Ofcom clears BSkyB, part-owned by News Corp, but slams James Murdoch

British media regulator clears BSkyB but slams reaction of tycoon's son to hacking scandal

PUBLISHED : Friday, 21 September, 2012, 12:00am
UPDATED : Friday, 21 September, 2012, 4:31am


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British Sky Broadcasting Group gained approval to keep its broadcast licence, a regulator ruled, while criticising board member James Murdoch's reaction to phone-hacking revelations at News Corporation, which owns 39 per cent of the pay-television operator.

"We consider James Murdoch's conduct … to be both difficult to comprehend and ill-judged," British media watchdog Ofcom said yesterday.

In the wake of the scandal, Murdoch resigned as chairman of News Corp's British newspaper arm and then as chairman of BSkyB. News Corp was forced to abandon a £7.8-billion (HK$98.16 billion) bid to take control of BSkyB last year amid allegations that its employees had hacked phones and computers and bribed public officials.

"After a lengthy review process, we are pleased that Ofcom has now reached its conclusion and we look forward to continuing to develop our business," BSkyB said.

Murdoch, who had previously also been CEO of BSkyB, oversaw News Corp's newspaper group while the firm repeatedly denied that widespread hacking had taken place. News Corp said that while it appreciates the decision to allow BSkyB to keep its licence, allegations that Murdoch failed in his duties as a director are not backed by evidence.

"James deserves credit for his role … in leading Sky to an outstanding record as a broadcaster, including its excellent compliance record," News Corp said.

Ofcom's interest in News Corp's control over BSkyB, and the potential to reopen the investigation, could make it more difficult for News Corp to make another attempt to buy all of the pay-television operator, said Claudio Aspesi, an analyst at Sanford C. Bernstein.

Former News Corp executives are not slated to go on trial until at least next year, while police inquiries could last for at least another three years.