Rupert Murdoch faces backlash from rival newspaper owners amid fears £8bn BSkyB buyout will lead to NewsCorp domination
It would be "fanciful" to expect a separately owned Sky News to be properly independent of Rupert Murdoch's News Corporation, according to lawyers acting for a group of four normally competing newspaper owners in a submission opposing the media mogul's £8bn buyout of BSkyB.
Writing on behalf of the companies behind the Daily Telegraph, the Daily Mirror, the Daily Mail and the Guardian, Slaughter and May said that a proposal to split off Sky News would not be enough to address fears that Rupert Murdoch would dominate British media once his NewsCorp bought all of the satellite broadcaster.
The joint submission – also supported by BT – said that NewsCorp's offer would "make Sky News almost entirely dependent on News Corporation" and that "it would be fanciful to expect that Sky News will enjoy any meaningful independence" that would allow it to contribute to diversity in news provision in the future.
As a result, Slaughter and May said, it would be "clearly unrealistic" to expect that Sky News would "rigorously investigate" if, for example, another News of the World phone hacking scandal emerged.
The lawyers also questioned whether, if all Murdoch's newspapers supported one political party in a future election campaign, it would be "realistic to expect that Sky News would rigorously investigate and report on a major scandal affecting that party".
Earlier this month, the culture secretary, Jeremy Hunt, said that, in principle, he would allow NewsCorp's bid for BSkyB to go through if Rupert Murdoch were to agree to the spinning-off of Sky News. NewsCorp's holding in Sky News would be capped at 39.1% – equivalent to its current ownership of BSkyB – for at least 10 years.
Yesterday was the last day for anybody objecting to that plan to register their concerns formally with Hunt.
The newspaper owners and BT had long been unhappy about the bid which, they argue, would lead to the creation of a powerful integrated media group combining more than one in three of every newspapers sold in the UK with the largest broadcaster as measured by turnover.
Sky News would be financially dependent on NewsCorp because it would rely on the media group for an estimated 85% of its revenues under the spin-off plan, the submission said, meaning that Sky News "cannot be considered financially or commercially independent of News Corporation where the latter is by far its largest customer". Sky News would therefore be unable to disgregard News Corp's views as a result, the document added.
The news channel would also be dependent on News Corporation for its distribution – although the draft undertaking proposed by NewsCorp gives no details as to how this would work in practice.
In addition, Sky News would be dependent on winning a renewal of its contract with News Corp, an "absolute imperative" that "will profoundly influence decision-making at all levels within Sky News".
There was also criticism that there would be only weak safeguards of editorial independence, because the directors who were given that job would have other legal obligations requiring them to maintain the financial health of the business.
Slaughter and May noted that separate editorial undertakings given to safeguard the independence of the Times and Sunday Times when they were purchased by Murdoch in 1981 were ineffective, according to evidence previously provided to Ofcom, the communications regulator, by Harold Evans, a former editor of the Times, and Andrew Neil, who previously edited the Sunday Times.
A spokeswoman for News Corporation said the company "had submitted a comprehensive proposal which, Ofcom has acknowledged, addresses the plurality concerns identified. We remain committed to engaging in the regulatory process."
The department of culture said that it would not comment on individual submissions while it was still deciding whether to accept the proposed remedy. Jeremy Hunt is expected to make his final ruling on whether to formally accept the Sky News spin-off plan in April.
Number of weekly viewers:
TV BBC 33.5 million, ITN 21.9m, Sky News 11.7m
Radio BBC 34.2m, Sky News 33.4m
Newspapers (readership figures): News Corporation 14.5m, Daily Mail & General Trust 7.3m, Trinity Mirror 6.8m
Online: BBC 12m, Daily Mail 5.5m, News Corp 4.6m
Source: Ofcom
*readership figures