FCC may approve DirecTV handoff to Liberty Media...somewhat
Three Republican FCC commissioners have approved News Corp.'s planned handover of DirecTV to Liberty Media, which would undo a deal that the FCC debated once already. But the two remaining Democrats have not yet signed off.
Both sides agreed to the handover in December 2006, which called for News Corp. to handover its 41% stake in DirecTV in exchange for Liberty's 16% voting share in Rupert Murdoch's media conglomerate.
In addition, Liberty is set to receive three sports networks, and an undisclosed sum of cash to sweeten the pot. The move was widely seen as a protective measure by News Corp. in order to refocus Murdoch's control over his company's principal businesses.
One condition of the deal is Liberty ceding control over either its DirecTV or cable business in Puerto Rico, where it manages both.
But until commissioners Michael Copps and Jonathan Adelstein vote on the measure -- even if they dissent -- it cannot be completed. Reuters claims that their vote is expected in the next several days, although it is speculated that their holdouts could be a by-product of Liberty Media's feud with Barry Diller's IAC.
That disagreement boiled into the courts earlier this week, with Liberty Media filing a court action to oust current CEO Diller from the board. It is also asking for several members of the board to be replaced with its own representatives.
Liberty acquired a large share of stock in IAC in mid-January, which gave it a 30% share in the company and a majority voting stake. With Liberty moving in, IAC has begun an effort to spin off businesses in order to water down the company's influence.
A flurry of lawsuits have followed between the two groups, with IAC recently stating that "Liberty does not control IAC" and saying Liberty has "gone off the deep end."
Why is this important? Simply put, Liberty has a broadband strategy, and combined with its holdings in both IAC and now DirecTV it would have the resources necessary to re-launch its efforts.
Attempts at contacting either News Corp. or Liberty Media for comment by BetaNews had not been answered as of press time, although both companies have previously declined comment to other media outlets.