Murdoch wins again

The News Corp head is now free to create a £6.4bn media giant.

The Dirty Digger has won again. Jeremy Hunt has given Rupert Murdoch the green light to buy the 61 per cent of BSkyB he does not already own.

The inevitable concession is a fairly minor one. Sky News will be "spun off" into a new company listed on the stock market, with a new board made up of a majority of independent directors. In addition, News Corp will be blocked from increasing its shareholding in the new company (currently 39.1 per cent) without permission from the Secretary of State for ten years.

For Murdoch, this is little more than an inconvenience. He has won the opportunity to create a new £6.4bn media giant, the likes of which Britain has never seen. As the graphic below shows, the revenues of a combined BSkyB and News International would dwarf those of the BBC.

Media companies by revenue

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And, as former NS editor Peter Wilby notes in this week's magazine, there is nothing in the agreement to prevent Murdoch bundling up subscriptions to his newspapers with subscriptions to Sky. However, while the regulatory hurdles have been removed, the News Corp head still has to persuade BSkyB's shareholders to sell. The current offer of 700p per share is viewed as far too low, not least because BSkyB profits rose by 26 per cent to £467m in the last six months of 2010, with revenues up 15 per cent to £3.2bn. But with News Corp in rude health, largely thanks to bumper profits from its filmmaking division, Murdoch is likely to make a significantly improved offer.

Eight days short of his 80th birthday, and with one of his tabloids the subject of a police investigation, he has outplayed them all again.

George Eaton is political editor of the New Statesman.

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Martin Sorrell: I support a second EU referendum

If the economy is not in great shape after two years, public opinion on Brexit could yet shift, says the WPP head.

On Labour’s weakness, if you take the market economy analogy, if you don’t have vigorous competitors you have a monopoly. That’s not good for prices and certainly not for competition. It breeds inefficiency, apathy, complacency, even arrogance. That applies to politics too.

A new party? Maybe, but Tom Friedman has a view that parties have outlived their purpose and with the changes that have taken place through globalisation, and will do through automation, what’s necessary is for parties not to realign but for new organisations and new structures to be developed.

Britain leaving the EU with no deal is a strong possibility. A lot of observers believe that will be the case, that it’s too complex a thing to work out within two years. To extend it beyond two years you need 27 states to approve.

The other thing one has to bear in mind is what’s going to happen to the EU over the next two years. There’s the French event to come, the German event and the possibility of an Italian event: an election or a referendum. If Le Pen was to win or if Merkel couldn’t form a government or if the Renzi and Berlusconi coalition lost out to Cinque Stelle, it might be a very different story. I think the EU could absorb a Portuguese exit or a Greek exit, or maybe even both of them exiting, I don’t think either the euro or the EU could withstand an Italian exit, which if Cinque Stelle was in control you might well see.

Whatever you think the long-term result would be, and I think the UK would grow faster inside than outside, even if Britain were to be faster outside, to get to that point is going to take a long time. The odds are there will be a period of disruption over the next two years and beyond. If we have a hard exit, which I think is the most likely outcome, it could be quite unpleasant in the short to medium term.

Personally, I do support a second referendum. Richard Branson says so, Tony Blair says so. I think the odds are diminishing all the time and with the triggering of Article 50 it will take another lurch down. But if things don’t get well over the two years, if the economy is not in great shape, maybe there will be a Brexit check at the end.

Martin Sorrell is the chairman and chief executive of WPP.

As told to George Eaton.

This article first appeared in the 30 March 2017 issue of the New Statesman, Wanted: an opposition