Ofcom monitors hacking developments

The media watchdog today said it will contact police to determine if phone-hacking allegations at the News of the World are relevant to whether News Corp would be a "fit and proper" owner of satellite broadcaster BSkyB.

Ofcom is required to ensure that anyone - including controlling directors - holding a broadcast licence remains fit and proper to do so.

The regulator said it was monitoring the unfolding situation at News International and the News of the World carefully and would be contacting relevant authorities to help it fulfil this duty.

Crucially, Ofcom said a licence holder would not necessarily have to be charged with a criminal offence for this issue to be questioned.

Elsewhere, Culture Secretary Jeremy Hunt will consider the impact of the News of the World's closure when determining whether News Corp's bid for full control of BSkyB can proceed.

A consultation on News Corp's controversial approach for the satellite broadcaster concluded today, the Department for Culture, Media and Sport (DCMS) said, but Mr Hunt is likely to take "some time" to reach a decision.

The department stopped short of giving a precise date - despite reports suggesting a September decision was likely - and added that the Secretary of State "will take as long as is needed".

A DCMS spokesman said: "He will consider all relevant factors, including whether the announcement regarding the News of the World's closure has any impact on the question of media plurality."

The Culture Secretary paved the way for the deal to go through last month when he agreed beefed-up proposals that will see Sky News run as an independent company to allay fears that the deal would give News Corp too much influence.

But the DCMS has received an unprecedented 160,000 responses to its consultation process - in the previous consultation, the department received 40,000 responses.

The surge in interest came as the phone-hacking scandal at News International and its Sunday tabloid News of the World started to unfold.

The DCMS added that Mr Hunt will take advice from Ofcom and the Office of Fair Trading before reaching his decision.

Ofcom's decision to contact relevant authorities - which include the Press Complaints Commission and parliamentary select committees, as well as the police - could delay the decision ever further.

The recent furore has caused BSkyB's share price to drop by around 8% this week, wiping more than £500 million from its market value as investors fret that the deal may not go through.

News Corp offered 700p a share last year, valuing the company at £12.8 billion, but the board told Mr Murdoch to come back with a higher offer.

Since then its share price has boomed on the back of strong results. Even after its share price losses in the past week, the current market value is still £13.6 billion.

Prime Minister David Cameron said Mr Hunt was following "the proper legal processes and procedures" during a press conference on the scandal.

He said: "His role is to take the advice of independent regulators and, as his department have made clear this morning - given the events of recent days - this will take some time."

A News Corporation statement said: "News Corporation notes today's comments by the Prime Minister with respect to its proposed offer to acquire the outstanding shares in BSkyB.

"Our priority is to continue to co-operate with the Secretary of State for Culture, Olympics, Media and Sport and the existing regulatory process."