News Corp's Buyout of BSkyB Essay Example | Topics and Well Written Essays - 2000 words

News Corp's Buyout of BSkyB - Essay Example It will be pertinent to take a note of Rupert Murdoch's British operations, which started a way back in 1969 when the Mirror group wanted to relinquish from its mid-market daily newspaper The Sun. It is precisely at this time when Murdoch acquired it and made it thumping success with the passage of time by selling three million copies per day. Murdoch's control on the print media of UK became more prominent when he acquired The Times and The Sunday Times from Canadian publisher. During the time Murdoch's UK based satellite network Sky television was making huge losses which compelled him to agree for a merger with British Satellite Broadcasting in 1990. The merged company came to be known as BSkyB which is now considered to be the most dominating company in the British pay-TV market. When seen in the above perspective, the news of proposed buyout of BSkyB by Murdoch’s News Corp has far-reaching implications as it may facilitate a near monopolistic control to Murdoch on print a nd electronic media of UK. The point to be noted here is that BBC and other competing media groups have raised their opposition to the deal. It is not surprising that Business Secretary Vince Cable had to bow down on public uproar and ask Ofcom to investigate the matter on the media plurality issues that may arise after this proposed takeover by News Corp. European Union’s antitrust competition regulator also plunged into action to investigate the matter on the grounds of competition. It will be worthwhile to go through some of the important developments that have taken place in the last few months regarding this complete control and take over issue of News Corp. (Prodhan, Georgina et al 2010) The European Commission The European Commission gave its report in the third week of December, 2010 approving the proposed acquisition of BSkyB by News Corporation. The commission in its report concluded that the said transaction of complete control of BSkyB by News Corp is not going to hinder the competition in the European Economic Area (EEA). Its findings were only restricted to the competition aspects and has nothing to do with the proposed investigation carried out by UK regulatory body on media plurality aspect to protect legitimate interest of British nationals. It is pertinent to note here that media plurality assessment and competition assessment are two different areas of investigation. The Competition assessment mainly focuses on whether consumer would be facing any hike in the pricing structures or any forced featureless offerings. On the other hand, the issues related to the media plurality are concerned with the role played by media in relation to the democratic fabric of the various institutions and further their capacity to influence them in their own interests, which may be in the long run detrimental to the health of country. The European Union’s antitrust commission’s main findings are listed as per the following. 1. BSkyB and News Corp are in competition with each other to a limited extent as they are active in different markets in the UK and the Ireland. 2. The commission is of the view that the proposed transaction is not likely to improve substantially BSkyB's existing share of the market in the supply of basic pay-TV channels. 3. Both the parties have a small combined market share in TV advertising hence not going to affect the balancing act in competition concerns. 4. The Commission also investigated the possibility of offering mixed bundles of subscriptions for its print and online versions along with satellite pay channels. The commission is of the view that it will not be possible for the vast majority of newspapers' on line editions are currently free of charge and this equation is not likely