James Murdoch is to return as chairman of Sky four years after a phone-hacking scandal forced him out, potentially taking the Murdoch family a step closer to full ownership of the European pay-TV group. Murdoch, 43, built Sky into a powerhouse in four years as chief executive and five as chairman, and was on the verge of selling it to US media group 21st Century Fox, owned by his father Rupert, before the scandal engulfed him.
His appointment, seven months after becoming chief executive of Fox, follows Rebekah Brooks' return to lead Rupert Murdoch's newspaper business last year after being cleared of charges over the scandal at the News of the World newspaper, where reporters hacked into phones to obtain stories while she was the editor. Murdoch's return to a top job at Sky had seemed a remote possibility when he stood down from the chairmanship in 2012, but stayed on the board as a non-executive director.
Politicians lined up to denounce the family for its domination of the British media and Prime Minister David Cameron acknowledged that politicians had got too close to his father Rupert. "It's like Murdoch's getting the band back together, it's as if nothing ever happened at all," said a former executive from Murdoch's British arm.
The admission of phone hacking, including the mobile phone of a murdered schoolgirl, led to a criminal trial, a national inquiry into media standards and a political backlash that forced Fox to abandon its bid for Sky. Rupert Murdoch closed the News of the World in 2011. In the four years since he stepped down as chairman, Sky bought Fox's German and Italian businesses, rolling the European pay-TV assets into one company with 21 million customers and a London listing. It is 39 percent owned by the US group.
James Murdoch said in 2015 that for Fox, having 40 percent of an unconsolidated asset was not "an end state that is natural for us" but that they had no immediate plans to acquire the rest of the company. Buying all of Sky, which reported a better-than-expected 12 percent rise in profit and a record number of new customers on Friday, would add Europe's biggest pay-TV group to a media empire that spans US network TV, Asia's Star and one of the most famous production businesses in the world.
Recent results have shown that American TV networks are starting to struggle as viewers shift to online services such as Netflix. Sky's Chief Executive, Jeremy Darroch, said Murdoch, who was the only candidate put forward, was "without a doubt the right man for the job", underlining his deep knowledge of the international media industry and experience on the board. Darroch acknowledged there would be speculation about Fox's intentions, but said Sky's management would not be distracted. "I can't speak for Fox but what I would read into James' acceptance of the role is that he and they continue to be passionate supporters for Sky's ongoing success," he told reporters.