Murdoch plans for opinion-based TV channel scaled back

Media tycoon Rupert Murdoch as he appeared in 2012. (Photo by Eva Rinaldi/Wikimedia Commons)

Rupert Murdoch’s ambitious plans to launch an opinion-based news channel in the United Kingdom have been drastically scaled back after television executives there determined the plans were not financially feasible in the current broadcast market.

The channel, News UK, will instead launch as a streaming television channel that will reach viewers through Internet-based platforms.

Murdoch was apparently hoping to replicate his success with several other British television ventures: In the mid-1980s, he launched Sky Channel, a pan-European television network that was later folded into British Satellite Broadcasting and eventually became BSkyB. As part of the acquisition, Murdoch launched Sky News in 1989. The satellite service and the news channel were acquired by Comcast three years ago.

Since then, Murdoch has toyed with the idea of bringing a Fox News-style channel to British television, crafting plans for News UK to resemble the best of Fox News at a time when British politics became increasingly polarized and local trust in traditional media institutions started to crumble.

Murdoch, who made his name as a founder and publisher of Australian and British supermarket tabloids, brought on former tabloid executive Rebekah Brooks to oversee the development of News UK. Last December, the forthcoming channel was awarded a broadcast license by the British telecom regulator Ofcom.

Despite not having aired a single moment of programming, the channel already faces tough competition from another upstart called GB News, which aims to offer a center-right perspective on the day’s news to counter the middle-of-the-road, taxpayer-funded BBC.

Unlike News UK, which was to be distributed primarily through cable and satellite, GB News is expected to be offered through Freeview, Britain’s over-the-air digital broadcast service. Freeview is supported through an annual $180 broadcast license levied on households that view live television service, whether it’s consumed over-the-air, through cable, satellite or online.

This month, Brooks said focusing on cable and satellite distribution for News UK would be financially unfeasible for the startup network. Instead, the channel will produce high-quality content that is streamed over the Internet, with the network generating revenue from “smart advertisements” that are placed over video feeds and during commercial breaks.

Brooks’ comments and the network’s shift in strategy was first reported by The Guardian newspaper.

“While there is consumer demand for alternative news provision, the costs of running a rolling news channel are considerable, and it is our assessment that the payback for our shareholders wouldn’t be sufficient,” Brooks wrote in a memo first cited by the newspaper. “We need to launch the right products for the digital age.”

The move will see the departure of David Rhodes, an American news executive who moved to the United Kingdom in order to oversee the channel’s launch. He will be retained by News UK’s parent company, News Corporation, as an adviser on Murdoch’s bigger streaming media strategies.