Ev­ery­thing’s up in the air - es­pe­cially Sky News

The Observer - - BUSINESS -

The prob­lem, grim warn­ings aside, isn’t whether Ru­pert Mur­doch will pull the plug on Sky News if his plan to buy the whole satel­lite shooting match is thwarted. The prob­lem is whether he’ll still want to own 39% of Sky – and whether who­ever picks up the pieces will want to pre­serve a loss-mak­ing news chan­nel.

We learned last week that 21st Cen­tury Fox has had so far abortive talks with the much might­ier Dis­ney cor­po­ra­tion, which wants to buy its movie busi­ness, its TV and film stu­dios, plus an as­sort­ment of satel­lite en­ter­prises, pos­si­bly in­clud­ing Sky.

So Mur­doch may no longer be the buyer; he may be a seller re­treat­ing into a cable news and sport bunker.

Be­ware too many leaps of the imag­i­na­tion here. Per­haps there’s a rift in the fam­ily, with young James out of favour; per­haps this is pru­dent suc­ces­sion plan­ning; per­haps there are more sur­prises in store. But even a glance at Fox’s lat­est quar­terly re­sults (ending 30 Septem­ber) make an in­dica­tive case. Film tak­ings ob­vi­ously go up and down: one huge hit can trans­form a balance sheet. But there are no trans­for­ma­tions so far this year on the Hollywood beat – nor any sign of bur­geon­ing life on con­ven­tional TV as ad­ver­tis­ing slumps and the might of Net­flix, Ama­zon and Google comes rolling in. Con­tent is king in this new stream­ing world. Put Dis­ney and 21st Cen­tury Fox to­gether and they have well over a quar­ter of the Tin­sel­town con­tent mar­ket. You can see why Dis­ney is in­ter­ested. “Its pur­suit of 21st Cen­tury Fox Inc’s en­ter­tain­ment as­sets in­di­cates that repo­si­tion­ing its tele­vi­sion busi­ness to com­pete in the stream­ing, a-la-carte world Net­flix dom­i­nates has be­come Dis­ney’s top pri­or­ity,” said Ru­pert’s own Wall Street Jour­nal. It’s not so cer­tain though, un­less the stalled talks re­sume, who else would be truly in­ter­ested in pick-and-mix bid­ding for Mur­doch as­sets. Nor is the fu­ture of the hived-off print news com­pany very clear un­less it con­trives a surge in dig­i­tal reach and rev­enues. Ev­ery­thing’s up in the air; ev­ery­thing’s to play for. You can be a gi­ant op­er­a­tion spread far and wide – and also too rel­a­tively small to cope.

And where is Sky News in the scheme of such things? It’s a prospec­tive pawn for sac­ri­fice as nec­es­sary, a good deed that can be wiped away if the stakes are high enough. The whole Mur­doch saga, in sum, is mov­ing on fast. His fa­mil­iar cho­rus of crit­ics would be shrewd to move like­wise.

All­star

Fox pro­duc­tion Mur­der on the Ori­ent Ex­press, star­ring Michelle Pfeif­fer, may not be enough to keep Ru­pert Mur­doch on top.

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