Walt Disney's deal to buy up most of 21st Century Fox's business for $52.4bn (£39bn) has cast a worrying shadow over the future of Sky News. Rupert Murdoch’s bid to buy up the 61% of the satellite broadcaster he did not already own had been referred to the Competition and Markets Authority (CMA), which is considering issues including his “suitability” and media plurality.
The Disney deal, with Murdoch’s 39% of Sky divested, means that kind of concern may no longer be a potential show-stopper, but with Sky News going into the hands of a corporation that always turns a profit, no matter what, this raises other troubling issues.
As Claire Enders, of research firm Enders Analysis told the BBC: "Sky News loses £40m a year and has absorbed $1bn of investment. It's very hard to make money out of news in a small market like the UK." BBC News business reporter Robert Plummer put the question bluntly: “Will Disney want to keep pumping money into a loss-making news channel that serves only the relatively small UK market?”
In the wake of Sky’s earlier threats to shutter Sky News, Press Gazette reported this week that 175 Sky journalists had written an open letter to the CMA saying: ““We have serious concerns about what the potential closure of Sky News would mean not only for us, but for wider society. In the first instance, scrapping the channel would result in redundancy for more than 500 people. The loss of those jobs would be deeply damaging for journalism in the UK. The closure of Sky News would damage media plurality in this country because we would only have the BBC for domestic 24-hour television news. There would, therefore, be less diversity of independent views, with one broadcaster enjoying a monopoly.”
Looking at the bigger picture regarding the Disney buyout, Paolo Pescatore, of media and market analytics firm CCS Insight, was quoted in The Independent, saying, “The move will firmly establish Disney as one of the leading media companies in the world and puts it in a great position to compete head on with the threat posed by the web providers such as Amazon and Facebook. Further disruption lies ahead and we believe that this acquisition will force others to react.” Here’s to a disruptive 2018!
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