Rupert Murdoch and the Corruption of the British Media

[Douglas Caddy]

A terrific program well worth viewing:

http://www.pbs.org/wgbh/pages/frontline/murdochs-scandal/

[Douglas Caddy]

Australian minister demands police investigate News Corp 'sabotage unit'

Australia's minister for communications has called for a police investigation into Rupert Murdoch's News Corp after an Australian newspaper released 14,400 emails purportedly showing the company engaged a secret unit in the mid-1990s to sabotage its competitors.

The Telegraph

By Kevin Lamarque and Jonathan Pearlman in Sydney

1:19PM BST 28 Mar 2012

The emails, part of a four-year investigation by the Australian Financial Review newspaper, suggest News engaged in corporate hacking and high-tech piracy against its Australian pay television competitors. The practice reportedly cost the company's rivals $AUS50 million a year and helped to put at least one of them out of business.

The newspaper, owned by a rival media company, Fairfax Media, reported that News Corp had set up a covert unit known as Operational Security and employed former British and Israeli police and intelligence officers to use hackers to pirate the smart cards of rival pay TV operators. The allegations follow claims by BBC's Panorama that the company engaged in similar conduct to undermine BSkyB's competition.

The stash of emails came from the hard drive of a former Metropolitan police commander in London, Ray Adams, who was head of security in Europe at NDS, a former News Corp subsidiary. They show NDS operatives engaging in a range of illegal practices including sabotaging rivals, unlawfully obtaining telephone records and fabricating legal actions.

News Limited, the Australian arm of News Corp, today dismissed the allegations.

"The story is full of factual inaccuracies, flawed references, fanciful conclusions and baseless accusations which have been disproved in overseas courts," it said in a statement.

"News Limited and Foxtel [a pay-television company part-owned by News Corp] have spent considerable resources fighting piracy in Australia. It is ironic and deeply frustrating that we should be drawn into a story concerning the facilitation of piracy." But several ministers in the Gillard Government, which believes it has been unfairly targeted by the Murdoch stable in Australia, expressed concerns about the allegations.

"These are serious allegations, and any allegations of criminal activity should be referred to the Australian Federal Police for investigation," said a spokesperson for Stephen Conroy, the minister.

Wayne Swan, the treasurer, said: "I've seen the story, I'm not sure how accurate it is. Obviously it's concerning. we'll see how it plays out."

IThe report said Operational Security was headed by Reuven Hasak, a former deputy director of the Israeli domestic secret service, Shin Bet, and was closely supervised by Mr Murdoch.

Initially the unit aimed to hunt the pirates targeting News Corp's operations but it later began encouraging piracy and the publication of hacked software on the internet.

In one email exchange, Andy Coulthurst, a British hacker working for Operational Security, emailed an NDS official: "The hack on Irdeto is SO EASY! All you need is . . ." before rattling off the details.

"Andy this is great stuff," replied Avigail Gutman, who headed Operational Security for Asia Pacific from Taiwan, where her husband was the Israeli consul

[Douglas Caddy]

Murdoch’s News Ltd. Rejects TV Piracy Claim in Australia

The New York Times

By MATT SIEGEL

March 28, 2012

SYDNEY — Rupert Murdoch’s embattled media empire found itself facing fresh controversy on Wednesday, after an Australian newspaper published an investigative report alleging that News Corporation had engaged a special unit in the mid-1990s to sabotage its competitors, leading the Australian government to call for a criminal investigation into the claims.

But News Ltd., the company’s Australian media wing, dismissed the report as “laughable,” saying that it was filled with inaccuracies and baseless claims that had been dismissed by courts in other countries, including the United States.

The newspaper, The Australian Financial Review, which is owned by one of Mr. Murdoch’s main Australian rivals, Fairfax Media, published more than 14,000 internal e-mails from a former News Corporation subsidiary along with the results of what it said was a four-year investigation into whether that company, NDS Group, encouraged the mass pirating of rival satellite television networks.

“These are serious allegations, and any allegations of criminal activity should be referred to the Australian Federal Police (AFP) for investigation,” Suzie Brady, a spokeswoman for the communications minister, Stephen Conroy, said in an e-mail exchange.

A spokeswoman for the police said that the agency had not yet received a request from the authorities to investigate the accusations in the report, which centered largely on the battle for dominance over Australia’s burgeoning pay TV market in the late 1990s but also touched on the company’s operations in Europe and the United States. The report states that Australia had no effective laws against pay TV piracy at the time, so the actions inside the country would not have been illegal at the time.

The report came a day after a BBC documentary made similar accusations against NDS Group in Britain, saying that it had paid a consultant to “crack” and publish on a pirate Web site the smart-card codes of a pay service that was started by ITV, the country’s free broadcaster. News Corporation has denied the claims made in the BBC program, “Panorama.”

The new e-mails, which the newspaper said had come from the hard drive of Ray Adams, a former commander in the Metropolitan Police in London who served as head of operational security for NDS Group in Europe from 1996 to 2002, appeared to show that a secret unit within the company called “Operational Security” promoted a wave of high-tech piracy that damaged the News Corporation rivals Austar and Optus at a time when the company was positioning itself to be the dominant player in the Australian pay TV industry.

The e-mails also supported the claims made in the BBC program, the report said.

The report said that the e-mails provided evidence that the unit, which is led by Reuven Hasak, a former deputy director of Israel’s domestic secret service, Shin Bet, encouraged and facilitated piracy by hackers of companies for whom NDS provided pay TV smart cards, which allow subscribers to receive encoded satellite transmissions.

The report said that the piracy cost the Australian companies as much as $52 million a year and helped to severely damage the television provider Austar, which Foxtel is now in the process of acquiring for nearly $2 billion in a deal that would cement the company’s hold over the country’s pay TV market. The Australian Competition and Consumer Commission is reviewing that deal.

News Corporation, which has been roiled by accusations of phone hacking at its British newspapers, including the now-defunct News of the World, hit back at the report in a statement by its Australian wing.

“The story is full of factual inaccuracies, flawed references, fanciful conclusions and baseless accusations which have been disproved in overseas courts,” News Ltd. said in a statement.

[John Dolva]

bump

[Douglas Caddy]

News Corp faces new rash of hacking allegations on a global scaleMurdoch's media empire denies fresh wave of claims that his firms undermined rivals through code cracking and piracy

By Ed Pilkington in New York

guardian.co.uk,

Wednesday 28 March 2012 11.00 EDT

Rupert Murdoch's troubles over the ongoing phone hacking scandal have become the subject of a renewed flurry of media attention this week, with broadcasters and websites across the world releasing the results of months of investigative digging.

What's striking about this week's rash of material is its truly global nature. What began as a largely internal UK affair has now spread its tentacles across national US television, prompted forensic delving into a News Corp company with roots in Israel, and inspired probing questions about some of Murdoch's Australian holdings.

Here's a guide to what's being claimed – and the News Corp responses.

PBS Frontline

Murdoch's Scandal, the PBS documentary aired in the US on Tuesday and in the UK on Wednesday, is significant not so much for what it says as where it says it. America is Murdoch's adopted home; it is where his empire is headquartered in an imposing skyscraper on Sixth Avenue in Manhattan; and it is where he planned to lay his legacy.

So when 50 minutes of prime time television are set aside to unpick the influence of the Murdoch school of media ownership in forensic and critical detail, that is felt at the very core.

The film looks back on the cosy relationship between Murdoch and a succession of British prime ministers, starting with Margaret Thatcher in 1979. Former Tory cabinet minister Norman Fowler recalls that Thatcher once berated someone critical of the media tycoon, saying "Why are you being so nasty about Rupert Murdoch, he's going to win the election for us."

You can't accuse Murdoch of limiting his political influences to one party. His relationship with Tony Blair, Thatcher's Labour successor, was equally fruitful: Murdoch's papers swung behind Blair in his bid for power, and once in Downing Street, the victor relaxed media laws which allowed Murdoch to gain a greater stake of BskyB.

John Prescott, the former Labour deputy leader, tells Frontline's Lowell Bergman: "Tony always took the view that it's better to fight an election with the media on your side, and I can understand the argument. But you pay one hell of a price on it. [Murdoch] buys influence, doesn't he?"

BBC Panorama

If Frontline gives a wide-angled narrative of the phone hacking scandal and Murdoch's political influences, the BBC's Panorama in the UK has gone for a much more tightly focused take on the alleged wrongdoings of his empire. On Monday night in the UK it broadcast a 30-minute investigation of NDS, a News Corp company that produced the smartcards used to manage the subscriptions of digital TV customers.

NDS – which was sold only last week by News Corp and its investment partner – has been the subject of repeated allegations that it engaged in computer hacking to undermine ONdigital, a provider of digital channels in Britain that stood as a rival to Sky TV, the jewel in Murdoch's British media crown. NDS has always denied any allegations of illegality and none has ever been upheld in court.

The company brought one legal challenge to an end with a deal that included an investment in the company that filed the complaint, and another, in the US, scored a pretty comprehensive victory.

Panorama propelled the story to another level entirely, by tracking down a computer hacker called Lee Gibling. The documentary, which is currently unavailable for viewing in the US, records Gibling saying that he was paid up to £60,000 a year by NDS's security department to run a TV piracy website called The House of Ill Compute, or THOIC.

Based on Gibling's testimony, as well as apparently incriminating emails obtained by the programme-makers, Panorama alleged that NDS in effect operated the THOIC website, through its UK security chief, a former police officer called Ray Adams. The programme alleged that the site was used to disseminate the codes to ONdigital's smartcards, cracked with the help of a German super-hacker called Oliver Kommerling. (Adams denies that he acted illegally.)

BBC Panorama alleged this allowed thousands of hackers to make their own pirated smartcards, giving them access to the company's TV channels without paying a penny – contributing to the collapse of the fledgling business.

Simon Dore, formerly chief technical officer for ONdigital (by then rebranded as ITV Digital), told Panorama: "The real killer, the hole beneath the waterline, was the piracy – we couldn't recover from that."

Obtaining the codes to rival smartcards is not illegal in itself. Indeed, NDS admits being involved with THOIC, but says that it used the website to get information on and combat the trade in smartcard piracy. It maintains that it did not do anything illegal.

NDS and News Corp deny they have ever condoned or facilitated smartcard hacking or the dissemination of pirated cards. In a response to the programme's allegations, published before it was broadcast, NDS said: "It is simply not true that NDS used the THOIC website to sabotage the commercial interests of ONdigital/ITV digital or indeed any rival."

Instead, NDS said that it paid Gibling as part of a plan to entrap hackers. It said: "NDS paid Lee Gibling for his expertise so information from THOIC could be used to trap and catch hackers and pirates." It said that it had obtained ONdigital's codes for a legitimate reason, "as part of the fight against pay-TV piracy".

Secretly filmed by the BBC, Adams also denied any illegality. He told Panorama that if he had known that Gibling was involved in spreading the ONdigital code around the internet, as claimed, he would have arrested him.

Murdoch's son James was a non-executive director of NDS at the time of the hacking saga, though the BBC says there is no evidence he knew of any of the alleged events.

NDS points out that, in the only battle to come to court, it won. "These allegations were the subject of a long-running court case in the United States. This concluded with NDS being totally vindicated and its accuser having to pay almost $19m in costs – a point that the BBC neglected to include."

You can read the full statement here.

In response to Panorama, News Corp said it was "proud to have worked with NDS" and to have "supported them in their aggressive fight against piracy and copyright infringement". It noted: "NDS has consistently denied any wrongdoing to Panorama and we fully accept their assurances. "

The Financial Review, Australia

From the US, to the UK, Israel and now Australia. As Panorama was broadcasting its expose, the Australian publication Financial Review was preparing to post the results of a lengthy investigation into News Corp's activities in the country of Murdoch's birth.

The paper published a document cloud containing what it claims are 14,400 leaked emails said to have been from the hard drive of Ray Adams. It has also published its top samples of the cache as a download.

The Financial Review's investigative media reporter Neil Chenoweth has been working on the story for the past four years and his article contains a mass of detail that goes well beyond even the forensic efforts of Panorama, for which he acted as a consultant. Casual readers be warned: this is serious, PHD-level stuff.

Chenoweth, who is writing a book titled Murdoch's Spies, alleges that NDS carried out similar hacking attacks on Australian digital TV rivals as Panorama claimed it made against ONdigital in the UK. The Financial Review article claims that the firm used piracy of smartcard codes to undermine pay TV competitors Austar, Optus and Foxtel in a move it's claimed that cost them up to $50m a year in lost income.

News Corporation has yet to make a detailed statement on the Financial Review's allegations but it repeated that its involvement with NDS was above board. It said: "News Corporation is proud to have worked with NDS, whose industry-leading technology transformed TV viewing for millions of people across the world, and to have supported them in their aggressive fight against piracy and copyright infringement."

[Douglas Caddy]

http://www.guardian.co.uk/news/datablog/2012/mar/28/murdoch-news-international-graphic

[Douglas Caddy]

Murdoch company in pay-TV piracy scandal 'paid Surrey Police'

By Cahal Milmo

The Independent

Thursday 29 March 2012

http://www.independent.co.uk/news/uk/crime/murdoch-company-in-paytv-piracy-scandal-paid-surrey-police-7595084.html

Related article

• Investigator was paid £1m to snoop for Fleet Street

•

•

• The News Corp subsidiary at the heart of claims it used computer hackers to crack rivals' technology made a £2,000 payment to a British police force for "assistance given to us in our work", The Independent can reveal.

NDS, a London-based specialist in satellite television encryption technology, said yesterday that a payment made to Surrey Police in the summer of 2000 was a “charitable donation” for which it had received a written acknowledgement.

But a cache of 14,000 internal emails belonging to the London-based company shows that its deputy head of security, Len Withall, asked for a cheque to be drawn for £2,000 as payment for “some work” he had been doing with the force over the previous six months.

Mr Withall, who was a former detective chief inspector with Surrey Police before joining NDS in the early 1990s, asked for the payment to be made from a special budget “set aside to Police/Informants for assistance given to us in our work”.

Surrey Police, which was rocked last year by revelations linked to the News of the World’s hacking of murdered schoolgirl Milly Dowler’s mobile phone, said it could not find a record of the payment on its accounting records but was conducting further investigations.

Payments to police by private companies are not illegal and are made frequently for events such as the policing of a football match.

But the revelation that a corner of Rupert Murdoch’s media empire was seeking to pay a British police force for unspecified work will fuel the controversy surrounding allegations that NDS supplied the encryption codes of rival companies to hackers in several countries, including Britain, who then created pirated “smart cards” for sale on the black market.

NDS, which is being sold to computing giant Cisco for a $5bn in a deal which is expected to net News Corp $1bn, has issued a comprehensive statement strongly denying that it promoted piracy or provided any codes to hackers, saying it was in contact with them only to gather intelligence on their activities and assist law enforcement bodies. It has successfully defended four claims from rivals complaining their business was damaged by its activities.

The NDS email cache, published yesterday in Australia by the Australian Financial Review, suggests that the company was also prepared to pay police in return for their assistance. The payment was first identified by the BBC’s Panorama but it was not included in this week’s programme outlining allegations about the activities of NDS in Britain after Surrey Police failed to confirm it.

In a message written at 9.27am on 9 June 2000 with the subject title “Cheque for Police”, Mr Withall outlined the reasons for the payment, mentioning that it would need to be authorised by his superior, Ray Adams, a former commander in the Metropolitan Police and its one-time head of criminal intelligence.

Mr Withall wrote: “Over the last six months, I have been doing some work with the Surrey Police. In our budget under code 880110 there is an amount set aside for payment to Police/Informants for assistance given to us in our work. With Ray’s authority, could you please make out a cheque in the sum of £2,000 payable to the Surrey Police and forward it to my office.”

The Australian Financial Review, which yesterday produced a fresh barrage of allegations about the business activities of NDS in Australia, said it had received a demand from London law firm Allen & Overy on behalf of the company asking for the email cache to be removed because it contained confidential details about NDS staff.

When The Independent yesterday approached NDS asking about the nature of a payment made to Surrey Police, the company said in a statement: “This was a one-off charitable donation of £2000 to Surrey police in August 2000. NDS’ support and donation was acknowledged with a thank you from Surrey Police.”

After being provided with details of Mr Withall’s email, the company said: “Thank you for pointing out the copy of the email from the 9th June 2000 that highlighted a request made by the appropriate channels to our finance department. The payment was a charitable donation and we have a letter of thanks from Surrey Police to confirm that.”

Mr Withall did not respond to a request last night to comment on his email.

In a statement Surrey Police said: “Surrey Police has been made aware of an apparent payment of £2,000 made by NDS to the Force in August 2000. We are currently making further enquiries regarding this matter.”

Under so-called “private hire” rules, police forces can be requested to provide officers for duties such as the policing of large public events such as sports matches or music festivals. Such arrangements are governed by strict rules of transparency and it would be unusual for a company to have to pay officers carrying out law enforcement work.

The requested payment to Surrey Police by NDS, whose global headquarters is located in Staines, a part of west London which falls under the responsibility of the Surrey force, is part of a pattern of links between the company and law enforcement bodies around the world which have proved a valuable recruiting ground for the News Corp subsidiary.

As well as recruiting former British police officers, the company has employed former members of the Israeli security services, including the former deputy head of the Shin Bet domestic security service, and an American Army intelligence officer.

In separate development, the Australian Federal Police also revealed yesterday that it was assisting Scotland Yard with its inquries following a referral “in relation to News Corp” received at the height of the News of the World phone hacking scandal last summer.

[Douglas Caddy]

Rupert Murdoch Fights Back Against 'Lies And Libels,' Declares War

Posted: 03/29/2012 7:45 am Updated: 03/29/2012 9:43 am

By Georgina Prodhan

LONDON, March 29 (Reuters) - An angry Rupert Murdoch on Thursday declared war against "enemies" who have accused his pay-TV operation of sabotaging its rivals, denouncing them as "toffs and right wingers" stuck in the last century.

Separate reports by the British Broadcasting Corporation and the Australian Financial Review newspaper this week said that News Corp's pay-TV smartcard security unit, NDS, had promoted piracy attacks on rivals, including in the United States.

NDS and News Corp had already denied the allegations, but on Thursday the media conglomerate mounted a concerted fight back as a corruption scandal that has plagued its British newspapers began to encroach on its far more lucrative pay-TV business.

"Seems every competitor and enemy piling on with lies and libels. So bad, easy to hit back hard, which preparing," News Corp Chief Executive Murdoch, 81, tweeted.

News Corp, whose global media interests stretch from movies to newspapers that can make or break political careers, has endured an onslaught of negative press since a phone-hacking scandal at its News of the World tabloid blew up last year.

At its height last July, Murdoch told British parliamentarians: "This is the humblest day of my life," after meeting the family of a murdered schoolgirl whose phone News of the World journalists had hacked.

On Thursday, it appeared that Murdoch had had enough of apologising. "Enemies many different agendas, but worst old toffs and right wingers who still want last century's status quo with their monopolies," he tweeted.

For an avowed republican such as Murdoch, describing someone as a rich and upper class "toff" is a damning insult.

The BBC has a long history of ideological clashes with BSkyB, which is 39 percent owned by News Corp, and both Rupert and his son James Murdoch have publicly attacked the British public service broadcaster over the years.

The Australian Financial Review is owned by Fairfax Media , the main rival to Murdoch's News Ltd newspaper group in Australia.

"INACCURATE CLAIMS"

James Murdoch sits on the board of NDS, which News Corp and co-owner private equity firm Permira agreed to sell for $5 billion to Cisco this month. He is also non-executive chairman and former CEO of BSkyB.

The younger Murdoch has been criticised for not uncovering the scale of phone-hacking at the News of the World, though he had not yet joined the UK newspaper operation when the hacking took place.

He has since moved to New York after being promoted within News Corp to deputy chief operating officer, and has severed all ties with the British newspapers. His focus is now the company's international pay-TV operations, where he made his career.

Chase Carey, News Corp's COO and James Murdoch's immediate boss, issued a statement late on Wednesday in which he condemned both the BBC Panorama documentary and other media worldwide who had reported its claims.

"The BBC's Panorama program was a gross misrepresentation of NDS's role as a high quality and leading provider of technology and services to the pay-TV industry, as are many of the other press accounts that have piled on - if not exaggerated - the BBC's inaccurate claims," he wrote.

NDS has complained that it was not asked for its side of the story before Monday's Panorama, which claimed NDS had leaked secret codes that allowed rampant pirating of BSkyB rival ITV Digital, which went bust in 2002.

On Thursday, NDS's Executive Chairman Abe Peled published a detailed letter to Panorama accusing the documentary of using manipulated emails to support its allegations, and demanding that the programme retract the claims.

The BBC said: "We stand by the Panorama investigation. We have received NDS's correspondence and are aware of News Corp's rejection of Panorama's revelations. However, the emails shown in the programme were not manipulated, as NDS claims, and nothing in the correspondence undermines the evidence presented in the programme."

Also this week, the Australian Financial Review published a story claiming that NDS had allowed piracy to thrive at its client U.S. satellite broadcaster DirecTV, which Murdoch had ambitions to buy, even though it had a fix.

It reported that NDS ran a secret unit in the mid-1990s to sabotage its competitors. The stories were the result of a four-year investigation by investigative reporter Neil Chenoweth, who has written two books about Murdoch.

The AFR's Editor-in-Chief Michael Stutchbury told Reuters on Thursday: "We fully stand by our reports in the paper and by Neil Chenoweth's extraordinary investigation."

"We are not motivated in any way by any desire to damage any financial rival to the company that runs the Financial Review. We are simply following the story and publishing what we have uncovered," he said.

None of the evidence presented by Panorama and the AFR this week suggests that the Murdochs or any other News Corp executives were aware at the alleged practices at NDS.

NDS has won several court cases brought by rivals accusing it of promoting piracy, while others have been dropped - in one case because News Corp bought a subsidiary from the rival, Vivendi, which at the time was struggling with debt.

News Corp made $3.8 billion in revenues and $232 million in operating profit from satellite TV in its last fiscal year. It does not detail financial results for its newspapers but its UK titles bring in less than 3 percent of group profit

[John Dolva]

Conroy urges probe into News Corp piracy claim

ABC – Thu, Mar 29, 2012 1:41 AM AEDT

The Federal Government has called for allegations of pay TV piracy against Rupert Murdoch's News Corporation to be referred to the Australian Federal Police.

The Australian Financial Review has reported that News Corp engaged in corporate hacking and piracy in a bid to damage its pay TV competitors in Australia.

News Corporation is alleged to have used a security division known as Operational Security to encourage hackers to pirate the smart cards of rival pay TV operators including Austar and Optus, thereby draining them of revenue and devaluing the businesses.

The smart cards are inserted into set-top boxes to unscramble pay TV signals.

Communications Minister Stephen Conroy described the allegations as serious and called for them to be referred to the AFP.

"These are serious allegations, and any allegations of criminal activity should be referred to the AFP for investigation," a spokeswoman for Senator Conroy said.

News Corp has denied promoting piracy or sabotaging the commercial interests of its rivals.

An Australian Communications and Media Authority (ACMA) spokesman said "at this stage" the media watchdog was not investigating the allegations.

He said the pay TV industry had its own code of practice established under a co-regulatory regime.

ACMA monitors content but not issues such as piracy, the spokesman said.

The Australian Subscription Television and Radio Association, which develops the relevant codes of practice with ACMA, declined to comment when contacted.

Takeover bid The allegations come as the competition watchdog is finalising its approval of a takeover bid for Austar by Foxtel, of which News Corp owns 25 per cent.

The Australian Competition and Consumer Commission is concerned the takeover would threaten competition in the industry.

On Tuesday, the BBC aired allegations that a News Corporation subsidiary, NDS, recruited a hacker to acquire the smart card codes of ITV's ONdigital, the biggest pay TV rival to News Corp's Sky TV network in the United Kingdom.

In a statement issued after the BBC aired its allegations, NDS denied it sabotaged the commercial interests of any rival and says it recruited hackers to track and catch other hackers and pirates.

A Foxtel spokesman confirmed the company had used external service suppliers, including NDS.

But he stressed there were no allegations of wrongdoing by Foxtel.

"Foxtel has always worked hard and spent significant amounts of money to combat piracy," the spokesman said in a statement.

"This has included running an extensive court case against pirates and working with the AFP, other subscription TV providers, including Austar, and advocating with government to enact effective laws to protect Australia's creative industries and legitimate consumers."Â ABC/wires

@y7finance on Twitter

[John Dolva]

crikey !!

http://www.crikey.com.au/2012/03/30/just-another-crazy-rupert-murdochs-week-of-horrors/?utm_source=feedburner&utm_medium=feed&utm_campaign=Feed%3A+CrikeyDaily+%28Crikey+Daily%29&utm_content=Yahoo+Search+Results

Friday, 30 March 2012 / 18 comments

‘Just another crazy’: Rupert Murdoch’s week of horrors

by David Salter, a journalist and former Media Watch EP

It’s been a bad week to be a Murdoch. Even ever-smiling Sarah, who married into the clan via Lachlan, seemed so paralysed by the revelations over the past five days that she confessed to Nine News that she couldn’t make up her mind which infant to vote for as a judge of the Australia’s Loveliest Baby competition. That it has come to this …

News Corporation suffered three hefty hammer blows in the space of as many days. First, the BBC current affairs flagship Panorama revealed the bones of what looks to have been a secret worldwide strategy to sabotage their competitors in the pay-TV market. The following day, The Australian Financial Review put some meat on those bones with exhaustive detail. On Wednesday, The Independent (UK) published a strong news feature that tracked how similar hacking/piracy techniques had been employed in Italy, where News International also has a major interest in pay TV. The Independent described its revelations as another chapter in the “uncomfortable scrutiny of the Murdoch empire”.

There’s a delicious irony here. Just weeks ago Murdoch was protesting to the world how his competitors were all helping themselves to content on the internet sites of his major titles. It was outright and unconscionable “theft”, declared Rupert. Now it looks very much as if businesses either owned by, or associated with, News have been encouraging code hackers to steal access to the pay-TV services of their competitors, thereby robbing them of income and making them vulnerable to takeover — often by News.

Like the wounded bull elephant he now resembles, Murdoch spat back venom on Twitter: “Enemies many different agendas, but worst old toffs and right wingers who still want last century’s status quo with their monopolies.” Murdoch complaining about right-wingers and monopoly power is a tad piquant to say the least, but there was more: “Seems every competitor and enemy piling on with lies and libels.” Anyone who’s been done over by a Murdoch tabloid, or been the target of The Australian’s long, vengeful attack campaigns will find the hypocrisy of Rupert’s bleat breathtaking.

After a day or two struck dumb by shock (or maybe waiting for their riding instructions), News outlets in Australia have circled the wagons. Page two of today’s Australian is a classic of confected outrage. The common theme is that NDS, the News-owned company accused of running the hacking/piracy operations, had done nothing “illegal”. That may well be so, but it’s hardly the point. Nixon kept declaring “I am not a crook”, but he still had to go.

What’s important here is that the stench of underhand, possibly illegal News Corporation business practices is no longer just confined to the News of the World phone-hacking outrages. Indeed, the stink now emanating from Murdoch’s TV and associated electronic media ventures may soon overpower the original bad smells from Wapping and New Scotland Yard.

Curiously, these new revelations have so far attracted a tiny fraction of the coverage of the NotW scandal. Why? Because newspaper reporters and editors still tend to think of media power in terms of traditional print. Any story about Murdoch’s tabloid shenanigans gets huge coverage in the broadsheets because it reinforces old assumptions about the Dirty Digger and his dreadful deeds. The lazy, under-resourced electronic media then follow print’s lead and amplify the story beyond sensible proportions.

Yet what’s really happened following the News of The World scandal? A few showy parliamentary inquiries, a few non-custodial arrests without charge, a few sackings and resignations. One of Rupert’s London red-tops closes to be replaced a few months later by another. In hindsight, all the hyperventilating coverage of Murdoch’s UK phone-hacking embarrassments has been disproportionate.

What we’re getting now, with the Panorama/Fin Review/Independent investigations, is far more significant for the long-term health of News and the Murdoch family. It hits them hard where they now make most of their money. What truly matters to them are the new rivers of media gold — pay-TV subscriptions in high-population markets.

At last count, print represents about 20% of News revenues, and probably even less of its net profits. Sure, Rupert loves to wield power and influence through his newspapers — they’re what get him in the back door of No.10 and front gate of Kirribilli House — but the profits from one mega hit Fox movie swamp anything his newspapers can deliver. Another indicator of this relative scale is the pending sale of NSD, essentially a software company, to Cisco for $5 billion. You could probably buy most, if not all, of Rupert’s print mastheads around the world for less than that.

The real story here (and the one that’s likely to do significant long-term damage to News) is that we now have evidence of an apparently widespread culture of Watergate-style “dirty tricks”. This is a corporation that apparently finds it difficult to see any distinction between robust competitive business behaviour and sabotage.

Rupert’s fight for survival won’t be waged in the UK or Italy but in the US, where the business establishment has always seen him as an uncouth interloper. They’re patient men, quite happy to let the British and Australian media make the running until their quarry is weakened. Eventually, one of the myriad American agencies with a stake in local media regulation will pluck up the courage to assemble all the evidence and put Murdoch to the “fit and proper person” test. Which is where the real fun will start.

Meanwhile, the sudden departure of John Hartigan as boss of News Limited in Australia might now make more sense. Either he knew there was some very unpleasant stuff barrelling down the chute towards him, or the international Murdoch heavies realised they needed a fresh cleanskin in the CEO chair so he could run the “it-all-happened-before-my-time” defence.If the fallout does reach Australia, Hartigan’s successor Kim Williams may not be so lucky. Initially he could deflect any fresh allegations with an “I know nothing” shrug, but his recent long tenure as boss of Foxtel may now not seem such an impressive line on his CV.

There’s another interesting Australian connection. When Rebekah Brooks had to be dumped last year as News International CEO in London at the height of the phone hacking dramas, Murdoch drafted in his veteran Australian fixer Tom Mockridge as the new boy with no bad backstory. But that strategy may now unravel as it emerges from The Independent investigation that Mockridge was at the helm of Sky Italia when it may have been involved in yet more shady dealings with encryption-card hackers.

Through it all, Murdoch and his lieutenants around the world have persisted with the inverted morality that’s become almost style-of-house for the News empire and its outlets. They run the largest commercial media conglomerate in the world, yet portray themselves as victims. They complain of being unfairly attacked by their enemies (those damned “elites” again) while never hesitating to use their power to push agendas and pursue vendettas. “Easy to hit back hard, which is preparing” Murdoch posted yesterday.

Indeed, Murdoch increasingly looks like the King Lear of Bel Air, tweeting against the tempest while his wives and children furtively position themselves to snaffle up whatever may be left of his crumbling empire. Last night he was still at it on Twitter, damning the AFR expose as “Proof you can’t trust anything in Australian Fairfax papers, unless you are just another crazy”.

Still crazy after all these years? This will get ugly before it’s over.

[Douglas Caddy]

James Murdoch 'on brink' over BSkyB chairmanship

James Murdoch is on the brink of making what has been described as a “fine line” decision on his future as chairman of BSkyB.

Pressure is increasing on James Murdoch and could lead the BSkyB board to reconsider its support for him.

The Telegraph

By Kamal Ahmed

9:30PM BST 31 Mar 2012

The former chief executive of News International is considering whether it would be better to resign now before a report by the Culture, Media and Sport select committee into the phone-hacking scandal at News International due at the end of the month.

Although Mr Murdoch denies any wrong-doing, the committee is considering censuring him for failures to investigate fully allegations that accessing celebrities and others voicemail messages was widespread in the newspaper group. The issue over whether he will stand down is said to be “finely balanced”.

It is also understood that Mr Murdoch and his father, Rupert, the chairman and chief operating officer of News Corporation, will give evidence to the Leveson Inquiry into media ethics later this month.

Both events could increase pressure on James Murdoch and could lead the board to reconsider its support for him. At present the board is still said to back Mr Murdoch but is aware that he may decide it is best to move on.

If the Parliamentary committee finds against him, Ofcom, the media regulator is set to extend its inquiry into Mr Murdoch. It is considering whether he remains a “fit and proper person” to oversee a media organisation that holds a licence from the regulator.

Ed Richard, the chief executive of Ofcom, now has a team of people looking at the issue although no decision has been made on any action it may take.

Investors who are still backing Mr Murdoch fear that if he resigns after a critical committee report or a difficult appearance before the Leveson Inquiry his record at BSkyB could be tainted. If he goes more quickly, investors believe Mr Murdoch will have a chance to lay out his record at BSkyB which many in the City believe has performed well under his stewardship.

One person with knowledge of the issue said that the decision was on a “fine line”. If he does resign, his position is likely to be filled by Nick Ferguson, the present senior independent director, as a stop-gap measure until a new replacement can be found.

Mr Murdoch was formerly chief executive at BSkyB and oversaw a number of innovations including high-definition television and Sky+ and has seen the subscriber base increase by many millions of people.

Over the last five years BSkyB’s share price has risen from 560p to close at 676p last Friday. If he does decide to resign investors believe he wants to be able to say his record was a good one.

Mr Murdoch has faced harsh criticism for his role at News International after admitting that he did not read an email from senior executives saying that phone hacking at the organisation could be widespread. Alleged criminal activity at the organisation also appeared to be rife whilst he was CEO.

Mr Murdoch has written to the committee saying that he did not mislead MPs. The report is due to be finalised after Parliament’s Easter recess.

Last week News Corporation, of which Mr Murdoch is deputy chief operating officer, faced a series of allegations about its relationship with a set-top box security company called NDS. NDS has supplied BSkyB.

NDS has faced accusations that it used its security knowledge of the pay-tv market to undermine rivals. It denies the claims.

[Douglas Caddy]

Leveson inquiry: Former NotW executive advised two top police officers on job applications

Former News of the World deputy editor Neil Wallis advised two Metropolitan Police Commissioners when they were applying for the top job, he said today.

The Telegraph

By Martin Evans

3:15PM BST 02 Apr 2012

Mr Wallis told the Leveson Inquiry into press standards that he had spoken to both John Stevens - later Lord Stevens - and Sir Paul Stephenson, when they were in the running to head up the country’s biggest force.

He explained that he advised them on how best to approach the application and interview process from his experience as a senior tabloid executive who understood the worlds of media, politics and the police.

Mr Wallis said he was introduced to Lord Stevens by Scotland Yard’s former head of public affairs, Dick Fedorcio, around 12 months before he was appointed Met Commissioner in January 2000

He told the inquiry: “I had quite strong views about what was happening at the Met. I cared about the Met a lot. Whoever succeeded Paul Condon was going to be a very important appointment for the Met.

“I thought he was the best candidate of the other candidates I was aware of.”

In a witness statement provided to the inquiry, he said: “Through my contact with him I became aware of his intention to apply for the position of Metropolitan Police Chief. This was a competitive process thus, there were a number of applicants from senior positions countrywide; these included, as he was at that time, lan Blair - the future Metropolitan Police Commissioner.

“I advised Lord John Stevens throughout the application and interview process in which he was ultimately successful.

“I recall having a number of discussions with him on the subject of his candidature. My input in this process was that he would be well advised to emphasise that he was a "coppers copper" or "thief taker" - in other words he was a man of action, rather that rhetoric.”

Lord Stevens retired as Met Commissioner in 2005 and was later employed by the News of the World to produce a column entitled, The Chief, which was ghost written by Mr Wallis.

Mr Wallis told the inquiry he had offered similar advice to Sir Paul Stephenson when he was applying to be Metropolitan Police Commissioner in 2009.

Sir Paul stood down last July following an outcry over his close relationship with Mr Wallis and the Met’s decision to award him a £24,000 a year contract to provide PR to the force.

Asked if he ever offered advice regarding his application for Met Commissioner, Me Wallis said: ” If we were together and the subject came up I would give him my view. I would have made it plain to him that I though John Stevens relationship and attitude towards the media were more successful than Ian Blair had been.”

It is the second time Mr Wallis has given evidence to the Leveson Inquiry, first appearing in December.

He has also been arrested by detectives investigating allegations of phone hacking at the News of the World.

As well as Sir Paul Stephenson decision to step down, assistant commissioner John Yates and Mr Fedorcio also left their positions in the Met following criticism over their relationship with Mr Wallis.

Mr Wallis was appointed deputy editor of the News of the World in 2003 and became the paper’s executive editor in 2008 before leaving in 2009.

He was arrested last July by officers from Operation Weeting and was bailed to a future date.

[Douglas Caddy]

James Murdoch quits as BSkyB chairman

James Murdoch has finally relented to shareholder pressure and quit as chairman of BSkyB, the satellite broadcaster.

Pressure is increasing on James Murdoch and could lead the BSkyB board to reconsider its support for him.

The Telegraph

By Kamal Ahmed and Katherine Rushton

3:01PM BST 03 Apr 2012

In a letter to the board, he said he feared becoming a lightening rod for the pay-TV broadcaster, and that BSkyB risked being undermined by matters outside the scope of the company, referrin the phone hacking scandal at News Corporation.

I believe that my resignation will help to ensure that there is no false conflation with events at a separate organisation, he said.

Mr Murdoch will be replaced by BSkyBs deputy chairman, Nicholas Ferguson, but will retain a seat on the board as a non-executive director.

In a statement, Mr Ferguson praised Mr Murdochs vision, drive and strategic insight and reiterated that the boards support for James and belief in his integrity remain strong.

Mr Murdoch took the decision after speaking to close colleagues at BSkyB and News Corporation last week and over the weekend.

He has decided to quit now ahead of what is likely to be a critical report by the Culture, Media and Sport Select Committee at the end of the month into allegations of phone hacking.

The media select committee report is likely to raise fresh questions about Mr Murdochs role as chief executive of News International during the phone hacking scandal.

He admitted he did not read an email from senior executives about the widespread nature of the allegations.

It is believed that Mr Murdoch thought it is better to go now than being seen to be forced out by a critical report. He is also due to appear before the Leveson Inquiry into media ethics with his father, Rupert, at the end of the month.

Any criticism is likely to increase the scope of an inquiry by Ofcom into whether Mr Murdoch is a fit and proper person to hold a licence for a television company.

His resignation comes after growing pressure from shareholders. They are concerned that the phone hacking allegations at News International, where Mr Murdoch was formerly chief executive, are having a contagion effect on BSkyB.

Mr Murdoch also faced conflict of interest issues after News Corporation, of which he is deputy chief operating officer, launched a bid to buy the proportion of BSkyB it does not already own.

Rupert Murdoch, chairman and chief executive on News Corp, and Chase Carey, NewCorp's chief operating officer, said in a statement: We are grateful for James Murdochs successful leadership of BSkyB. He has played a major role in propelling the company into the market-leading position it enjoys today and in the process has been instrumental in creating substantial value for News Corporation shareholders.

"We look forward to BSkyBs continued growth under the leadership of Nicholas Ferguson and Jeremy Darroch and to James continued substantial contributions at News Corporation.

Edited April 3, 2012 by Douglas Caddy

[Douglas Caddy]

http://www.dailymail.co.uk/news/article-2124378/James-Murdoch-resigns-chairman-BSkyB-wake-phone-hacking-scandal.html

[Douglas Caddy]

Leveson inquiry: John Yates attented wedding of News of The World crime editor

John Yates, the former Metropolitan Police assistant commissioner, who resigned over criticism of his links with News International, attended the wedding of the News of the World’s ex-crime editor, the Leveson Inquiry heard yesterday.

John Yates was so close with News of The World's Lucy Panton he even attended her wedding, the Leveson Inquiry heard

The Telegraph

By Martin Evans

2:23PM BST 03 Apr 2012

Lucy Paton said Mr Yates, who headed up Scotland Yard’s counter-terrorism unit, was a “working friend” and one of a number of police officers at the wedding.

The inquiry into press standards had previously heard how Miss Panton enjoyed a close working relationship with Mr Yates with the pair meeting regularly.

At one stage she was told by her boss at the now defunct Sunday tabloid to “call in all those bottles of champagne” in order to get an “exclusive” story on an alleged terror plot.

But Miss Panton told the inquiry that her relationship with the senior officer was entirely professional and dismissed the suggestion she had bought him champagne as “banter” from her office.

Miss Panton, who married a Scotland Yard detective also denied the suggestion that Mr Yates’s attendance at her wedding was inappropriate.

She said: “There were a few people at my wedding who I would class as working friends, who I didn't socialise with outside of work.

"Mr Yates falls into that category. I certainly got on well with him. I had a good rapport with him.

"But we didn't socialise outside of work. The wedding was the only occasion."

Ms Panton added that Mr Yates attended the wedding of fellow crime reporter Jeff Edwards, who worked for the Daily Mirror from 1992 until he retired in 2008.

She said the only time she had consumed champagne with Mr Yates had been in the company with other people such as at the Crime Reporters Association Christmas party and said her boss’s remark had been “banter with a little pressure”.

She explained: "There were no bottles of champagne. I think he was putting pressure on me to get a story. I would call that banter. It's a way that people spoke to each other in our office."

She added: "I think they hoped that we would be able to ring these people up and bring in exclusives every week.

"The reality is they know that doesn't happen, unfortunately, otherwise we would have had bigger and better crime stories than we did.

"My recollection of this is that I did phone Mr Yates, and I don't believe I actually got to speak to him. That was the reality, week in, week out."

Asked about a dinner with assistant commissioner Andy Hayman in 2007 at which the officer bought a bottle of champagne, Miss Panton said she did not believe she had been present as she was still off on maternity leave.

The inquiry previously heard evidence of how Miss Panton had filed a story from the office of Scotland Yard’s head of press, Dick Fedorcio using his computer and email account.

She said she was under pressure to send her article to her news editors so it could be edited for that weekend's paper.