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Anticipated Acquisition by 21St Century Fox, Inc of Sky Plc

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Anticipated Acquisition by 21St Century Fox, Inc of Sky Plc Anticipated acquisition by 21st Century Fox, Inc of Sky Plc Provisional findings report Notified: 23 January 2018 © Crown copyright 2018 You may reuse this information (not including logos) free of charge in any format or medium, under the terms of the Open government Licence. To view this licence, visit www.nationalarchives.gov.uk/doc/open-government- licence/ or write to the Information Policy Team, The National Archives, Kew, London TW9 4DU, or email: [email protected]. The Competition and Markets Authority has excluded from this published version of the provisional findings report information which the inquiry group considers should be excluded having regard to the three considerations set out in section 244 of the Enterprise Act 2002 (specified information: considerations relevant to disclosure). The omissions are indicated by []. [Some numbers have been replaced by a range. These are shown in square brackets.] Contents Page Summary .................................................................................................................... 7 Reference ................................................................................................................... 7 Background ................................................................................................................ 8 The Parties ........................................................................................................... 8 Fox .................................................................................................................. 8 Sky .................................................................................................................. 8 Related parties ................................................................................................ 9 The Transaction .................................................................................................... 9 Rationale ............................................................................................................... 9 Jurisdiction and counterfactual ........................................................................... 10 Media plurality .......................................................................................................... 10 Assessment framework and potential harm from loss of plurality ....................... 11 The MFT’s control over Sky ................................................................................ 13 Internal plurality and other contextual factors ................................................ 15 Provisional conclusion on the change in the actual extent of the MFT’s control post Transaction ........................................................................................... 17 UK news media landscape ................................................................................. 18 Ensuring that there is diversity in the viewpoints that are available and consumed ........................................................................................................................... 19 Availability...................................................................................................... 20 Reach ............................................................................................................ 20 Consumption ................................................................................................. 21 Assessment of other news providers ............................................................. 22 Preventing any one media owner, or voice, having too much influence over public opinion and the political agenda ........................................................................ 23 Assessment of sufficiency and provisional conclusion on the media plurality consideration ..................................................................................................... 25 Genuine commitment to the attainment of broadcasting standards ......................... 28 Framework for our assessment........................................................................... 29 Broadcasting standards in the UK....................................................................... 30 Fox ................................................................................................................ 31 Sky ................................................................................................................ 34 Broadcasting standards outside the UK .............................................................. 35 Fox ................................................................................................................ 35 Sky ................................................................................................................ 37 Wider regulatory compliance and corporate governance .................................... 37 Provisional conclusion on the broadcasting standards consideration ................. 40 Provisional findings .................................................................................................. 42 1. The reference ..................................................................................................... 42 2. The Parties ......................................................................................................... 44 21st Century Fox, Inc .......................................................................................... 44 News and current affairs at Fox ..................................................................... 45 Fox’s stated intentions in relation to Sky in the UK ........................................ 45 Fox’s proposed creation of ‘New Fox’ and merger of certain assets with Disney .......................................................................................................... 46 Sky Plc ................................................................................................................ 47 The History of Sky ......................................................................................... 47 Sky News ...................................................................................................... 48 1 Related parties .................................................................................................... 49 The Murdoch Family Trust ............................................................................. 49 News Corp ..................................................................................................... 50 Key positions held by members of the Murdoch family ....................................... 52 3. The Transaction .................................................................................................. 53 Transaction history .............................................................................................. 53 Transaction rationale .......................................................................................... 55 Transaction details .............................................................................................. 55 4. Jurisdiction and counterfactual ........................................................................... 56 Creation of a relevant merger situation ............................................................... 57 Enterprises ceasing to be distinct .................................................................. 57 Turnover threshold ........................................................................................ 59 Arrangements in progress or contemplation .................................................. 59 Concentration with a Community dimension ................................................. 59 Conclusion on European relevant merger situation ....................................... 60 Consideration of a ‘ceasing to be distinct’ between MFT and Sky ...................... 60 Counterfactual..................................................................................................... 60 5. Regulatory framework ......................................................................................... 61 Overview of broadcast regulation........................................................................ 61 Scope of broadcast regulation ............................................................................ 62 Licensing ............................................................................................................. 63 Broadcasting standards ...................................................................................... 64 The broadcasting standards objectives ......................................................... 64 Due impartiality, special impartiality and due accuracy ................................. 66 Monitoring and enforcement ............................................................................... 71 Newspaper regulation in the UK ......................................................................... 71 Media plurality consideration .................................................................................... 72 6. Framework for the media plurality consideration................................................. 72 Legal basis for our assessment of the media plurality consideration .................. 75 Interpretation of a ‘media enterprise’ and ‘newspaper enterprise’ ................. 75 Legal framework for assessment of persons with control of the relevant media enterprises ...................................................................................................
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