CMA investigation into Fox Sky bid publishes scope of inquiry

The Competition and Markets Authority (CMA) will investigate whether Rupert Murdoch would be able to control or influence editorial decisions at Sky News as part of its investigation into the £11.7bn Sky takeover bid, according to the Guardian.

The CMA has just published a document detailing the scope of the inquiry into the bid’s impact on media plurality and broadcasting standards. The power wielded by the Murdoch family if the bid to buy the 61% of Sky not currently owned by 21st Century Fox is successful will be within the issues considered.

The “genuine commitment” to broadcasting standards of Fox and Sky will be considered, along with the ability to “influence the political agenda” and ensuring that British media reflect “the range of viewpoints.”

Corporate governance and the treatment of employees both in the UK and abroad will also be under scrutiny.

The Sky takeover bid was referred to the CMA by culture secretary Karen Bradley last month. A three-month investigation by Ofcom had already found that there were concerns over media plurality but there was no reason to block the bid on grounds of broadcasting standards.

Anne Lambert, chair of the CMA panel said: “The CMA will use its extensive experience of investigating different issues in a wide range of sectors to thoroughly and impartially investigate the proposed takeover of Sky Plc by 21st Century Fox. Once the investigation is complete, we will report back to Karen Bradley for her to make a final decision.”

Future Publishing repositions T3 brand

Future Publishing is repositioning its technology brand T3 to focus on e-commerce, according to Digiday UK.

The brand’s content includes men’s lifestyle areas such as fashion, culture, travel and fitness. E-commerce is expected to be the main revenue stream for T3 in future.

Future Publishing has around 50 titles covering specialist interests such as photography, tech, music and gaming. Revenues from e-commerce have increased by 72% from last year according to the publisher’s financial review. Income from e-commerce is now £6m ($8.1m) in the first half of 2017; 15% of total revenue.

T3 has been relaunched with a simpler, image-led design with fewer display ads, more prominent buy buttons and a redesigned user journey.

Zack Sullivan, operations and marketing director at Future said: “We’re moving away from ‘here’s the five best watches’ to ‘here’s how you can get the most out of this experience’. It’s an interesting shift in consumer behaviour to want to buy more experiences.”

Virtually all pages on T3 will now have an e-commerce element. For example, an article on Swiss watchmaking could link to a related article on Swiss versus French watchmaking, which in turn would link to an article on chronograph watches then a list of the best watches with ‘buy now’ links.

T3 is building more links with niche retailers. Currently, around half a million retailers are involved with its Shopify partnership and 45,000 API feeds come from Hawk, its proprietary e-commerce platform. Future takes a cut of around 2-10% from these purchases.

Fox’s Sky bid to be referred to CMA

An additional hurdle has been placed in the path of Rupert Murdoch’s bid to become majority shareholders of Sky TV.

Culture secretary Karen Bradley has indicated she will refer the £11.7bn bid to the Competition and Markets Authority (CMA) to review media plurality and the 21st Century Fox corporation’s commitment to broadcasting standards.

The Murdoch family is attempting to purchase the 61% of Sky which it does not currently own. The takeover bid would give the US-based Fox full ownership of the European television broadcaster.

Bradley had already indicated that she was considering a referral of the bid to the CMA on the grounds of media plurality. Concerns about Fox’s commitment to broadcasting standards were raised after claims that allegations of sexual harassment were handled poorly and the network knowingly published concocted quotations in a piece on Hillary Clinton, which was subsequently retracted.

Bradley told the Commons: “I have the power to make a reference if I believe there is a risk – which is not purely fanciful – that the merger might operate against the specified public interests.”

Sky has an annual revenue of £12bn and an operating profit of £1.6bn. Fox’s offer is based on a price of around £10.75 per share. Sky share prices fell 4% on the news of the CMA review, recovering to close 1.6% down.

 

AP launches new video content exchange platform

The Associated Press has launched a live video content and service exchange platform to help provide live coverage of breaking news and events around the world.

AP Live Community helps to connect live video publishers and contributors across borders, enabling broadcasters to book service providers to cover stories simply and at low cost. The service will allow publishers to deliver live content of breaking stories and events where coverage would not otherwise be feasible.

The project has been developed in partnership with video broadcasting platform LiveU. It will work alongside the AP global news infrastructure offered by AP Global Media Services, which includes fixed studio and live positions in 30 sites around the world and live footage of international events.

The free-to-access platform uses LiveU’s technology as the basis for automatic pairing via the AP Live Community’s platform. AP will manage billing, saving both video producers and consumers from arranging individual payments.

Content producers will be able to maximise revenue by offering assets to multiple publishers, while local video crews will deliver cost savings by using regional knowledge to save time and resources.

AP Business Development Director Paul Shanley said: “As demand for live content increases, [AP Live Community] eliminates the complexity broadcasters currently face in having to source video production crews who are able to competently deliver live coverage.”

US newspapers increasingly outsource journalism to the Philippines

Newspapers across the United States of America are outsourcing the production of local news to low-paid researchers and writers in the Philippines, radio progamme This American Life has revealed.

In an interview with a young American journalist, Ryan Smith, This American Life presenter Sarah Koenig exposes the work of outsourcing company Journatic and the newspapers for whom it works, many of whom would rather remain unknown.

Former Journatic employee Smith says in the report that Journatic’s news is ‘written overseas, half-heartedly edited and slapped on a page’.

Smith, who risked being fired for speaking publicly, says he wrote and edited stories for newspapers in Texas while never leaving Chicago, about 1,000 miles away.

Using freelancers in the Philippines, Brazil, Eastern Europe and Africa, Journatic produces vast quantities of local stories, such as death notices, house sales and bowling scores based on publicly available information, for American newspapers that no longer have the resources to cover the micro detail of daily life.

Journatic and some of the newspaper companies who use it told This American Life that no writing was done in the Philippines itself. Rather, the Filipinos, who earn between 35 to 40 cents per story, ‘assemble information, in paragraph form,’ which is then written and edited in America.

However, it is hard to know how true this is. Koenig spoke to one anonymous Filipino freelancer who claimed to write stories himself. Yet their real names are never published. Instead, American newspaper publishers can click a ‘Select Alias’ button and choose Americanised names such as Jenny Cox or Glenda Smith.

While the programme paints the practice in a negative light, Journatic CEO Brian Timpone argues a good case for his model. He says he knows that he will be criticised for his business interests, but he argues that outsourcing information aggregation is the way forward for the financially-strapped media industry.

‘I personally think we’re saving journalism with our approach, ‘ says Timpone.

‘The single reporter model, the old model, just doesn’t work and hasn’t done for 30 or 40 years.’

‘We’ll be able to see more things, things that no one covers,’ Timpone says.

He goes even further, asserting that having journalists on the ground does not produce more accurate or more engaging stories than his at-a-distance model.

Timpone claims that his company can produce more content for less, helping to drive traffic for newspapers and encourage local advertising, an important stream of revenue.

‘If you have a better idea, I’m all ears,’ challenges Timpone.

Written by Will Fitzgibbon of The Bureau of Investigative Journalism.

Listen to the original This American Life programme here.

 

Boomerang Plus accepts Management Buy-Out offer

British TV producer Boomerang Plus Plc (LON:BOOM) said on Wednesday it would be taken over by its management via a cash offer of £0.77 ($1.21/€0.96) per share agreed by the firm’s independent directors.

The bid, valuing Boomerang at around £7.1m in total, has been made through Boom Pictures Ltd, a new company backed by Boomerang managers including CEO Huw Eurig Davies, finance director Mark Fenwick and executive director Gareth Rees, as well as by British TV producer Lorraine Heggessey and private equity firm LDC, part of Lloyds Banking Group Plc (LON:LLOY).

After the offer for Boomerang become fully-unconditional, Boom Pictures will be owned by LDC funds, Heggessey and Boomerang managers.

Commenting on the agreement, Boomerang’s chairman Richard Huntingford said the proposal will allow shareholders to receive a substantial cash premium, while giving the management and employees a strong platform for growth through organic projects and acquisitions in the coming years.

LDC, which plans to invest £200m in the expanding domestic TV production sector over the next two years, expects the management buyout deal to drive significant growth at Boomerang, managing director Daniel Sasaki said. He added that LDC will use its resources, skills and sector track record to support the management in its efforts to step up the development of the firm.

The new Boom Pictures aims to produce high-quality content and establish good ties with broadcasters, advertisers and talents active in multiple geographies. It wants to build itself as an attractive partner for small independent TV companies who need resources and expertise to achieve their full potential, it said.

The deal will be financed with equity and loan notes as well as cash resources of Lloyds Banking Group.

The success of the offer is subject to securing over 90% in Boomerang by 25 July. At reaching the needed acceptance level, Boom Pictures will buy the rest of Boomerang compulsorily and take the company private. The buyer said it had already secured commitments from Boomerang shareholders controlling around 80.9% in the company accounting for around 74.2% of the votes.

Boomerang is advised by finnCap.