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Murdoch’s Email Bombshell

As the Leveson Inquiry continues, a cache of emails spells trouble for the Conservative government in Britain. Peter Jukes reports

As Rupert Murdoch rose to take his oath at the Leveson Inquiry on Wednesday, heads were already rolling in Whitehall as a result of a trove of emails deposited by his company.

Adam Smith, the senior political advisor to the Culture Minister Jeremy Hunt, resigned after News Corp. handed the Leveson Inquiry a cache of emails from News Corp’s European head of affairs, Frederic Michel, which detail confidential information passed by Smith to the company during their contentious $16 billion bid for BSkyB.

The 163 emails seem to demonstrate an intense and cozy relationship between the office of the culture minister and one of James Murdoch’s closest aides. Many of the emails contain advance notice of parliamentary statements, internal arguments with the regulator and other officials, which were both market sensitive, and highly compromising for the culture minister, who was supposed to be overseeing the bid in an impartial "quasi-judicial" process. Labour accused the Conservative minister instead of being a "cheerleader" for News Corp. and that throwing his special adviswr under the bus in order to save his career was in breach of the ministerial code.

Rupert Murdoch

As the Leveson Inquiry explored over thirty years of Rupert Murdoch’s dominance of Fleet Street, the media mogul’s recurrent theme was that he never used political pressure to achieve any commercial ends. (Leon Neal, AFP / Getty Images)

New allegations are surfacing in London, which detail Hunt’s five days in the United States meeting News Corp. executives around the time its British newspapers began to support David Cameron. More comically—but perhaps just as damaging—a Daily Telegraph reporter, Ian Martin, relates an incident, when Jeremy Hunt apparently hid behind a tree to avoid being seen while sneaking to a dinner with James Murdoch.

All these revelations at Westminster somewhat contradicted the Wednesday testimony of Rupert Murdoch who appeared a mile or so away at the Royal Courts of Justice. As the inquiry explored more than 30 years of the media mogul’s dominance of Fleet Street, Rupert’s recurrent theme was that he never used political pressure to achieve any commercial ends.

“It’s a complete myth that I used the influence of the Sun, or supposed political power, to get influence,” he reiterated again and again, complaining about the allegations: “they just aren’t true!”

This current part of the Leveson Inquiry is looking at the connections between the press and politicians, and it’s already become one of the stormiest sessions of all. In a raucous session of prime minister’s questions, David Cameron had to answer yet more allegations of secret dinners with the Murdochs and "cosying up to News. Corp." This was followed by an equally noisy barracking of his culture minister as Jeremy Hunt made a statement, claiming that no one should jump on the "political bandwagon" and he deserves his time in court in front of Lord Justice Leveson to state his case.

LEVESON

Murdoch: Hacking Is Lazy

Murdoch: Hacking Is Lazy Reuters TV / Reuters / Landov

Says “we are not perfect.”

In a lively day of testimony before Parliament, Rupert Murdoch said Wednesday he “didn’t believe” in using hacking, calling it “a lazy way of reporters not doing their job.” “We are not perfect, I’m not saying that we are, but we are nothing compared to what you see on the Internet every day,” Murdoch said. Questions mainly focused on Murdoch’s influence over elected officials, but the News Corp. chairman insisted he never got special treatment because of his power—and he said he has never asked for any favors.

Read it at The Daily Beast

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Harold Evans Talks Back to Murdoch

On the stand in London, the News Corp. mogul took aim at the former Sunday Times editor—the latest in a 30-year feud.

It was comic and sad to see Rupert Murdoch testify at the Leveson Inquiry this morning dealing with all the charges against him. It was comic for me because he had to find a way of denying that he ever broke his promise to maintain the independence of The Times under my editorship. Political independence was only one of the promises he made and broke. It was sad that, having lost his memory, he compensated by spectacular displays of imagination. On the stand he invented a scene in which I came on my knees, begging him to tell me what to think, and not to tell anybody that I’d asked him.

Rupert Murdoch and Harold Evans

Getty Images (2)

To the detailed evidence in my book Good Times, Bad Times—never challenged or repudiated over 30 years—he could only affect memory loss, and claimed never to have read the book, which describes a year of meetings.

There is a pattern to the Murdoch sagas. He responds to serious criticism by a biting wisecrack or diversionary personal attack. What is denied most sharply invariably turns out to be irrefutably true. As with the hacking saga, so with my charges. It’s fair to say Good Times, Bad Times was well received, but several commentators suggested I had exaggerated the influence of Margaret Thatcher, and that Murdoch had honored the editorial independence he promised the editors of The Times and The Sunday Times. Charles Moore said the story should have waited until I had died; it was ungentlemanly, he thought, to write so soon of events of which I had knowledge. I am sorry I disappointed him by staying alive.

Sir Harold Evans responds to Rupert Murdoch’s statements at the Leveson Inquiry

It must disappoint all the apologists that on March 16, 2012, the Churchill Archives Centre (CAC) in Cambridge released two discomfiting documents from the Margaret Thatcher Foundation. They give the lie to the official history of The Times from 1981 to 2002. The historian engaged by The Times, Graham Stewart, wrote that Murdoch and Thatcher “had no communication whatsoever during the period in which The Times bid and referral was up for discussion.” [i] On the contrary, the documents reveal that on Jan. 4, 1981, the prime minister and Murdoch had an extraordinary secret lunch at Chequers, the prime minister’s country residence.

The record of the “salient points” of the meeting by No. 10’s press officer, (now Sir) Bernard Ingham, testifies that in accordance with Thatcher’s wishes he would not let his report go outside No. 10, which is to say ministers would not be briefed on the meeting. It must be galling for Stewart that the source he relied on for the falsehood in his history was the man who engaged him to write it. The meeting that Stewart writes never took place was highly improper. Moreover, Ingham’s “note for the record” reeks of cover-up in triplicate. It bears some parsing.

First, the pretense is that Murdoch was afforded a private meeting with the prime minister so she could be briefed on the takeover battle. That’s absurd enough, given the coverage in the press and the responsibilities of the Department of Trade. The larger absurdity is that the prime minister’s redundant “briefing” is being done by only one bidder, and by one who has an urgent interest in rubbishing his competitors. Interestingly, Murdoch’s list of rivals makes no mention of someone Stewart refers to as making a “serious offer” [ii]: Vere Harmsworth, the third Lord Rothermere, the most formidable of the newspaper owners whose great uncle Lord Northcliffe owned The Times between 1908 and 1922, a newspaper genius whose mind failed him at the end. Murdoch also chose not to inform the prime minister of the bid by the Sunday Times’s management buyout team, which submitted its offer to the Thomson Organization on Dec. 31, 1981. The monetary amount of £12 million sterling was the same. He deliberately conflates the bid by the profitable Sunday Times editors and managers with the less credible bid by journalists of the loss-making Times.

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Murdoch Takes the Stand

Confident, deliberate, and combative. Rupert Murdoch faced the Leveson Inquiry, denying that he had influenced British officials. Mike Giglio reports on the media mogul’s questioning.

For the most highly anticipated appearance to date in a public inquiry into Britain’s media crisis that has been dragging on for five months, Rupert Murdoch kept the crowd waiting just a little bit longer, appearing at the courthouse just minutes before the scheduled start as the day’s hearing opened slightly late.

With months’ worth of hype and speculation swirling around the phone-hacking scandal that has rocked Murdoch’s U.K. media empire and shuttered his prized Sunday tabloid, News of the World; with a more recent furor over the headline-grabbing arrests and police investigation into corrupt payments to police and public officials at his flagship daily, the Sun; and with renewed interest over News Corp.’s ties to politicians sparked by last night’s explosive release of emails between a company lobbyist and the U.K. culture secretary, causing the resignation this morning of his top adviser, Murdoch’s questioner, Robert Jay, started instead by focusing on the early stages of the mogul’s rise to dominance on the British newspaper scene and the roots of his alleged political influence.

Murdoch appeared in a crisp white shirt and blue tie, supported in the gallery by his third wife, Wendi Deng, who gained fame during Murdoch’s parliamentary testimony last summer by defending him from an assailant bearing a shaving-cream pie. In contrast to his son James, who appeared shifty and testy at times during his own hearing yesterday, and often responded to questions in an impenetrable management-speak, the senior Murdoch was comfortable and deliberate on the stand, even amiable at times, as when he drew laughs from the audience by joking, “Don’t take my tweets too seriously.”

But Murdoch turned more combative when Jay probed the long-discussed question of how Murdoch’s political and commercial interests influenced his newspapers. Jay produced a copy of the book Good Times, Bad Times, by Sir Harold Evans, the respected former Times editor whom Murdoch ousted following his successful takeover of London’s Times and Sunday Times newspapers in 1981. [Evans is married to Tina Brown, the editor in chief of Newsweek and The Daily Beast, and a contributor to the magazine and website.] Reading from a preface to the July 2011 edition written in response to the phone-hacking scandal, Jay referenced Evans’s contention that Murdoch’s charismatic persona dominated his entire media empire, influencing everything from its endorsements to its reporting methods.

Rupert Murdoch testifies before the Leveson Inquiry

The passage reads: “How much Rupert Murdoch knew and when he knew it may not be pinned down because he exercises what the sociologist Max Weber defined as ‘charismatic authority’, where policy derives from how the leader is perceived by others rather than by instructions or traditions.”

“Do you feel he’s got a point there?” Jay asked.

Murdoch denied this was case, calling his management style “decentralized,” saying he worked to set “an ethical example,” and adding, “I don’t have an aura.”

News Corp.

Culture Secretary’s Aide Resigns

Culture Secretary’s Aide Resigns Matthew Lloyd / Getty Images

Says he acted “without authorization” from secretary.

Adam Smith, special adviser to U.K. Culture Secretary Jeremy Hunt, has resigned over advice he gave to News Corp. executives while the company tried to take over BSkyB. Hunt was charged with overseeing News Corp.’s bid in a “quasi-judicial role.” The emails between the secretary’s office and the News Corp. lobbyist often referred to the lobbyist’s having spoken with “JH,” but the lobbyist says “JH” simply referred to contacts in the secretary’s office, usually Adam Smith. Smith says he resigned because he created the perception that News Corp. had  “too close a relationship” with the culture department.

Read it at Telegraph

LEVESON INQUIRY

Rupert Murdoch: Never Courted P.M.s

Rupert Murdoch: Never Courted P.M.s Reuters TV / Reuters / Landov

Says his tweets shouldn’t be taken seriously.

First the son, now the father. It’s Rupert Murdoch’s turn before the Leveson Inquiry on media ethics, where he’s being questioned about his use of political clout. Murdoch denied asking for or being offered favors by Prime Minister Margaret Thatcher when they had lunch in 1981, before he took over the Times newspapers, saying, “I have never asked a prime minister for anything.” Asked whether he wanted to show Thatcher he had the will to crush the unions at the paper, he said, “I didn’t have the will to crush the unions. I might have had the desire, but that took several years.” Murdoch also said that his tweets shouldn’t be taken seriously.

Read it at The Daily Beast

ON THE STAND

More Emails, More Murdoch Mystery

Britain Phone Hacking

James Murdoch in the back of a vehicle with an unidentified woman as he is driven away after appearing at the Leveson Inquiry at the High Court in London, April 24, 2012 (Matt Dunham / AP Photo)

The special adviser to Culture Secretary Jeremy Hunt resigned after a new cache of salacious emails was revealed as James Murdoch took the stand on day one of the Leveson Inquiry. Peter Jukes and Mike Giglio on the Murdoch mystery and the government official caught in the middle.

Even before Tuesday’s session at the Leveson Inquiry, there was a buzz of anticipation that something important was going to happen. Rupert Murdoch has regularly tweeted that he would fight back against his enemies since News Corp. was engulfed in a storm of allegations about criminality and anti-competitive behavior last summer. He is due to take the stand tomorrow.

But Tuesday was the day for his son, James Murdoch, to be in the spotlight of the court. Well briefed and articulate, James was a much less likely source of new revelations than his less PR-trained father. But before James begun his testimony Tuesday, rumors were rife (mainly from those close to News Corp.) that some major revelation would be made that could be deeply damaging to the Conservative-led government, who have been regularly accused by their opponents of having a too-cozy relationship with Murdoch’s News International.

James Murdoch faces the Leveson Inquiry

When the revelations arrived, they came from an unexpected quarter—and had nothing to do with phone hacking, or the email chain James was sent saying it was “rife” at the now-shuttered News of the World. Instead, a new potentially explosive email chain emerged, which touched a completely different subject: News Corp’s vast $16 billion bid for the remaining 61 percent of the nation’s dominant pay-TV broadcaster, BSkyB.

When this bid emerged soon after David Cameron became prime minister after the 2010 election, it caused consternation among commercial rivals, as News. Corp already dominated the newspaper market in the U.K.

The 163 pages of emails that were presented on Tuesday detail News Corp.’s bid for BSkyB and are written by Frederic Michel, the European director of public affairs for News Corp., and mainly describe the progress of the bid to his boss, James Murdoch, before it was dropped in the wake of the phone-hacking scandal.

Many of the emails contain replies from a special adviser to the Culture Minister Jeremy Hunt named Adam Smith, who was supposed to be overseeing the takeover process in a quasi-judicial role. Others claim to relay messages direct from the minister himself. His predecessor, the Liberal Democrat Business Minister Vince Cable, was sacked from oversight from the bid because he was caught on a covert camera by undercover reporters saying he was “at war with Rupert Murdoch” over the bid.

In the Royal Courts of Justice this afternoon, counsel for the inquiry, Robert Jay, QC, put it to James Murdoch that these emails were evidence of confidential information being shared with the company. There was an audible gasp from the usually subdued lawyers present when one of these emails to James on Jan. 24, 2011, claims, “Managed to get some infos [sic] on the plans for tomorrow (although absolutely illegal … ).” James retorted that the last line was joke.

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The Murdochs’ Grand Inquisitor

Can the Leveson Inquiry’s lead counsel crack the media moguls?

Robert Jay, QC, arrived at the courthouse early today, looking somber in his trademark yellow-framed glasses.

James Murdoch During Leveson Inquiry

News Corp.’s James Murdoch speaking at the Leveson Inquiry at the High Court in London, April 24, 2012 (Reuters TV / Reuters / Landov)

This is a big week for the lead counsel at the Leveson Inquiry, the high-profile public inquest into the British press’s dark arts. Since the inquiry began in November, Jay has questioned a steady stream of key players in the phone-hacking scandal, from former News of the World chief reporter Neville Thurlbeck to Mark Lewis, the solicitor for the family of Milly Dowler, the murdered schoolgirl whose hacked cellphone was at the center of the outcry that forced News of the World to close last summer.

But now two of the British press’s biggest fish have been forced to swim into Jay’s net—Rupert Murdoch, who takes the stand tomorrow, and his son James, the former head of Murdoch’s U.K. operations, who is getting grilled today.

Press watchdogs and Murdoch opponents alike may be hoping to witness a skewering on the stand. But a more understated approach is likely to be in store. Jay is known to give his opponents plenty of line to dissemble and thrash about—in hopes of tiring them out before he reels them in.

That approach was very much on display in today’s battle with James Murdoch, who is infamous for his ability to dodge and befuddle with impenetrable management-speak. Murdoch liberally employed this tactic in response to persistent questions from Jay—culminating in one especially jarring display of obfuscation when the counsel asked Murdoch what he knew about the phone-hacking problem at News of the World in 2008, at a moment when Murdoch had authorized a large settlement to a hacking victim.

Jay laid it out clearly for Murdoch: “Either you were told about the evidence ... and that this was in effect a cover-up, or you weren’t told, or you didn’t read your emails properly, and there is a failure of governance within the company. Do you accept that those are the only two possibilities?”

Murdoch responded: “I was told sufficient information to authorize them to go and negotiate at a higher level, and I was not told sufficient information to go and turn over a whole bunch of stones that I was told had already been turned over … I don’t think that short of knowing that they weren’t giving me the full picture, I would have been able to know that at the time.”

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James Murdoch Grilled

James Murdoch says he never saw an incriminating email regarding phone hacking at NotW until 2010.

A defiant James Murdoch took the stand at the Leveson Inquiry today for a much-anticipated grilling on his role in the phone-hacking scandal roiling his former turf. The former CEO of News International—the U.K. arm of his father’s News Corp. conglomerate—hadn’t made an appearance in London since resigning from the post in February. But he arrived more than an hour early to the courthouse, which was packed with spectators and an expectant air.

James Murdoch

James Murdoch (Dan Kitwood / Getty Images)

So far, though, viewers have seen more of the same from the younger Murdoch, who has stuck hard to the defense that he has maintained throughout the crisis—that he wasn’t aware of the extent of the phone-hacking problem until recently, and hadn’t knowingly acted to help cover it up. His careful management-speak was so persistent at times that onlookers laughed.

An increasingly exasperated Robert Jay, QC—the inquiry’s lead counsel—got right to the point: questioning Murdoch on what he knew about the phone-hacking problem at News of the World when he authorized an unprecedented settlement to a hacking victim in 2008. The suit had unearthed the infamous “for Neville” email that suggested hacking was widespread at the tabloid, not confined to a “rogue reporter,” as News International had long maintained. But Murdoch told Parliament last summer that he didn’t know the full scale of the problem at the time.

Former News Corp. executives have since contradicted that assertion, insisting that they briefed Murdoch in the lead-up to the settlement. It has also been revealed that Murdoch responded to a chain of emails—later deleted from his account by an IT worker—that contained details of the extent of the problem. Murdoch has responded by claiming he didn’t read the full email chain.

James Murdoch answers questions about discussing the BSkyB bid with Prime Minister David Cameron.

He reiterated that claim in his testimony today, and stressed that company executives had in fact worked to keep him out of the loop. “That is something I have struggled with,” he said. “Why wouldn't they tell me? They didn't.”

Jay ran Murdoch through accounts of meetings that seemed to suggest otherwise, and he proposed that Murdoch approved the high settlement because he knew that new evidence had come to light and hoped to keep it from becoming public. But Murdoch denied this was the case.

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Curtains for the Murdoch Family

With the Leveson inquiry getting underway on Tuesday in London, both Rupert and James Murdoch—plus a slew of British politicians—are set to testify. Peter Jukes on what to expect from the stand.

It’s a deceptive setting one for one of the best shows in town. The Royal Courts of Justice, appropriately situated between London’s theater land and old press hub of Fleet Street, may look opulent and spacious from outside. Paparazzi shots and TV reports regularly feature the neo-Gothic entrance as they cover celebrity divorces or high-profile libel cases. But inside, the main civil courts are a warren of Victorian corridors in need of a lick of paint. Room 73, where the Leveson inquiry into press ethics has been sitting since last November, with its low ceilings, cheap carpet tiles, and municipal coloring feels like a drab seminar room.

Over the next week, however, this unpromising scene could be the backdrop for some of the most spectacular courtroom drama—a drama that could have ramifications both for the British government and the world’s third-largest media corporation, News Corp., under the dynastic control of the Murdoch family.

On the surface the appearance of James and Rupert Murdoch before the Leveson Inquiry this week might look like a rerun of last July, when father and son were forced to give testimony to a parliamentary select committee over phone hacking at the now defunct News of the World.

However, this week is not a reprise. James and Rupert will appear separately, preventing the previous PR strategy of loyal son defending (and restraining) his octogenarian dad. Instead of being quizzed by a panel of legally untrained MPS, the Murdochs will be under oath and face the forensic cross-examination of Robert Jay Q.C., chief counsel to the inquiry, who has a habit of handing his targets a line of silky rope that they happily tie around their own necks. 

Overseeing this, and often intervening to help tighten the knot, Lord Justice Leveson is one of the country’s leading appeal court judges, and has presided over some of the most gruesome criminal cases over the last decade (including the wife of the serial killer Fred West). Even more polite than Jay, Brian Leveson gives off the avuncular air of a kindly head master. But beware. As he peers over his spectacles, Leveson is a big predatory cat that beguiles as he smiles. When he pounces—as he did on a Times lawyer who had apparently misled the High Court—careers and reputations are torn to shreds.

James is first up, with a whole day of interrogation set for this coming Tuesday. At first glance, his position on the witness stand looks the most precarious. Though the younger Murdoch son wasn’t connected to the newspaper business when phone hacking was carried out on an industrial scale at News of the World, he was the executive in charge when evidence about thousands of victims was suppressed, and he authorized massive payouts complete with confidentiality clauses.

murdoch-levyson-inquiry-jukes

Rupert Murdoch swarmed by press after a funeral in Oyster Bay, N.Y., March 12, 2012 (Mark Lennihan / AP Photo)

On the eve of the first big settlement in June 2008, James was on an email chain that indicated how phone hacking was rife at his Sunday tabloid. James claims he didn’t read the whole chain because it arrived on his BlackBerry when he was helping to look after his young kids. However, he went on to approve an extraordinary $1 million settlement, some 50 times greater than any other previous case of intrusion into privacy. 

SCANDAL

NotW Editor: Murdoch Used Me

NotW Editor: Murdoch Used Me Oli Scarff / Getty Images

Colin Myler now editor of rival paper.

In a profile in New York magazine, Colin Myler, former editor of Rupert Murdoch’s now defunct tabloid, News of the World, implies that Murdoch tarred his reputation and let him take the blame for the phone-hacking scandal to protect Murdoch’s son, James. Now editor of the New York Daily News, Myler is competing with the empire he once worked for. During the investigation, James put the blame on Myler, telling the court that he was just following advice. “The Post will have a much tougher competitor than it’s ever had in the Daily News,” an editor said of the New York papers, now that Myler has been put in charge of the Daily News.

Read it at New York magazine

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Cops Raid 'The Sun'

As a key politician publishes an explosive new book, “Dial M for Murdoch,” while the Sun's royal editor and others are arrested in Britain. Peter Jukes reports.

Another day, another twist in the scandal surrounding Britain’s most powerful newspaper publisher, News International, with the arrest of a senior journalist from the daily tabloid The Sun this morning and explosive allegations from Member of Parliament Tom Watson that News of the World systematically targeted all the members of a parliamentary committee investigating phone hacking at the shuttered Sunday tabloid three years ago.

On Thursday the Metropolitan Police announced the arrest of another three people in dawn raids under Operation Elveden, the investigation into alleged corrupt payments to public officials. According to published reports, a couple, one of whom is a member of the armed forces, were arrested in Lancashire. At the same time, a 36-year-old journalist was arrested in Kent. He was identified as Duncan Larcombe, The Sun’s royal editor. Larcombe is the seventh Sun journalist who has been arrested as part of the probe.

As he explained in his testimony last October to the Leveson Inquiry into press ethics, set up by the government in response to the phone-hacking scandal, Larcombe was the tabloid’s defense editor until January 2011 and before that a royal correspondent for five years. It is not clear which role Larcombe’s arrest relates to, but members of the armed forces also serve in the royal household.

In his written testimony, Larcombe emphasized that he checked all tips and stories with the royal family’s press officer and refused to publish harassing or intrusive pictures of the family. He also explained that bonuses were paid to Sun staff for the number of exclusives they could publish and admitted that the paper had a “very pressurized environment ... But I think this pressure is what makes us good reporters, not bad reporters.” As for payments to police, Larcombe testified under oath: “I have never paid them, nor been asked to by my employers.”

Former Times & Sunday Times editor Harold Evans and Parliament Member Tom Watson on how Rupert Murdoch scared Parliament

Scotland Yard’s investigation into alleged illegal payments to public officials has already led to 26 arrests, including of several police officers and an official at the Ministry of Defense. The six other Sun journalists arrested are defense editor Virginia Wheeler, deputy editor Geoff Webster, picture editor John Edwards, chief reporter John Kay, chief foreign correspondent Nick Parker, and news editor John Sturgis, who were arrested earlier this year. No one has yet been charged.

Meanwhile, at the launch of his book on the hacking scandal, Dial M for Murdoch, co-written with The Independent newspaper journalist Martin Hickman, Tom Watson, a key member of the parliamentary subcommittee investigating phone hacking at the News of the World, made some more explosive allegations that could further shake News Corp.

Watson alleges that former News of the World senior reporter Neville Thurlbeck told him that six journalists at the Sunday tabloid were told to target members of the committee looking into the original phone-hacking allegations in 2009 to find out any embarrassing information, such as “who was gay, who had affairs, anything we can use,” according to a passage in the book.

NEWS CORP.

Sky News Admits Hacking Email

Sky News Admits Hacking Email David Moir, Reuters / Landov

Says it was "in the public interest."

A senior executive from Rupert Murdoch’s Sky News admitted on Thursday that he had authorized a journalist to hack into email on two separate occasions, and justified the hacking by saying it was "in the public interest." Sky News head John Ryley said the journalist had been authorized to hack into the email of John Darwin, the “canoe man” accused of faking his own death, and, in a separate incident, into the email of a suspected pedophile and his wife. Murdoch’s son, James, resigned on Tuesday from his position as the chief of BSkyB, Sky News’s parent broadcaster.

Read it at Guardian

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The Murdoch Dynasty’s End

By resigning now as chair of BSkyB, James Murdoch can look like he left with honor. By Peter Jukes.

In a carefully trailed and choreographed move, James Murdoch has stepped down as chair of the British satellite broadcaster BSkyB, which he had run for six years as CEO and in which his father’s company News Corp. holds a controlling 39 percent interest.

Rupert Murdoch and son James Murdoch

Rupert Murdoch and son James Murdoch at the Cheltenham Festival horse-racing meet in Gloucestershire, England, on March 18, 2010 (Eddie Keogh, Reuters / Landov)

The move represents James’s final retreat from the U.K. in the wake of the hacking and corruption scandal that broke last summer when The Guardian revealed that one of News International’s publications, News of the World, had hacked the phone of missing teenager Milly Dowler in 2002, who it later turned out had been murdered.

Hundreds of new hacking victims rapidly came to light, including the families of other child murder victims, war widows, terrorist victims, senior politicians (including both the deputy prime minister and Tony Blair’s wife) and members of the royal family.

Having surrendered all his roles on News International’s publishing subsidiaries and nonexecutive directorships on the boards of Sotheby’s and Glaxo-SmithKline-Beecham, James claimed last month he was returning to News Corp.’s HQ in New York to concentrate on his TV interests.

But BSkyB, the most profitable pay-TV satellite channel in Europe, was his main TV interest. James’s claim to be “heir apparent” was based on his successful launch of Sky Digital and Sky Plus, and the remolding of the channel to a more diverse audience beyond sports, movies, and news, with the establishment of arts, documentary, and comedy channels. By 2011 BSkyB outstripped the BBC in terms of cash revenues, if not audience share.

James’s bid to inherit the lead control of News Corp. over his sibling rivals, Lachlan and Elisabeth, was to land complete ownership of the company. And he very nearly did.

It was never going to be easy. News Corp. already dominated Fleet Street with 40 percent of the readership: complete ownership of the pay-TV satellite monopoly would have to be approved by the broadcasting regulator, OFCOM, which has a strict “plurality” test.

HACKING

James Murdoch to Quit

James Murdoch to Quit Eddie Keogh, Reuters / Landov

Reportedly his own decision to step down.

News Corp.’s Sky News reported on Tuesday that James Murdoch will step down as BSkyB chairman due to his role in the hacking scandal. BBC reported it was James Murdoch’s own decision to step down as the investigation into his own role in the phone-hacking scandal has grown. A spokesman for BSkyB declined to comment on the report. News Corp. owns 39 percent of BSkyB, but News Corp. was forced to drop its $12 billion bid to take over the whole of BSkyB in the wake of the hacking scandal.

Read it at Reuters

Pols and Press 'Too Close'

British Prime Minister David Cameron testified before the Leveson Inquiry Thursday, saying politicians and the media have an ‘unhealthy’ relationship that lacks trust and high standards.