Could life imitate art on the BSkyB takeover?

Hugh Grant’s presence in this debate makes for hilarious confusion – we all know what he’d do if the David he played in Love Actually was PM. He wouldn’t just block James Murdoch from taking over BSkyB, he’d throw a glass of water at him and stamp on his toe.

So here’s the dilemma for David Cameron : do you let the takeover through, strengthen the Murdoch empire and take a political battering for being their poodle or do you block it, alienate the Sun and Times newspapers and make a mockery of your own words to date on media plurality tests in the hope that the electorate (vast numbers of whom still buy Murdoch newspapers and watch Sky TV) will thank you for it?

From day one of this crisis the priority for the Murdochs has seemed to be the takeover of BSkyB. The fact they were prepared to shut down their most profitable British newspaper so quickly shows how much.

Why? Because BSkyB is a cash cow. Having done most of the infrastructure investment and won an astonishingly successful share of the digital TV market the money is set to roll in – perhaps a billion pounds a year in profit. That more than makes up for the loss of the News of the World.

The Murdoch strategy seemed clear after Rebekah Brooks reportedly told staff at the News of the World that she was staying to be the ‘conductor’ for the two years of trouble that lie ahead. As the crisis unfolds in the courts and News Corp bosses are called before various inquiries she was to be the front woman – taking the flak. Eventually she could exit leaving News International “cleansed” of the hacking scandal with both the newspaper involved and the key executives all gone. This would, they must have thought, stop corporate contagion and keep the BSkyB takeover on track. But it has not proved so simple.

Renault was the first to say it would not advertise across News International products and James Murdoch’s role as heir to his father is being questioned in the American media. So the critical factor remains BSkyB.

Although there has been much excitement about the news the British media regulator Ofcom will apply its “fit and proper” test to News Corp directors there is little reason so far to think they will fail the company. Their assumption until the end of last week was that it would require prosecutions at the top of a company for Ofcom to bar ownership of a broadcaster.

So far – despite the hopeful talk from Labour politicians and Murdoch opponents in the media of criminal liability of directors under the Regulation of Investigative Powers Act – there is no reason to think that likely. It is the uncertainty and delay that has damaged the BSkyB share price rather than real beliefs that Ofcom will fail News Corp and block the takeover.

So it comes back to the government. The Culture Secretary Jeremy Hunt’s timing was unlucky for the Murdochs – when he announced a final window for people to object nobody was expecting an avalanche of scandal. The resulting tens of thousands of objections that have been lodged left him with no choice but to delay his decision. What looked to be a final consultation to ensure nobody could question the government’s integrity as it waved through the takeover instead has thrown up massive new problems. These may not be substantive objections that should be listened to according to the law, but they show the strength of feeling against the takeover has grown as a result of the scandal at the News of the World.

It was Ed MIliband’s change of position on Wednesday that created new headaches. Until then he had insisted, like the government, that phone hacking was entirely separate to the test of media plurality. He wanted the takeover referred to the Competition Commission but there was no reason to think that would eventually block the deal. Now Labour has linked the two issues, and there are plenty of Liberal Democrats who, privately at least, agree.

David Cameron has so far stuck to his line that this is a quasi-judicial process that he is not involved in at all and does not discuss with the Culture Secretary who is in charge. He refuses to link hacking to media ownership and says he is following the law.

Sticking to that could cost him politically, while voters weigh the competing principles. We all know David from Love Actually would say “Sod it, I’m the Prime Minister. I’ll change the sodding law”. While truth can be stranger than fiction this time I doubt it.