BT Merger Creates Murdoch Alliance

The £35bn merger between BT and MCI at the weekend will place the UK telecommunications giant in close proximity to BSkyB, raising fears among UK watchdogs.

The alliance will occur because MCI, the US telecoms operator, owns a 13.5% stake in Rupert Murdoch’s global media company News Corporation. Oftel however, the telecoms watchdog, only recently censured BT and BSkyB for a joint promotion * Oftel Bans BT/BSkyB Promotion and has today announced that it will be investigating the BT/MCI merger to check for the effects on consumers and competition.

While BT is believed to be a possible investor in BSkyB’s set-top box decoders it has been suggested that it may sell its News Corp stake to avoid the bad publicity which could be created through an Oftel investigation.

* MediaTel subscribers only

BT: 0171 356 5369

BSkyB: 0171 705 3000