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James Murdoch steps down at BSkyB

Last Updated 9:53 a.m. ET

(CBS/AP) LONDON - British Sky Broadcasting PLC announced James Murdoch has stepped down as chairman, but will remain a member of the broadcaster's board.

Murdoch is under pressure over his role in Britain's tabloid phone hacking scandal, and said in a letter to the board Tuesday that he was resigning, explaining "the interests of BSkyB should not be undermined by matters outside the scope of this company."

BSkyB said Murdoch will be replaced as chairman by Nicholas Ferguson, the previous deputy chairman.

Murdoch, one of his father Rupert's chief lieutenants, has been facing severe criticism as a result of the phone hacking scandal that brought down the Murdoch-owned News of the World tabloid in Britain.

Media mogul Rupert Murdoch's News Corp. (NWSA) media empire, which owns 39 percent of BSkyB, had no comment.

In February, James Murdoch quit as chairman of News International, News Corp.'s British newspaper division. At the time, James Murdoch indicated he was going to concentrate on managing parts of his father's extensive television businesses.

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He has also stepped down from the boards of auctioneer Sotheby's and prominent pharmaceutical firm GlaxoSmithKline PLC.

James Murdoch has repeatedly denied knowing about widespread phone hacking at the News of the World, though his account has been contradicted by former associates.

In a letter to British lawmakers last month, James Murdoch acknowledged that he could have done more to get to grips with wrongdoing at the newspaper, but insisted he had been misled and given "false assurances" by subordinates.

Rupert Murdoch shut down the News of the World in July amid a wave of bad publicity and plummeting advertising revenue due to the hacking revelations, and News Corp. has been struggling to shake off the damage from the hacking furor.

News Corp. abandoned an attempt to take charge of the remaining 61 percent of BSkyB in July as details of phone hacking emerged.

James Murdoch had been widely thought to be the heir to his father's media empire, and the proposed takeover of BSkyB would have boosted his profile within the company, as well as giving News Corp. full control of a lucrative broadcaster with an extensive sports and news franchise.

James Murdoch was re-elected chairman of BSkyB in November. BSkyB said Murdoch won the support of more than 81 percent of shareholders who voted, while nearly 19 percent voted against him at the company's annual meeting.

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