JAMES Murdoch’s departure from the top job at BSkyB will have little effect on the broadcaster’s business, analysts said yesterday.
Jeremy Darroch, the chief executive, and Nicholas Ferguson, who has stepped up to head the board, will provide continuity so the strategy is unlikely to change.
Murdoch will remain on the board, representing News Corporation’s 39 per cent stake, but much of the political pressure has now been alleviated, Liberum analyst Ian Whittaker said.
The City was stunned when BSkyB named Murdoch as chief executive in 2003, putting its faith in a 30-year-old with a scratchy record in the music industry and the internet. He went on to prove wrong many of the doubters, although the police and parliamentary inquiries into phone hacking which dogged his final months as chairman threaten to overshadow his achievements.
“The events at News International will be a stain on Murdoch’s career, as will the failure of News Corp’s takeover of BSkyB, which James pushed hard for,” Peel Hunt analyst Patrick Yau told City A.M.
“Given the amount of negative news flow he was generating, he had to step down. But underlying trading at Sky has been very strong over the last few years, and Murdoch was at the helm when that growth took place.”
BSkyB was transformed under Murdoch’s leadership and operating profit increased repeatedly. In 2010 it reached the milestone of 10m subscribers, which the broadcaster said meant it was used by 36 per cent of households in Britain and Ireland.
Murdoch also introduced new products such as Sky+ and Sky HD, and presided over the transition to triple-play, offering broadband, phone and television.
The broadcaster also became a credible rival to the BBC and, as Murdoch grew in confidence, he led a series of attacks on the public broadcaster. This culminated in a diatribe against its “chilling” impact at the Edinburgh International Television Festival in 2009, which triggered a furious row with BBC business editor Robert Peston in front of other dinner guests.