary plants more acres of long grass when­ever the next de­ci­sions about the Mur­doch takeover of Sky have to be taken. Is Ru­pert too pow­er­ful, a po­lit­i­cal pup­pet mas­ter? Hardly. He can’t even get Tory min­is­ters danc­ing to his tune these days.

It was al­ways pretty likely that Karen Bradley would take the long, high road of non-ap­proval, go­ing to Of­com, pon­der­ing for months, then re­fer­ring the deal to the Com­pe­ti­tion and Mar­kets Author­ity, led by a for­mer Of­com chair. Ex­pect six months more pon­der­ing, with maybe a few ex­tra weeks on top. It’s a weird way for an al­legedly buc­ca­neer­ing Brexit na­tion to do busi­ness.

The CMA will face two is­sues. Does all of Sky, plus news-pro­vi­sion con­tracts, plus the re­main­ing Mur­doch press em­pire, rep­re­sent a diminu­tion of me­dia plu­ral­ity? And, a new com­pli­ca­tion: is the po­ten­tial “Fox­i­fi­ca­tion” of Sky News a dan­ger­ous pos­si­bil­ity, with “broad­cast­ing stan­dards” in pawn?

“En­ti­ties which adopt con­tro­ver­sial or par­ti­san ap­proaches to news and cur­rent af­fairs in other ju­ris­dic­tions should, at the same time, have a gen­uine com­mit­ment to broad­cast­ing stan­dards here,” Bradley says.

The grass grows even longer. A reg­u­la­tor can cal­cu­late mar­ket shares and reach a con­clu­sion. But how do you de­cide whether the tox­i­c­ity of Fox News in New York will in­fect in­no­cent Bri­tish out­lets?

There’s a rich stew of ar­gu­ments here. Some peo­ple don’t trust the fam­ily Mur­doch un­der any cir­cum­stances. Some are hor­ri­fied by the rash of fe­male as­saults and fat le­gal set­tle­ments that dog Fox News. Some re­mem­ber phone hack­ing. Some are in­censed by the way Fox tol­er­ates phoney sto­ries that keep its Trump fires burn­ing. Some see Mur­doch cor­po­rate slop seep­ing into Bri­tain. Some have old po­lit­i­cal scores to set­tle. And Of­com doesn’t like the way the chan­nel re­peat­edly promised to com­ply with Bri­tish stan­dards, then did noth­ing.

Can so many charges ever be rec­on­ciled? Per­haps not. Ed Miliband, a leader of the Thwart Ru­pert cam­paign, sees no reg­u­la­tory end in sight. “Our broad­cast­ing code is not enough pro­tec­tion be­cause its im­par­tial­ity rules can’t take ac­count of story se­lec­tion, tone or promi­nence. And an ag­gres­sive me­dia owner can push the lim­its. The way to pre­vent ... the ‘Fox­i­fi­ca­tion’ of Sky is to stop the bid.”

Pro­fes­sor Steven Bar­nett, a longterm Mur­doch foe, tears into Of­com for ar­gu­ing that broad­cast­ing stan­dards were not en­dan­gered here. “A supine reg­u­la­tor ap­pears to have been cap­tured by its most pow­er­ful stake­holder, while a ro­bust gov­ern­ment looks de­ter­mined to stand up for the pub­lic in­ter­est.”

But do Ed and the pro­fes­sor recog­nise a dou­ble-edged sword wav­ing un­der their noses? Anger over “story se­lec­tion, tone and promi­nence” is ex­actly the beef of ram­pant Brex­iters try­ing to in­tim­i­date the BBC. Of­com, af­ter the last char­ter re­newal, is the BBC’s shield against power plays by a “ro­bust gov­ern­ment”.

Bradley has set a pro­found test for Bri­tish me­dia reg­u­la­tion. De­fine plu­ral­ity in an era of shrink­ing print in­flu­ence. And es­tab­lish clear prin­ci­ples of me­dia con­duct as they cross bor­ders.

The City and Wall Street are still rat­ing even­tual ap­proval a 70% chance. That’s prob­a­bly Bradley’s pri­vate bet, too. But now – per­haps more im­por­tant than deal or no deal – is the mo­ment of truth for reg­u­la­tory de­fences built over decades. Can they be tough and clear – and prin­ci­pled?

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