When media baron Rupert Murdoch launched satellite television broadcast company Sky on a shoestring budget in 1989, many pundits believed it would never last. He proved them wrong, and in the process Sky swallowed its main rival, BSB. A decade later, BSkyB, after a tough marketing war, is the clear leader in the pay TV sector, with particular strengths in sports coverage, news and movies. It is a leading developer of digital television.
The lasting influence of Murdoch and his Australian launch management – until 1997 led by the robust figure of Sam Chisholm – is an entrepreneurial culture that is the envy of its competitors. Despite the regular carping from the self-styled “up-market” media, BSkyB never seems short of either talent or business opportunities.
BSkyB’s 17-strong legal department reflects its business approach and culture. Led by Deanna Bates, the lawyers have to be flexible in their function, working closely with business groups and senior management, whose offices – including that of Murdoch’s daughter, Elisabeth, managing director of Sky Networks – are on the same floor.
Their work is diverse and fast-moving, from programming deals with Hollywood studios and sports organisations,to major corporate transactions such as the bid for Manchester United Football Club. Issues relating to new technology are taken in their stride.
“Our entire business is based on the (intellectual property) rights we have with sports organisations, film studios and so on,” says Bates.
“We package these into channels and sell them to customers and cable operators. The legal department is pivotal to this process.”
Lawyers help carry the fierce commercial pressures of the business. “You have to be very committed to succeed here. You have to move fast – if someone wants a deal done, it usually has to be done by next week,” says Bates, who is personally project-managing the legal work on Manchester United.
Hailing from rural South Wales and educated at Exeter University, Bates joined Sky in 1989 at the age of 27, after nearly five years at Clifford Chance. Sky’s culture suits her and her colleagues well, she says, making a refreshing change from the “old-boy mentality” of private practice. “I didn’t go to a public school, but that counts for nothing here. It’s a true meritocracy,” she says.
Her department is split roughly 50-50 between men and women – not reflecting any positive discrimination, but rather just the “hiring of the best candidates”.
Female heads of department are still unusual in FTSE100s. Bates, who gained much of her business experience from working with Chisholm, says the experience toughened her up and taught her valuable skills.
The department has two main sections: legal and business affairs (deputy head James Conyers) and regulatory affairs, headed by Michael Rhodes.
Regulatory matters are crucial. Most immediately these focus on the Independent Television Commission licensing and rules on broadcast content, packaging and retailing; and Oftel, for licensing of BSkyB’s “conditional access services”. This is where BSkyB makes available its own encryption technology for use by independent satellite television channels such as The Racing Channel and Playboy TV, which are not sold as part of the Sky package.
The department also works closely with the firm’s public affairs unit. Despite the department split, each lawyer handles the regulatory aspects of deals on which they are working. Flexibility is essential and individuals have to turn their hand to virtually anything.
Some legal work is contracted out, especially on big-ticket matters (see main law firms). “Our firms have to respond fast and be accurate,” says Bates. “What I really look for is keenness of intellect and the ability to grab a problem by the horns.”
Head of legal
|FTSE 100 ranking||number 35|
|Market capitalisation||over £9bn|
|Legal function||17 lawyers|
|Head of legal||Deanna Bates|
|Reporting to||Mark Booth, CEO|
|Main location for lawyers||Isleworth, West London|
|Main law firms||Herbert Smith (corporate and property); Clyde & Co (employment); DJ Freeman (defamation); Olswang (advising on BSkyB’s new film production business)|