Phone hacking scandal: News corp withdraws bid for BSkyB

13th July 2011

In another development David Cameron, prime minister, has announced an inquiry into all aspects of phone hacking.

The inquiry will be led by Lord Justice Leveson.

The BBC News website reported that News Corp deputy chairman Chase Carey said the bid had become "too difficult to progress in this climate".

It also reported how BSkyB's share price, which had briefly dropped following the announcement,  close 2% up after falling 4% during early trading.

In his blog the BBC's business editor Robert Peston said the move amounted to Rupert Murdoch's biggest set back.

He writes :"To be told by politicians, who till recently were seen by some as his creatures, that he shouldn't press ahead with his attempt to own all of BSkyB, and then to have to do what they urged, well it is a humiliation of a kind that is somewhat unusual for him.

On Peston's blog commentators were willing to predict that the worst is not over.

Up2snuff writes: It's not over in the UK. Sky subscription levels might be an interesting look-see at the moment. Any info, Robert? Can't wait for the reps to turn up on the door step. Didn't see them last year, perhaps getting complacent back then?

Boilerbill writes: "I think that this hurts Murdoch. He may still end up as a very powerful and successful media owner, but the recent setback will leave a bad taste in his mouth and make others less ready to deal with him. Like the bankers this powerful man has been stopped for the time being. He will lie low for a couple of years and try to rise again."

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