James Murdoch hints BSkyB takeover is just start of expansion over decade

Murdoch says threat posed by vast tech and telecoms companies will be defining issue of News Corp’s next decade News Corporation’s James Murdoch has indicated that the takeover of BSkyB is just the beginning of a major expansion over the next decade, arguing that compared with “monolithic” technology and telecoms companies such as Google the global media business is “not big enough”. Murdoch, deputy chief operating officer of News Corporation, said that while the company may be considered to be a sprawling conglomerate in the media sector, the rise of the technology sector means there are “much, much bigger beasts” posing a threat. “The real issue becomes though, that as the competitive set changes we aren’t big enough,” he added, interviewed at the Cannes Lions International Festival of Creativity on Friday. “So when you actually look at the competitive set in the all media marketplace, when you know you have sort of monolithic brands like Google, Apple… Telefonica, Deutsche Telecom, Verizon… there are much, much bigger beasts than a News Corp or a Time Warner.” Murdoch said that it was the threat posed by tech and telecoms companies that would be the defining issue facing News Corp’s next decade. “That is a real challenge for us going forward– how do we make sure we can compete at scale globally with these new players.. [and still be] quick and creative and risk-taking,” he added. “I think it is something very much unresolved. A big factor over how this plays out over the next five to 10 years is going to be how we do that. How we make ourselves as good at a much bigger scale as we can be.” Sir Martin Sorrell, the WPP chief executive, who interviewed Murdoch in Cannes, then interjected to ask if his comments meant that “Sky is just the beginning”, referring to News Corp’s proposed plan to buy the 60.9% of BSkyB that it does not already own. Murdoch dodged answering the question directly, saying that each Sky business — the pay-TV operator is in six markets, including Germany and Italy — is a “local business”. “The national nature of those businesses doesn’t work well with competing on a global basis with monolithic brands like Google,” he said. “We co-operate with them as well but there is competitive dynamic.” Murdoch went on to illustrate this by pointing out that you can have a “deep partnership” with a company in one market – as News Corp does with ESPN in parts of Asia – while “wanting to throttle them over here”, a reference to Fox Sports versus ESPN in the US. “It is about playing the ball, not the man,” he said. Murdoch also said that News Corp shared similar issues about fears that economic conditions globally appear to be worsening, admitting that the “mood music” had changed for the worse. “In the last couple of weeks, the last four or five weeks, the mood has not been great,” he said. “Hopefully companies are in good enough shape after the shock of 2008-2009. We are in a better position. We feel healthy about the business but nervous about the macroeconomic [situation].” • To contact the MediaGuardian news desk email editor@mediaguardian.co.uk or phone 020 3353 3857. For all other inquiries please call the main Guardian switchboard on 020 3353 2000. If you are writing a comment for publication, please mark clearly “for publication”. • To get the latest media news to your desktop or mobile, follow MediaGuardian on Twitter and Facebook James Murdoch BSkyB Television industry News Corporation BSkyB Media business Cannes Lions Mark Sweney guardian.co.uk

Posted by on June 24, 2011. Filed under News, Politics, World News. You can follow any responses to this entry through the RSS 2.0. You can skip to the end and leave a response. Pinging is currently not allowed.