U.K. Secretary of Culture, Media and Sport Lisa Nandy says she’s “minded to intervene” in Sky’s proposed $2.1 billion takeover of ITV’s media & entertainment unit due to “public interest considerations.”
These include the “need for free expression of opinion in news media,” the “need for a sufficient plurality of views in news media in each market” and the need for “a sufficient plurality of persons with control of the media enterprises.” It also includes “the need for the availability throughout the United Kingdom of a wide range of broadcasting, on-demand programs or both.”
“Having considered the anticipated merger, I am of the view that there are reasonable grounds to believe that it might affect availability of a wide range of high-quality and varied programming on the on-demand platforms that are now widely used by UK audiences,” Nandy said in a statement. “Consequently, if I decide to intervene on the basis of this new public interest consideration, I will bring forward legislation which amends section 58 of the Act to extend the application of the public interest consideration relating to the availability of a wide range of broadcasting to on-demand programmes.”
Nandy said she has sent a letter to Sky and ITV and is giving the companies until Oct. 20 to respond to her concerns. If she ends up issuing an intervention notice, the Competition and Markets Authority and Ofcom would review the deal and its impact on the public interest issues and competition.
She would then decide whether to refer the matter for a more detailed investigation by the CMA. Nandy noted she would update Parliament on her final decision at the “earliest opportunity.”
The Sky-ITV deal covers ITV’s linear channels and the ITVX streaming platform. Production arm ITV Studios would continue to operate separately.
Under the terms of the deal, the companies have said that Sky News and ITV News will stay editorially distinct. Sky will also acquire “The Great British Bake Off” producer Love Productions as part of the deal. It also includes $2.8 billion in content spend with ITV Studios over the next five years.
A Sky spokesperson told TheWrap that it would “carefully consider” Nandy’s letter and that it looks “forward to engaging constructively as the review progresses.”
“We remain confident that bringing Sky and ITV’s Media & Entertainment business together will create a stronger British media business, better able to compete with global streaming platforms, support great British programming and trusted news, and deliver more for audiences,” the spokesperson continued. “We have already made clear commitments to protect ITV’s identity, its free-to-air services and public service broadcasting obligations, and to ensure ITV News and Sky News remain distinct editorial voices.”
Approximately $267 million in annual cost savings are expected to be generated on a run-rate basis by the end of the third year after the deal’s closing. The majority will be delivered through efficiencies in marketing, technology platforms and non-U.K. content.
ITV, which reaches around 40 million people each week and serves over 16.5 million monthly digital users, would account for around 20% of all in-home viewing in the U.K. when combined with Sky — second to the BBC and ahead of YouTube.
Representatives for ITV did not immediately return TheWrap’s request for comment.
