Martin Stewart, the chief financial officer at BSkyB, is to leave the pay-television group after failing to get the top job.
Mr Stewart, who is thought to be in line for a £1m pay-off, applied to replace Tony Ball as chief executive last year, along with two other senior Sky managers, Richard Freudenstein, the chief operating officer, and Jon Florsheim, the sales director. However, in November the job went to James Murdoch, the 30-year-old son of Rupert Murdoch, the company's chairman.
One industry source said: "Martin actually thought he might get the job. The other two threw their hats in the ring with the full connivance of the Murdoch camp. They knew they would never get it. Martin was the only one who thought he had a shot."
Mr Stewart, 40, has been finance director since 1998, before which he was a manager in the company's finance division. With Tony Ball, the pair formed a highly effective team, presiding over the successful strategy of switching all Sky's customers to its digital service and giving away the set-top decoder boxes that subscribers need. Under them, the company reached its target of 7 millions customers and they saw off the challenge from ITV Digital.
Mr Stewart has made several million pounds during his time at Sky. He sold £4.2m worth of shares last August, and in 2001 sold shares worth £2.3m.
Under Mr Ball, Mr Stewart was thought to have wielded considerable power. The pair were the company's only executive directors. Mr Ball was not a "details man" and left this to Mr Stewart, according to company insiders.
Although Mr Stewart was well-regarded in the City, Sky shares were little moved by the news of his departure, indicating that investors did not see it as a significant blow. Analysts said that with Sky back in profit and its superiority established over rivals, the finance director job was not so important anymore. However, Omar Sheikh, of Charles Stanley, said: "After Tony Ball's departure, it was important that Martin Stewart stuck around. It appears that we're in an interregnum period now."
Mr Stewart will remain at Sky until 4 August unless a successor is found sooner.
Separately, it emerged that a new pay-TV service available on Freeview, the digital terrestrial platform, will be announced in the next few days. The service will offer up to eight channels at less than £10 a month. Analysts said this should not threaten Sky, which targets the higher-spending end of the market.