Sky brand dented by News Corp association

The scandal surrounding News Corp’s newspaper division has had a negative effect on the perception of the Sky brand, echoing marketers’ warnings that News International’s toxicity could spread to related Murdoch properties.

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News Corp pulled out of its bid to take full control of BSkyB yesterday (13 July), but despite the latter company insisting this would have little effect on the day to day running of its business, its public perception has been dented over the past week.

Sky’s “buzz” – the measure of positive or negative things said about the brand – was at -18.80 yesterday (13 July), down 15.16 points from the previous week, when the first News of the World accusations emerged, according to YouGov’s Brand Index, which scores brands’ public perception.

Sky’s “reputation” – the measure of people that would recommend the company as a good place to work – was down to 1.20, down 11.59 points from the week before.

BSkyB’s share price has plummeted 18% in the last week and stood at 701.5p at 12pm today (14 July).

After News Corp announced it was to withdraw its takeover bid, BSkyB released a statement saying the board believes BSkyB still has a “compelling investment case and significant growth opportunities”.

Jeremy Darroch, BSkyB’s chief executive, said: “We are delivering on our clear, consistent strategy and are building a larger, more profitable business for the long term. We remain very confident in the broadly based growth opportunity for BSkyB as we continue to add new customers, sell more products, develop our leading position in content and innovation, and expand the contribution from our other businesses.”

The furore surrounding News International heated up on 4 July when the Guardian alleged that the News of the World had hacked into the voicemail of murdered schoolgirl Milly Dowler.

Subsequent political, public and advertiser pressure forced News International executives to close the News of the World to prevent the toxicity of the brand spreading to other titles.

The scandal also led to the House of Commons urging News Corp, owner of News International, to withdraw its bid to take over the 61% of BSkyB it did not already own.

News Corp withdrew its bid and cannot make a subsequent bid for BSkyB for six months, according to takeover regulations.

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