A cu?t by any other name...

 Rupert Murdoch has been given the go-ahead to takeover BSkyB. After months of speculation and discussion, Culture Secretary Jeremy Hunt- I said Hunt- announced that News Corp has been given approval to buy the remaining 61% shares in a deal worth £9.1 billion. The news of the deal has inevitably brought criticism from the Labour Party and other media groups, but what does it actually mean to us?

From the moment that Vince Cable was caught in a Telegraph honey trap it was probably inevitable that an agreement would be reached. You may remember that Cable made a fool of himself by  bragging to young female reporters that he was "declaring war" on Murdoch. Cable was immediately replaced from the BSkyB decision-making process and authority was given to Jeremy Hunt and he was on record as stating that Murdoch had "probably done more to create variety and choice in British TV than any other single person." Hunt has also been a strong critic of the BBC.

In December, Ofcom, the communications industry regulator, concluded that the proposed takeover would operate against the public interest 'since there may not be a sufficient plurality of persons with control of media enterprises providing news and current affairs to UK-wide cross-media audiences.' In order to avoid the deal being referred to the Competition Commission, News Corp have offered to create a new company, Sky News, with an independent chairman and directors.

Hunt

How independent is the new company? News Corp will keep a 39% holding in Sky News and will not be allowed to increase its holding without the permission of the culture secretary for ten years. Sky has also agreed to provide a 'substantial revenue stream', in the shape of a ten year contract to buy Sky News services and to allow it use the 'Sky News' brand for the next seven years. So, News Corp will almost certainly remain the largest shareholder and it will also be the new company's biggest client. Not exactly a strong position from which to assert its editorial independence is it?

But independence and Murdoch are hardly synonymous. Andrew Neil, the former editor of the Sunday Times and founding chairman of Sky TV has spoken extensively about Murdoch's record for removing 'independent' directors and directing the editorial policy of his papers. In 2008 The Independent reported that Neil told a Lord's committee,

"If you want to know what Rupert Murdoch really thinks read the editorials in the Sun and the New York Post because he is editor-in-chief of these papers. There is no major geopolitical position that the Sun will take whether its attitude to the euro or to the current European treaty or to whom the paper will support in the upcoming general election. None of that can be decided without Rupert Murdoch's major input."

The BBC's Robert Peston stated that the deal meant "huge changes to the landscape of the British media industry." However, Peston noted that News Corp had been put under pressure to make greater concessions than they were originally willing to concede. All of the key documents have been published and Hunt's office should, I think, be applauded for that transparency. Both Ofcom and OFT agreed that referral to the Competition Commission was not necessary.

What is certainly worrying, however, as Peston points out, is the takeover will mean News Corp will have revenues that dwarf all of its competitors, even the BBC. Murdoch has not been averse to taking on his competitors in a series of price cutting wars strangling newspaper revenues. In 2002 the Murdoch controlled Sun saw its revenues fall by 50% in a price war with the Mirror, however, News Corp, owners of Fox TV and 20th Century Fox, in the USA, were able to cover those losses.

Meanwhile, a number of media groups, including the Guardian, Associated Newspapers and the Telegraph - who initially tried to cover up the Vince Cable gaffe - in a joint statement to the BBC said, "We shall be vigorously contesting this whitewash of a proposal during the consultation period, as well as examining all legal options."

What does it all mean? Firstly, the deal has yet to be completed. News Corp still have to buy BSky B and with the rising share price that is not a certainty. As a viewer, it won't make any difference. As someone concerned about the independence of news broadcasting, there are obvious concerns. However, given the concessions, Sky News is pretty much in the same position it always was, or, if there is any strength to the restrictions on News Corp, it will actually be in a much stronger position.

Of course, people tend to agree with political bias in reporting, if it agrees with their own views. The Telegraph, after all were only acting in a self-interested way by trying to hide the Cable gaff. The independence of our media can be over-stated. In the noise of the BSkyB announcement you may have missed a smaller but just as interesting story. After pressure from the Conservatives, BBC journalists have been told to stop referring to 'cuts' and instead use the word 'savings' to paint a more rosy picture of government announcements. Senior BBC management are reported to have said that 'cuts' made the news appear too negative. Even our cherished Auntie has to pay the piper.

Ultimately, the greatest threat will emerge from the financial muscle that News Corp has at its disposal and how it chooses to tackle its competition. How it will end is anyone's guess. One thing is for certain. Murdoch is nearly 80 and, although he increasingly resembles a Bond villain, I suspect that You only Live Twice, is still only true in spy fiction.