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Murdoch bovvered?

Posted in Media, Branwell Johnson, Latest reporters' blogs October 2nd, 2007 by Branwell Johnson

Is James Murdoch bovvered that the Competition Commission looks set to block BSkyB’s stake in ITV? The CC has “provisionally” (lovely word – covers a multitude of meanings) found that Sky’s 17.9 per cent stake restricts competition and operates against the public interest.

But it is unlikely Murdoch didn’t foresee this outcome when he made his tactical move – I call it tactical because I don’t believe there was a long term vision behind it. He and his team must be acting as surprised as someone reaching 100 and getting a letter marked “Buckingham Palace.”

Sky’s stake was taken to block Virgin Media’s underleveraged £4.7 billion bid for ITV. Sir Richard Branson wants to be a TV mogul, he’s certainly given up on retailing music and his train sets are being taken away, and at that point, before Michael Grade became executive chairman, ITV looked particular vulnerable. Now, with a CRR review looming and Rupert Howell on board handling the commercial and brand teams, Grade appears to have created a stronger ship.

It’s not inconceivable that Murdoch just wanted to use the Sky stake to bind up ITV in reams of red tape, reports and investigations, all aimed at delaying any bids, particularly from Branson. Does it matter that Sky may have to disinvest? I’d say nope, particularly if the shares are up and Murdoch comes out with a profit.

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