BSkyB Expected To Face Competition Commission

Broadcasting giant BSkyB has been warned it could be subject to the scrutiny of the Competition Commission following its high profile snap acquisition of an 18% holding in ITV, which it is thought will be ruled to be against the interests of competition and hence struck down.

The warning comes following the delivery of the final report by the competition regulator into the transaction, which was sent to the government authorities at the end of last week and is expected to be made public before the end of the year.

Following a preliminary ruling that the arrangement would be contrary to the interests of competition, the government has said it will look to deliver final judgement on the matter over the next few weeks, citing the detriment of public interest as its main reason for ruling initially against the move.

It is thought that the involvement of BSkyB, whilst not necessarily in the day to day running of the organisation, would still be felt in determining long term strategic objectives, which would be ultimately against the interests of fairness and competitiveness in the media and the stock market generally.

Secretary for Business John Hutton is expected to deliver his final verdict following the government’s ruling on the matter although at present it is expected that the move wil be dismissed and BSkyB will be ordered to sell off its holding in the independent media company.

Shares in ITV, which runs advertising supported TV content throughout the UK whilst owning a number of other holdings, have been significantly depressed since the stake was purchased by Rupert Murdoch’s BSkyB.

It remains to be seen whether the government will follow analysts expectations by ruling the move anti-competitive, and indeed what remedies will be taken to resolve the situation.

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