US regulators have given media tycoon Rupert Murdoch’s News Corporation the go-ahead to take over America’s largest satellite TV provider, in a €6.3bn deal.
But the Federal Communications Commission imposed conditions on the takeover of DirecTV, insisting that News Corp must agree to arbitration to iron out disputes with companies that carry its broadcast and cable channels, such as cable companies and other satellite providers.
The arbitration was to allay fears that American television network Fox would pull its network programming, which includes baseball and football, from American cable systems to encourage viewers to subscribe to DirecTV. News Corp agreed not to pull either the network programming or its regional sports networks while a dispute was being arbitrated.
The Republican-dominated FCC split along party lines, 3-2, to approve the deal. News Corp owns the Fox broadcasting network and the Fox News Channel, headed by former Republican political operative Roger Ailes.
Under the deal announced in April, News Corp would acquire 34% of DirecTV parent Hughes Electronics, a subsidiary of General Motors. The deal would give News Corp the largest block of shares in Hughes and controlling interest in DirecTV, which has more than 11 million subscribers.
The deal was opposed by some consumer groups, who said that it would further reduce competition by shrinking the number of media companies and drive up the price of cable and satellite services.
“Given Rupert Murdoch’s Fox Corporation’s already bloated holdings in over-the-air TV and cable programming, the FCC should have rejected this deal,” said Jeff Chester, executive director of the Centre for Digital Democracy, a US media watchdog group.
“At the very least, they should have imposed stringent safeguards that would have ensured unfettered opportunities for new and competing programmers on DirecTV.”