Rupert Murdoch: Empire in decline. (Photo credit: Wikipedia)
The Daily Banter Headline grab (from the L.A Times):
News Corp. reported a nearly $1.6-billion loss in its fiscal fourth quarter, reflecting the declining value of its publishing businesses — a beleaguered unit that it intends to spin off into a separate publicly traded company next year.
For the April to June quarter, the Rupert Murdoch-controlled company reported a net loss of $1.55 billion, or 64 cents a share. That compared with a $683-million profit, or 26 cents a share, for the fourth quarter of fiscal 2011.
The quarterly results, reported Wednesday, included a $2.9-billion pre-tax impairment and restructuring charge that the company said was related to its Australian newspaper and TV operations and other publishing titles. During the quarter, the company took a $57-million charge related to costs of ongoing investigations into the bribery and phone hacking scandal that has engulfed the company’s British newspaper subsidiary.
The company’s publishing portfolio includes the Wall Street Journal, New York Post, Times of London and the HarperCollins book publishing house.
Excluding the charges, News Corp.’s fourth-quarter profit came in at 32 cents a share — matching analyst estimates.
News Corp. generated revenue of $8.4 billion for the quarter, a decline of 7% from the nearly $9 billion it took in during the year-earlier period. Strength at the company’s key cable television networks was weighed down by issues elsewhere in the company, including sagging ratings at Fox Broadcasting Co.‘s once dominant TV franchise “American Idol.”
Blair said on Monday that he and Murdoch had “a working relationship until after I left office”. After this they became closer and Blair was godfather to Murdoch’s daughter Grace, he added.
He told Lord Justice Leveson that Murdoch “didn’t lobby me on media stuff”, but said that was “not to say we weren’t aware of the positions their companies had”, in particular his strong views in opposition to European integration.
But he said on regulatory matters affecting Murdoch’s business directly, “we decided more often against than in favour”.
Lance Price, former Labour and No 10 press officer, had previously described Murdoch as the “24th member of the cabinet”.
Blair said: “Am I saying he’s not a powerful figure in the media? Well no, of course he is, and, of course you’re aware of what his views are, and that’s why I say part of my job was to manage the situation so that you didn’t get into a situation where you were shifting policy.
“I would say very strongly we managed the position that I believed in on Europe and that was a position the Sun and the News of the World frequently disagreed with me on.”
On his relationship with Murdoch, Blair said: “Europe was the major thing that he and I used to row about. I believed in what I was doing, I didn’t need him or anyone else to tell me what to do.”
Robert Jay QC, counsel to the inquiry, said Price had also said he had been told Blair would never change policy on Europe without talking to Murdoch first.
He replied: “No we would never have given an assurance to Mr Murdoch or anybody else that we were not going to change policy without seeking their permission. That’s absurd.
“Having said that, if we were about to engage in a major change of policy on an issue that mattered to any particular media group we would probably have tried to prepare the way for it, but I think that is perfectly sensible and there’s nothing wrong with that.”
Blair also said that his relationship with Murdoch changed after he stepped down as prime minister in 2007. “So I know there has been all this stuff about me being godfather of one of his children. I would never have become a godfather of his children on the basis of my relationship in office. After I left, I got to know him and his family and the relationship can be easier and better,” he said.
The Occupy Wall Street movement has attempted to breathe new life into its campaign against inequities in the global financial system with a series of May Day protests across around the US.
Thousands of people turned out in New York for a day of action that culminated in a confident march down Broadway in the evening sunshine towards Wall Street, the crucible of the protest that began last year with an angry backlash against banking excess.
The stated aim of bringing business in the commercial capital of the US to a standstill went unfulfilled, but as rain gave way to a bright spring afternoon, traffic ground to a halt in lower Manhatttan as the Occupy movement‘s most anticipated day of action in months took hold.
There were some clashes with police as officers clamped down on perceived violations, resulting in over 50 arrests. There were also flashpoints at protests in other cities.
In Oakland, California, scene of violent clashes between activists and police in recent months, police fired tear gas, sending hundreds of demonstrators scrambling. Four people were arrested.
Officers also fired “flash-bang” grenades to disperse protesters converging on officers as they tried to make arrests, police said. Four people were taken into custody.
Black-clad protesters in Seattle used sticks to smash downtown windows and ran through the streets disrupting traffic. The city’s mayor, Mike McGinn, made an emergency declaration allowing police to confiscate any items that could be used as weapons.
In San Francisco, the Occupy movement was blamed for a night of violence in which cars and small businesses were vandalised. Protest organisers later attempted to distance themselves from the disruption.
In New York, threatening letters containing a white powder that appeared to be corn starch were sent to some institutions in the city. Three letters were received on Tuesday: two at News Corporation headquarters and addressed to the Wall Street Journal and Fox News, and one at Citigroup. The message in the letters said: “Happy May Day”.
Rupert Murdoch: Unfit to run his business (Photo credit: Wikipedia)
Rupert Murdoch is “not a fit person” to exercise stewardship of a major international company, a committee of MPs has concluded, in a report highly critical of the mogul and his son James’s role in the News of the World phone-hacking affair.
The Commons culture, media and sport select committee also concluded that James Murdoch showed “wilful ignorance” of the extent of phone hacking during 2009 and 2010 – in a highly charged document that saw MPs split on party lines as regards the two Murdochs.
Labour MPs and the sole Liberal Democrat on the committee, Adrian Sanders, voted together in a bloc of six against the five Conservatives to insert the criticisms of Rupert Murdoch and toughen up the remarks about his son James. But the MPs were united in their criticism of other former News International employees.
The cross-party group of MPs said that Les Hinton, the former executive chairman of News International, was “complicit” in a cover-up at the newspaper group, and that Colin Myler, former editor of the News of the World, and the paper’s ex-head of legal, Tom Crone, deliberately withheld crucial information and answered questions falsely. All three were accused of misleading parliament by the culture select committee.
Rupert Murdoch, the document said, “did not take steps to become fully informed about phone hacking” and “turned a blind eye and exhibited wilful blindness to what was going on in his companies and publications”.
The committee concluded that the culture of the company’s newspapers “permeated from the top” and “speaks volumes about the lack of effective corporate governance at News Corporation and News International”.
That prompted the MPs’ report to say: “We conclude, therefore, that Rupert Murdoch is not a fit person to exercise the stewardship of major international company.”
Did Murdoch use his influence to lobby government? (Photo credit: Wikipedia)
By Cora Currier: In front of a British government panel this week, Rupert Murdoch denied that he tried to wield political influence or use his media holdings to further the business interests of News Corp.
“I take particular pride in the fact that we’ve never pushed our commercial interests in our newspapers,” Murdoch said at the media ethics inquiry brought on by the phone-hacking scandal at News of the World last year.
But email messages released Tuesday indicate that News Corp. executives at least considered dispatching top editors of The Wall Street Journal Europe and The Times of London, both News Corp. holdings, to advocate the BSkyB deal.
The newly released emails, totaling 163 pages, were exchanged among News Corp. chief lobbyist Frédéric Michel, company officials and government aides. Several refer to Lord Matthew Oakeshott, a member of Parliament whom News Corp. perceived as key to influencing Vince Cable, the government minister who had the authority in the fall of 2010 to approve the BSkyB deal.
News Corp. execs were worried that Oakeshott wouldn’t be receptive to their overtures. In one email to James Murdoch’s aide, Matthew Anderson, and Rebekah Brooks, chief executive at News International, Michel described Oakeshott as “a difficult character [who] hates lobbying (and doesn’t like our empire either…).”
So Michel, the lobbyist, suggested that they arrange a meeting between Oakeshott and James Harding, editor in chief of The Times. From the email, dated Oct. 12, 2010:
That November, Wheatcroft left The Journal after she was named to the House of Lords as a member of the Conservative party, by Prime Minister David Cameron.
It is not clear whether Harding and Wheatcroft were actually asked to lobby Oakeshott. A spokeswoman for Harding said that “there was never a meeting between James Harding and Lord Oakeshott,” but did not say whether News Corp. officials had asked Harding to have such a meeting. Wheatcroft did not respond to our requests for comment, nor did Oakeshott.
A News Corp. spokesman declined to comment on any of the emails.
Apart from raising questions about Rupert Murdoch’s claim that there was no use of his media holdings to further his company’s interests, the emails document a more general strategy to turn media coverage of the deal in favor of News Corp. in order to give political cover to the minister, Vince Cable, who could approve the deal:
Cable was removed from the bid approval process after he was recorded by journalists saying he had “declared war” on Murdoch. Cable was replaced by Jeremy Hunt, with whom News Corp. appears to have had more luck — the emails point to close communication between Hunt’s aide and News Corp. about how best to push approval of the BSkyB buyout. Hunt said Wednesday that he “didn’t know the volume of those communications or the tone” of the interactions between his aide and News Corp. The Guardian also reported Wednesday that in 2009 Hunt was at News Corp. headquartersin New York during the company’s meetings on whether to launch the bid.
News Corp. threw the support of its British newspapers behind Cameron’s Conservative party in the 2010 elections, shortly before the BSkyB bid was announced. Cameron has maintained that he had had no “inappropriate conversations” with Murdoch about the deal.
Competing news organizations and others had opposed the deal because they said it would further concentrate the media power of Murdoch, who controls 40 percent of Britain’s newspaper circulation. The bid was eventually put on hold when news of phone-hacking by Murdoch papers broke last summer and engulfed the company in scandal.
This article was originally published on ProPublica
British satellite broadcaster BSkyB, part of Rupert Murdoch’s UK media business, is facing an escalating investigation into whether it is a “fit and proper” owner of a broadcasting licence, Britain’s telecoms regulator said on Thursday.
Ofcom said it set up a dedicated team in January known as ‘Project Apple’ to investigate material emerging from the Leveson inquiry and the police’s investigations into phone hacking and the corrupting of public officials.
The investigation is considering the status of both James Murdoch, chairman of BSkyB, and News Corp, which holds a 39.1 percent stake in broadcaster, as “fit and proper” persons to own the BSkyB licence.
“Ofcom has a duty under the UK Broadcasting Acts 1990 and 1996 to be satisfied that any person holding a broadcasting licence is, and remains, fit and proper to do so,” the regulator said.
“New evidence is still emerging from hacking and corruption allegations. Ofcom is continuing to assess the evidence, including the new and emerging evidence, that may assist it in discharging its duties.” Read more at YahooNews….
Martin Lewis on Rupert Murdoch's motivation to build a reactionary Right Wing press:
Murdoch's smarts told him that he could profit mightily if only there was a permanent Conservative government in power in the UK. But how to do that when working class people selfishly insisted on voting for their own economic interests rather than those of Rupert? BINGO! It suddenly hit Rupert. Find a way to seduce working class people away from their natural instincts.
Despite his best efforts to avoid incriminating himself in Parliament, James Murdoch's testimony has been seriously challenged by two former News of the World senior executives. If Murdoch's account is proven false, the ramifications will be nothing short of devastating. From the Guardian:
Tom Watson, a member of the culture, media and sport, committee and a leading critic of the Murdochs in relation to the phone-hacking scandal, wrote to the Met in light of the public challenge by two former News of the World senior executives to Murdoch's evidence to the committee on Tuesday.
News Corporation's deputy chief operating officer told MPs that he was unaware of an email suggesting hacking at the paper was more widespread when he agreed a reported £700,000 out-of-court settlement with Gordon Taylor, the chief executive of the Professional Footballers' Association, in 2008.
The existence of the email, known as the "for Neville" email because of its links to the paper's former chief reporter Neville Thurlbeck, is thought to have been critical in News International's decision to pay Taylor the money in an out-of-court settlement after he threatened to sue the paper.
Murdoch has stood by his testimony, but it could mean that he will be investigated for perverting the cause of justice. As Andrew Sullivan writes:
The sheer size of the payment, as the NYT notes, is far, far beyond the usual damages for phone-hacking. It was kept within a very tight circle. Now that circle has broken open, who knows what else will emerge? It seems to any casual observer like an obvious piece of hush-money, which puts James Murdoch in a criminal conspiracy.
As I have stated before, the phone hacking scandal has really only just begun. The more we learn, the further up the food chain the criminality seems to get. And at some point, both Murdochs will be implicated in serious wrong doings. James is up first, and who knows how long it will be before Rupert is engulfed in the fire that is rapidly incinerating his empire.
What was exposed in Parliament during the Murdochs' testimony wasn't necessarily News Corp. — we shall see what happens to it — but instead the cozy, closed ties between institutional journalism and institutional government. The corruption of their close links was what was most shocking about today: news executives and politicians at lunch and spas and sporting events; news executives hired by politicians and police to give advice and spin their ex-colleagues; news reporters paying police; news executives sneaking through the back door to the seat of power; government officials being protected from hearing too much about the dirty work of news…
This presents an absolute PR nightmare for David Cameron, who had been doing well before the scandal broke. Cameron routinely kept Labour on the back foot, never allowing Ed Miliband to control the narrative or score effective points against him. Miliband was seen as a weak leader without the necessary artillery to take on a polished shark like Cameron.
All that has now changed – partly due to Miliband seizing the moment, but mostly because Cameron wedded himself to Rupert Murdoch and is now paying the price.
Like every successful politician in the UK over the past 30 years, Cameron realized that without Murdoch's support, his chances of beating the opposition in the general election would be dramatically reduced. Andrew Sullivan writes:
Cameron started out as the kind of Tory who would try not to become too enmeshed with the Murdoch press. But when it duly turned on him, and Gordon Brown looked as if he might win a snap election, Cameron caved to chancellor George Osborne's darker instincts and fatefully hired former NOTW hack, Andy Coulson, implicated in the phone hacking scandal, to be his press spokesman. He famously said he wanted to give Coulson a second chance. But what he effectively did was signal that he would sign up for a compromising Blair-type deal with Murdoch to win favorable coverage and thereby votes. And it worked! Murdoch's mass market tabloid, The Sun, shifted from Labour to Tory overnight. Cameron won. And since the election, Cameron has had more social and business meetings with the Murdoch tribe than with the rest of the British newspaper world combined. He has also had the worst week – deservedly – since he came to office.
Cameron is a brilliant PR man (largely as a result of his time in the industry), but he is having a very difficult time controlling public opinion as his name is dragged through the mud. His party's ties to Murdoch are threatening to unravel his government, and Cameron is now engaged in the fight for his political life.
In an ironic twist of fate, the man who helped him win the general election may now be the man to help him lose the next one.
Two key quotes from Rupert Murdoch and his son James Murdoch during the parliamentary hearing in the UK today (transcript via the Guardian):
I didn't know of it [paying police bribes]. I'm sorry… if I can just say something. And this is not as an excuse – maybe it's an explanation of my laxity. The News of the World is less than one per cent of our company. I employ 53,000 people around the world who are proud, and great and ethical and distinguished people. Professionals in their lives. And perhaps I'm spread watching and appointing people whom I trust to run those divisions.
I do not have direct knowledge of what they knew and at what time but I can tell you that the critical new facts as I saw them and as the company saw them really emerged in the production of documentary information or evidence in the civil trials at the end of 2010. The duration from 2008, or 2007 I should say till the end of 2010, the length of time it took for that come clear and that real evidence to be there is a matter of deep frustration. Mine, I have to tell you I know and I sympathise with the frustration of this committee and it's a matter of real regret that the facts could not emerge and could not be gotten to, to my understanding, faster.
The Murdochs were obviously prepped well for the hearing, giving only prepared soundbyte answers designed to obsfucate rather than inform. James Murdoch, the more polished performer, spoke for most of the time doing his best to appear humble and helpful, while Murdoch senior was more curt and reluctant to offer up information while being grilled. If anyone expected a dramatic turn of events, they will be sorely disappointed. The hearings confirmed that:
1. The Murdochs still believe they did nothing wrong personally.
2.They are not culpable for the phone hacking and bribes paid by journalists and senior executives.
3.The links between their empire, the police and the government has not been improper or corrosive.
The problem for the Murdochs is that while the scandal may appear to be peaking, it has only really just begun. James and Rupert are attempting to stem the tide, and today's performance may or may not have done that. In reality, it doesn't really matter – the investigation will continue and as more and more people will be implied, it will be harder to contain the wider implications of a highly corrupt corporate culture. Corporate culture comes from the top, and Rupert Murdoch is ultimately responsible for what goes on inside his company.
He may stay on as head of News Corporation, but his authority, power and prestige have been irreversibly tarnished. No longer will he be invited to Downing St for cups of tea with the Prime Minister, and no longer will he influence which political party gets into power. It will be shocking if the UK does not implement stringent laws to prevent the consolidation of media conglomerates, and if that happens, Murdoch will be about as relevant to UK politics as Gordon Brown now is.