Murdoch's empire probed over ITV stake

The British arm of Rupert Murdoch's newspaper empire will be investigated by the Competition Commission over BSkyB's stake in ITV.

The regulator launched its inquiry in May after the Office of Fair Trading and Ofcom said Sky's 17.9 per cent holding raised "significant" competition and public interest concerns.

Sky's £940 million move last November also caused controversy after scuppering Virgin Media's ITV merger plans, drawing fire from major Virgin Media shareholder Sir Richard Branson.

News International, part of Murdoch's News Corporation, owns British papers including The Times, the Sunday Times, the Sun and the News of the World.

The regulator will probe the "ownership link" created between the news groups and whether "this could lead to a reduction in the plurality of provision of news and/or current affairs within the UK as a whole".

The commission said it had initially identified six potential ways in which Sky's holding could result in a "substantial lessening of competition", although it stressed it had yet to reach any conclusions.

The list covers the possible loss of competition in the premium pay-TV market, the sports rights bidding process and the provision of television news, with the holding creating a link between Sky News and ITN, which provides news to ITV.

Rival broadcasters have condemned Sky's ITV holding in their submissions to the Competition Commission, published last Friday.

Channel 4 said it believed the acquisition will lead to a "substantial lessening of competition in UK broadcasting", while the BBC said in its submission that its "greatest public interest concern remains with regard to plurality of voice in the provision of news".

The National Union of Journalists also said in a joint Ofcom submission with the Campaign for Press and Broadcasting Freedom that News International "already has a 'disproportionate' share of control over the provision of news and current affairs reporting through broadcasting, newspaper and online services".

Sky maintains that the ITV stake is merely a long-term investment and claims it has not broken any merger rules.

The commission aims to report back with preliminary findings in mid-September, with the deadline for its final report to be sent to the newly-created Department of Business, Enterprise and Regulatory Reform by November 7.

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