As 21st Century Fox’s pending $14 billion bid to buy up the remainder of Sky heads to Euro regulators, CEO James Murdoch made the case for the combination being a boon to the U.K.’s creative community and fostering greater diversity in programming.
Murdoch, speaking Thursday to the Deloitte Enders Media & Telecoms 2017 and Beyond conference in London, vowed that the combined company would at minimum maintain the roughly $858 million in content spending that Fox and Sky invested in original production in the U.K. last year. Murdoch’s address comes as the company is expected to formally submit the merger for review to European regulators this week. That process in turn will trigger a review by the British Culture Secretary, who has 10 days to decide whether the deal should be reviewed by the U.K.’s Ofcom media regulator.
“Because the U.K. creative economy has such potential we believe it is the best place to be proposing a nearly ($14) billion investment – which will be a significant driver of the U.K. creative industry’s long-term success in a global market,” Murdoch said. “Looking to the future, we’re confident the enhanced scale and capabilities of the combined company will be a powerful driver of the creative industry’s vibrancy in Britain, plus in Italy, and in Germany, and in the global market, and a provider of better experiences for customers everywhere.”
Murdoch gave a brief rundown of 21st Century Fox’s history, dating back to William Fox’s launch of Fox Film Corporation in 1915. He emphasized the modern company’s track record of innovation in the U.S., Europe and India under his father, 21CF chairman Rupert Murdoch. Fox became a global colossus thanks to “the zeal and curiosity of a founder-entrepreneur of unparalleled vision,” James Murdoch said.
Murdoch’s sales pitch to U.K. investors and media is an effort to get the deal over the PR hurdle that remains because of the last time Fox (then News Corp.) sought to buyout the remaining 61% interest in Sky in 2011. The deal was torpedoed by the scandal that erupted over the phone-hacking at News Corp. newspapers. News Corp. was forced to table its bid amid the public outrage over the conduct of some News Corp. journalists, and James himself came in for heavy criticism as the exec overseeing the U.K. newspaper division at the time.
Six years later, James Murdoch is now CEO of 21CF, the media and entertainment-centric company that was split off from the publishing side of the Murdoch empire in 2012.
Murdoch pressed the point that Sky is focused on investing in the U.K. market and that bringing Sky full into the 21CF fold will enhance its ability to compete with new “entrants armed with fresh capital and a predisposition for disruption … but none of whom have the local depth of investment and commitment to the U.K. and to Europe.”
(Leo Barraclough contributed to this report.)