MUMBAI: UK media scion James Murdoch at a conference held by Ofcom attacked the UK regulatory body.
He argued that there should be more deregulation. His speech came at a time when Ofcom is looking into the legalities of Murdoch buying an 18 per cent in ITV, which is a rival of pay TV operator BSkyB that Murdoch heads. Murdoch’s move put paid to NTL’s aim of taking a stake. Entrepreneur Richard Branson owns a stake in NTL. Media reports indicate that in his speech Murdoch blamed what he terms as the ‘dead hand of history’ and specifically UK pubcaster the BBC and its founder, Lord Reith, for a fearful and backward-looking legacy that he said bred elitism and stifled creativity.
“We should never forget that when broadcasting first came to this country in the 1920s, politicians and the British establishment were more fearful than excited by the new wireless service. They were aided by Lord Reith, who took a pretty firm view of the need to keep the lower classes in their place. He welcomed the transformation of the BBC into a state agency in 1929 and thereafter had no time for any kind of innovation, whether it was jazz – a ‘filthy product of modern culture,’ according to him – or indeed television itself.”
He said that effective broadcasting regulation should be a compass by which a regulator and the players in a market can find true north in constantly shifting seas and warned the getting it wrong would open the way for tiresome and dysfunctional meddling that can shipwreck the regulatory process itself, not to mention business and their customers across the board.
Murdoch argues that those who want continuing intervention in the industry are motivated by institutional or commercial self-interest.
“That is, for example, why Channel 4 wrapped up its desire to be able to spend more of our money under the guise of public service competition to the BBC. Or indeed why the BBC favours digital terrestrial television even though it is an inferior technology in terms both of choice and functionality.”
He hit out at the BBC for having what he calls a fantasy about creating a ‘British Google’” to be funded by the taxpayer. “This is not public service, it’s megalomania. Delusions of grandeur will flourish in the absence of proper accountability,” he said. Channel 4 CEO Andy Duncan offerd a rebuttal by saying that the broadcaster is an extremely good example of a blend of market intervention and commercial competence. “The quality of television in this country and the level of originated British programming, is directly a result of intervention (by the state).”
Branson meanwhile says that Murdoch is scared of what will happen if NTL takes a stake in ITV. He says that Murdoch is terrified that a stake for NTL in ITV would mean competition for Sky. Branson adds that NTL would fight BSkyB’s prichase of the 18 per cent stake in ITV. He was quoted in reports saying, “The Murdoch empire was, I think, absolutely terrified at the idea of Virgin taking over, because we would have given Sky some real competition.
“They responded by buying 20 per cent of ITV to thwart our takeover. We have gone to the competition authorities and said that a company that already controls most of Britain’s newspaper media plus has most of the sporting and film rights in the UK shouldn’t be also allowed to have such an undue influence over ITV.”
The Office of Fair Trading is examining the case. Some politicians have even met the British government and have made an appeal that in the public’s interest Murdoch not be allowed to buy a stake in ITV.
