AFP/London
 

A demonstrator wearing a mask depicting Rupert Murdoch protests outside Murdoch’s London home yesterday
Rupert Murdoch yesterday dramatically dropped his bid for control of pay-TV giant BSkyB, bowing to pressure from the government over the phone-hacking firestorm at his newspaper empire.
Hours before the three main parties were set to back an extraordinary parliamentary vote calling for the withdrawal of the bid, Murdoch’s US-based News Corporation said it was now “too difficult to progress in this climate”.
Prime Minister David Cameron welcomed the news, saying the Australian-born tycoon should focus on cleaning up his business after the scandal which forced the closure of the News of the World tabloid on Sunday.
After decades as Britain’s political kingmaker, Murdoch has seen his empire threatened by a wave of public outrage over the hacking of voicemails belonging to people including a murdered girl and the families of dead troops.
“We believed that the proposed acquisition of BSkyB by News Corporation would benefit both companies but it has become clear that it is too difficult to progress in this climate,” said News Corporation deputy chairman Chase Carey.
Carey said News Corporation, which wanted to purchase the 61% of shares in BSkyB it did not own for £7.8bn, would remain a “committed long-term shareholder” in BSkyB.
The 80-year-old Murdoch had pushed for the bid as the broadcaster’s portfolio includes live English Premier League football and blockbuster films, and this year reached its target of 10mn household subscribers.
Only a few months ago it looked like a sure thing, but with the tide of scandal engulfing the News of the World the government put it on ice for at least six months on Monday by referring it to a competition watchdog.
Ed Miliband, the leader of the main opposition Labour party who had proposed the parliamentary motion urging Murdoch to drop the bid, said it was a “victory for the people”.
“People thought it was beyond belief that Murdoch could continue with his takeover after these revelations,” he said.
A statement from Cameron’s Downing Street office said: “We welcome the news. As the prime minister has said, the business should focus on clearing up the mess and getting its own house in order.”
The scandal has spread out from Murdoch’s newspapers to include the police, members of which allegedly received payments from the News of the World, to politicians accused of being too cosy with Murdoch.
The premier has himself felt the heat as his media chief from 2007-10 was former News of the World editor Andy Coulson, who was arrested last Thursday over allegations of voice hacking and paying off policemen.
Cameron told parliament earlier yesterday he would support the non-binding motion, and announced the details of a full public inquiry into phone hacking, which he said would also include links between politicians and the press.