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Ofcom 'to demand further Sky deal probe'

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Ofcom is expected to this week recommend that the £8 billion bid by News Corporation to take full control of Sky should be subject to a more in-depth investigation.

Tomorrow, Ofcom chief executive Ed Richards will submit the media regulator's final conclusions of its "public interest" review of the bid to culture secretary Jeremy Hunt.

The document will not be made public, but there is widespread belief that the watchdog will call for a six-month investigation of the deal by the Competition Commission, reports The Guardian.

That would leave Hunt - drafted in to arbitrate on the takeover after business secretary Vince Cable was stripped of the power - with about 10 working days to decide whether to accept the recommendation.

Hunt has the power to reject the suggestion of a Competition Commission probe, but the politically charged nature of the case now makes that outcome seem unlikely.

Rupert Murdoch's News Corp wants to acquire the 61% of Sky that it does not already own, but opponents argue that the move would create an overly dominant media player in the UK.

The enlarged group would control Britain's biggest newspaper group in News International and its largest pay-TV broadcaster in Sky, with a combined turnover of at least £7.5bn.

Ofcom merely needs to prove that there is even the potential for a reduction in media plurality in Britain to justify calls for a Competition Commission investigation.

Should that go ahead, the commission would provide a more probing examination of the takeover, but there is no guarantee that it would agree with Ofcom. The commission's recommendations would also not be binding on Hunt when he makes his final decision.

Before Christmas, the Labour party and the National Union of Journalists questioned whether Hunt is the right person to make the ruling on the Sky takeover.

They were specifically referring to Hunt's comments in a June interview with the Financial Times, in which he said: "It does seem to me that News Corp do control Sky already, so it isn't clear to me that in terms of media plurality there is a substantive change, but I don't want to second-guess what regulators might decide."

Also in the interview, Hunt praised Murdoch for taking a "commercial risk" in setting up the Sky business and said that the government must "encourage that kind of investment".

This week, an ICM Research poll indicated that only one in 20 people in Britain support the controversial takeover of Sky, including opposition across all political allegiances.

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