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Monday, July 11, 2011

How can ministers make the BSkyB deal go away?

How can ministers make the BSkyB deal go away?

By Norman Smith Chief political correspondent, BBC Radio 4

Ministers are understandably nervous about taking on Rupert Murdoch

Politicians take on Rupert Murdoch at their peril.

No wonder, therefore, that the government is desperately looking for some political cover before breaking the bad news to the boss of News Corporation that his bid for BSkyB is no longer welcome.

For ministers are under no illusion that - given the nature of the hacking allegations and the public fury they have aroused - the deal has to be blocked or irretrievably delayed.

So they have been desperately wrestling with what is the best way of blocking the deal without actually having to offend Mr Murdoch.

The answer appears to be to lob the political time bomb that is the BSkyB deal to the Competition Commission to defuse.

Although Culture Secretary Jeremy Hunt told MPs that the planned buy out of BSkyB would now be referred to the competition regulator, privately the view in government is that whatever it decides the deal cannot be allowed to go ahead.

The slight danger with this strategy is that it looks suspiciously like buck-passing.

In short, as if ministers are hiding behind the sofa and leaving luckless souls elsewhere to do their dirty work.

Criminal convictions

Another problem with this approach is that the regulator may not actually deliver the coup de grace to the BSkyB buyout that the government needs.

And any decision it takes would eventually have to be approved by Mr Hunt.

In other words, Mr Hunt would have to emerge from behind the sofa and the government would have to square up to Mr Murdoch

As for other potential solutions to the government's problem, media regulator Ofcom has traditionally proved remarkably reluctant to block deals on the grounds that potential buyers are not "fit and proper" persons.

Indeed, it usually only does so if the buyer has a criminal conviction.

Hence it stopped the business man Owen Oyston from buying several radio stations because of a conviction for rape.

But Team Murdoch have not been convicted of anything, so it seems rather unlikely the Ofcom will block the deal.

Glacial speed

The most likely strategy therefore is delay, delay, delay.

Ministers will simply drag their feet in a fashion that would exhaust the patience of a saint.

The hope being that Mr Murdoch and his advisers will observe the glacial progress of the buyout deal and conclude - rightly - that ministers really don't want News Corporation to proceed with it.

The hope in government circles is that Mr Murdoch - faced with such public and political opposition - will himself decide to drop his planned buyout

It may not be very heroic.

But the view in government circles is that at least this way they scupper the deal while also avoiding a direct head-to-head confrontation with Mr Murdoch.

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