Ofcom deepens probe into BSkyB’s broadcast licence

OFCOM has stepped up its probe into whether BSkyB remains “fit and proper” to hold a broadcast licence, it emerged yesterday.

The investigation into whether News Corp is an appropriate dominant shareholder of the satellite broadcaster has focused so far on publicly available information, such as from newspaper reports and the Leveson inquiry.

But last week Ofcom asked News Group Newspapers, the publisher of The Sun and the now-defunct News of the World, to supply it with documents relating to the civil lawsuits brought against the News Corp subsidiary in the wake of the phone-hacking revelations.

BSkyB is party to the correspondence, Ofcom said in a statement.

City A.M. understands that News Group Newspapers is prepared to cooperate with Ofcom’s request and hand over the documents.

The probe’s escalation suggests that James Murdoch, who is still considered relevant to the probe due to his senior position at News Corp despite having resigned as executive chairman of BSkyB earlier this month, has not escaped the firing line. If Murdoch is deemed not to be fit and proper, he could be required to step down from his seat as a non-executive director on the BSkyB board.

News Corp, which owns 39.1 per cent of the UK broadcaster, could also be forced to reduce its share to a non-controlling stake if the media watchdog judges it unfavourably.

Ofcom revealed last summer it was looking into News Corp’s propriety as the holder of a broadcast licence, but the probe was stepped up in January when the regulating body designated a special team to examine the issue.

The inquiry – dubbed Project Apple – considers both the company and those individuals who manage and control the broadcasting licence.

Earlier this week Ofcom launched an investigation into Sky News after the channel admitted last month that it had authorised a journalist to access without a warrant the private emails of a suspected criminal.

Sky’s head of news John Ryley conceded to Lord Justice Leveson that the act was a breach of criminal law.

While the two inquiries are distinct from one another, a negative ruling for Sky News could reflect badly on its parent body.