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Fox’s Plan for Independent Sky News Failed to Convince Authorities, Tripping Up Takeover

In seeking official British approval of its Sky takeover bid, 21st Century Fox offered several concessions, but evidently not enough to convince the government that the deal wouldn’t concentrate too much power in the hands of the new combined entity. Experts also questioned the enforceability of Fox’s pledge to keep Sky News editorially independent.

A report from British media regulator Ofcom, published Thursday, revealed that Fox offered to establish an independent editorial board for Sky News with final say over which stories made it to air, as well as over political comment and opinion. Fox said the Murdoch family and Fox executives would be prohibited from attempting to influence any editorial decisions at the TV news channel, which is seen as a key safeguard given the editorial control Rupert Murdoch has historically exercised over his newspapers, including The Times of London and The Sun.

Ofcom said that, post-merger, Sky News would have a genuine commitment to U.K. broadcasting standards. The regulator also acknowledged that the offer to establish an independent editorial board “mitigated” concerns over Murdoch’s control of the news landscape in the U.K.

However, these assurances “could be strengthened,” said Ofcom, which then concluded that the proposed takeover raised legitimate public-interest concerns on media plurality. Its findings were heeded by Karen Bradley, the British government’s culture secretary, who said she was inclined to refer the deal to competition authorities for further review. That would delay a Fox takeover of Sky by several months at least.

Some media analysts also say that installing a truly independent editorial board, as outlined in Fox’s plan, would be a challenge. Roy Greenslade, a journalism professor and former assistant editor at The Sun, said that a previous pledge by Murdoch to put editorial control of his newspapers at arm’s length proved unsuccessful, although the print and TV operations are fundamentally different and play by different rules.

“When Murdoch took on The Times, he agreed to an independent board. But that didn’t stop him firing an editor without consulting the independent directors,” Greenslade said. “That said, no one can accuse Sky News of showing any bias; they behaved impeccably during the phone-hacking [scandal]. The U.K. broadcasting rules are very clear, and wouldn’t allow Fox to replicate Fox News here.”

The prospect of Sky News turning into the U.K.’s Fox News, with an obvious right-wing bias, has raised alarm in many quarters in Britain, especially among politicians outside the ruling Conservative Party. Earlier this year, former Labour Party leader Ed Miliband warned against a Fox-Sky merger, saying that, “on the grounds of plurality and the record of the Murdoch empire, it should be resisted. This bid would mean significantly greater concentration of media ownership, and it risks the ‘Foxification’ of Sky News.”

Stewart Purvis, former editor-in-chief at ITV for more than three decades, recalled his experience with the relationship between ITV and news producer ITN. ITV is a major shareholder of ITN, and in theory has an arm’s length relationship with the editors at ITN similar to what Fox has proposed for Sky. But in practice, Purvis said, the distance was difficult to enforce.

“It’s difficult to see how separate an organization can be from the group that fully funds it,” he said. “When ITV wanted a budget cut at ITN, it always happened. When they wanted a change of editor, it happened.”

When it comes to shaping the news agenda in Britain, Purvis said that the BBC and ITN also exert huge influence. A merged Fox and Sky would be the U.K.’s third-largest news provider behind those two, reaching 31% of adults, Ofcom said. It would provide 10% of all of the U.K.’s news across all platforms.

“The transaction raises public-interest concerns as a result of the risk of increased influence by members of the Murdoch Family Trust over the U.K. news agenda and the political process, with its unique presence on radio, television, in print and online,” Ofcom said.

Bradley, the culture secretary, said Thursday that she wanted further study of media plurality in connection with the Fox-Sky takeover. But based on Ofcom’s findings in another report, a further investigation is not necessary into whether Fox and the Murdochs would be “fit and proper” owners of a British broadcaster, Bradley said.

Fox and other interested parties now have until July 14 to submit responses to Bradley. After that, she will make her final decision on whether to refer the takeover bid to Britain’s Competition and Markets Authority.

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