Rupert Murdoch and the Corruption of the British Media

[Douglas Caddy]

Rupert Murdoch to split News Corp early to limit fallout from hacking scandal

Rupert Murdoch’s News Corporation is preparing to split on December 31, as it attempts to limit the damage of the News of the World phone hacking scandal on the rest of the media empire, the Daily Telegraph can reveal.

By Katherine Rushton, Media, telecoms and technology editor

7:55PM GMT 02 Dec 2012

The Telegraph

Robert Thomson, managing editor of the Wall Street Journal and editor in chief of Dow Jones, is expected to be named chief executive of the publishing division, which will be separated off in the carve up.

News Corp said in June that it would separate its troubled newspaper and book publishing assets from its more valuable film and television businesses, which generate 74pc of its $33.4bn a year revenues and 90pc of its profits.

At the time, Mr Murdoch said he hoped to complete the process within 12 months but that he had been advised by his finance and legal times that it could take longer. However, the businesses will be separated much sooner than expected, in a move that is set to please investors.

Mr Murdoch will retain his iron grip on the empire, by becoming chairman of both operations and chief executive of the entertainment arm, whose assets range from Fox Television and a 39pc stake in BSkyB to Twentieth Century Fox film studios.

However, the question of who would lead the beleaguered publishing division had remained open until Mr Murdoch alighted on Mr Thomson, a former editor of the Times.

The two men share a deep love of newspapers – something that some of the other contenders for the title lacked – but this is not all they have in common. Both Mr Murdoch and Mr Thomson come from Australia, share the same birthday and have Chinese wives. Mr Thomson was the only non-family member from News Corp to attend the baptism of Mr Murdoch’s youngest daughters in the river Jordan, whilst Mr Thomson made Mr Murdoch godfather to his two sons.

“Robert is part of Rupert’s inner circle. He is fond of Robert in the same way he was of Rebekah Brooks [the former News International chief executive], whom he regarded as some kind of surrogate daughter,” a source told The Daily Telegraph.

More importantly for News Corp, Mr Thomson shares Mr Murdoch’s combative approach to the establishment and willingness to make cuts if necessary. The question over what to do at the financially struggling New York Post will be at the top of his to-do list.

Mr Thomson’s probably move to the helm of News Corp’s publishing division is also expected to trigger a shake-up of other executive roles, with sources speculating that James Harding, editor of the Times, could move across to the Wall Street Journal.

However, Mr Thomson’s ascendance at News International will come as a blow to Tom Mockridge, chief executive of the company’s UK newspaper division, News International, who had also been widely tipped to lead the new publishing arm. Sources thought he would land the job partly as a reward for agreeing to swap his job as chief executive of Sky Italia to help revive the troubled newspaper business after it was left in tatters by the phone hacking scandal.

Other potential contenders included Lachlan Murdoch, already a member of the News Corp board, although his father Rupert Murdoch had indicated in recent weeks that this was looking unlikely. News Corp is already facing charges of nepotism and Lachlan Murdoch has shown little interest in the newspapers, or leaving his existing job in Australia.

Mr Murdoch has claimed that News Corp’s split into two divisions has nothing to do with the phone hacking or police bribery scandals in the UK, that have engulfed the entire company and left its reputation in tatters. However, the separation will allow the business to draw a clean line between its damaged publishing assets and the most valuable parts of the empire.

[Douglas Caddy]

http://www.guardian.co.uk/media/us-news-blog/2012/dec/03/elisabeth-murdoch-profile-new-yorker

[Steve Knight]

http://www.alternet.org/media/bill-moyers-fcc-may-give-murdoch-very-merry-christmas-two-last-big-newspapers-america?akid=9778.286388.ef5Z09&rd=1&src=newsletter757352&t=3

Bill Moyers: FCC May Give Murdoch a Very Merry Christmas - Two of the Last Big Newspapers in America

An outrageous media consolidation scandal is in the works

December 5, 2012 |

From BillMoyers.com (Preview of Moyers' interview broadcast for this weekend with Sen. Bernie Sanders on media consolidation at the bottom of this article ):

Until now, this hasn’t been the best year for media mogul Rupert Murdoch. For one, none of the Republicans who’d been on the payroll of his Fox News Channel — not Newt Gingrich or Rick Santorum or Mike Huckabee or Sarah Palin — became this year’s GOP nominee for president.

Oh sure, when Mitt Romney got the nod instead, Murdoch’s TV and newspaper empire backed him big time, but on Election Night, Fox pundits like Dick Morris and Karl Rove — the top GOP strategist and fundraiser — had to eat crow as Barack Obama won a second term in the White House, despite their predictions of a Republican landslide. (When the network called Ohio and the election for Obama, a desperate Rove tried to keep Fox statisticians from doing their job until the facts couldn’t be ignored or denied. New York magazine reports that Fox News programming chief Bill Shine now “has sent out orders mandating that producers must get permission before booking Rove or Morris.”)

On top of all that, just this week, Murdoch’s News Corp announced the shutdown of The Daily, its multimillion dollar attempt at a national iPad newspaper. And last week in London, the thousand-page report of an independent inquiry into the gross misconduct of the British press came out — that big scandal over reporters illegally hacking into people’s cell phones and committing other assorted forms of corruption, including bribery. Murdoch’s gossip sheet, The News of the World, was right at the center of it, the worst offender. The fallout cost Murdoch the biggest business deal of his career — the multi-billion buyout of satellite TV giant BSkyB — and the report attacked his now-defunct News of the World for its “failure of management” and “general lack of respect for individual privacy and dignity.”

But Murdoch’s luck may be changing. Despite Fox News’ moonlighting as the propaganda ministry of the Republican Party, President Obama’s team may be making it possible for Sir Rupert to increase his power, perversely rewarding the man who did his best to make sure Barack Obama didn’t have a second term. The Federal Communications Commission could be preparing him one big Christmas present, the kind of gift that keeps on giving — unless we all get together and do something about it.

All indications are that Murdoch has his eye on two of the last remaining big newspapers in America — the Chicago Tribune and the Los Angeles Times, each owned by the now bankrupt Tribune Company. He could add one or both to his impressive portfolio, but even though the media mogul is splitting News Corp into two separately traded companies — one for its print entities, the other for TV and film — he would still come under current rules restricting media companies from owning newspapers and TV and radio stations in the same town. However, the FCC may be planning to suspend those rules, paving the way for Murdoch’s takeover of either of the two papers.

In prior years, the FCC has granted waivers to the rules, but this latest move on their part would be more permanent, allowing a monolithic corporation like News Corp or Disney, Comcast, Viacom, CBS or Time Warner — in any of the top twenty markets — to own newspapers, two TV stations, eight radio stations and even the local Internet provider.

Once again, massive media conglomerates would be given free rein to gobble up more and more of our communications outlets, increasing their already considerable power, destroying independent voices, diluting or eradicating local news and community affairs coverage, eliminating competition and stomping even further on diversity. A recent study — from the FCC itself — shows that last year female ownership of commercial TV and radio stations is at 6.8 percent, Latino ownership is 2.8 percent, Asian ownership is half a percent, and African American ownership of commercial stations actually has decreased to less than one percent.

Suspending the current rules would only make this awful situation worse, which is one of the reasons why Vermont’s independent Senator Bernie Sanders and several of his Senate colleagues sent a letter last week to FCC Chairman Julius Genachowski. “Congress tasked you with a mandate to promote localism and diversity in America’s broadcast system,” they wrote. “While the current ownership rules have not completely achieved these goals, they nonetheless remain a bulwark against mass consolidation and stand to preserve local voices.”

This is not the first time the Federal Communications Commission has tried to change the rules. In 2003 and again five years ago, while George W. Bush was still in the White House, a Republican-dominated FCC made a similar attempt to sneak them past but the suspension was rejected by both the Senate and a Federal appeals court. Public comments — three million of them — ran ninety-nine percent against the attempt to make the media behemoths even bigger and more avaricious than ever. Among the opponents: freshman Senator Barack Obama and Senators Joe Biden and Hillary Clinton.

Under Genachowski, the FCC has from time to time upheld its mandate to protect the public interest — the recent decision to increase the number of low power community FM stations, for example, or the ruling that gave the public on-line access to who’s buying political ads on TV and radio, and how much they’re spending. But this time, it seems as if Chairman Genachowski may be trying to rush the rules change through on a technicality without sufficient time for public comments or even an open hearing.

Make your voices heard — write or call Genachowski and the other commissioners – you can find theirnames, e-mail addresses and phone numbers at the website fcc.gov, or on the “Take Action” page at our website, BillMoyers.com. Write your senators and representatives, too, tell them the FCC must delay this decision and give the public a chance to have its opposition known. We’ve done it before.

Just ask the FCC this basic question: What part of “no” don’t you understand?

So, basically, the FCC are giving this criminal the keys to the kingdom....without investigating what his empire has done over there?

WOW! That's pretty much as bad as our government letting the worst of his excesses slide out of being punished, and refusing to follow the Inquiry's recommendations about a legal underpinning for an independent review board on Press Complaints...

[John Dolva]

Leveson's Punch and Judy show on the press masks 'hacking' on a scale you can barely imagine

6 December 2012

In the week Lord Leveson published almost a million words about his inquiry into the "culture, practice and ethics" of Britain's corporate press, two illuminating books about media and freedom were also published. Their contrast with the Punch and Judy show staged by Leveson is striking.

For 36 years, Project Censored, based in California, has documented critically important stories unreported or suppressed by the media most Americans watch or read. This year's report is Censored 2013: Dispatches from the media revolution by Mickey Huff and Andy Lee Roth (Seven Stories Press). They describe the omissions of "mainstream" journalism as "history in the un-making". Unlike Leveson, their investigation demonstrates the sham of a system claiming to be free. Among their top 25 censored stories are these:

Since 2001, the United States has erected a police state apparatus including a presidential order that allows the US military to detain anyone indefinitely without trial. FBI agents are now responsible for the majority of terrorist plots, with a network of 15,000 spies "encouraging and assisting people to commit crimes". Informants receive cash rewards of up to $100,000.

The bombing of civilian targets in Libya in 2011 was often deliberate and included the main water supply facility that provided water to 70 per cent of the population. In Afghanistan, the murder of 16 unarmed civilians, including children, attributed to one rogue US soldier, was actually committed by "multiple" soldiers, and covered up. In Syria, the US, Britain and France are funding and arming the icon of terrorism, al-Qaida. In Latin America, one US bank has laundered $378bn. in drug money.

In Britain, this world of subjugated news and information is concealed behind a similar façade of a "free" media, which promotes the extremisms of state corruption and war, consumerism and an impoverishment known as "austerity". Leveson devoted his "inquiry" to the preservation of this system. My favourite laugh-out-loud quote of His Lordship is: "I have seen no basis at any stage for challenging the integrity of the police."

Those who have long tired of deconstructing the clichés and deceptions of "news" say: "At least there is the internet now."

Yes, there is, but for how long? Alfred W. McCoy, the great American chronicler of imperialism, quotes Obama in one of the recent election debates. "We need to be thinking about cyber security," said Obama. "We need to be thinking about space." McCoy calls this revolutionary. "Not a single commentator seemed to have a clue when it came to the profound strategic changes encoded in the president's sparse words," he wrote. "Yet, for the past four years, working in silence and secrecy, the Obama administration has presided over a technological revolution... moving the nation far beyond bayonets and battleships to cyber warfare, the weaponisation of space [and] a breakthrough in what's called 'information warfare'."

This is about "hacking" on a vast scale by the state and its intelligence and military arms and "security" corporations. It was unmentionable at the Leveson inquiry, even though the internet was within Leveson's remit. It is the subject of Cypherpunks: Freedom and the future of the internet by Julian Assange with Jacob Appelbaum, Andy Muller-Maguhn and Jeremie Zimmermann (OR Books). That the Guardian, a principal gatekeeper of liberal debate in Britain, should describe their published conversation as "dystopian musings" is unsurprising. Understanding what they have to say is to abandon the vicarious as journalism and embrace the real thing.

"The internet was supposed to be a civilian space," Assange writes. "[it] is our space, because we all use it to communicate with each other and with members of our family... Ten years ago [mass interception] was seen to be a fantasy, something only paranoid people believed in" but now the internet is becoming "a militarized zone." When everyone can be intercepted en masse, spying on individuals is redundant. Stasi, the East German secret police, "penetrated" 10 per cent of East Germany society. Today, the cost of intercepting and storing all telephone calls in Germany in a year is less than eight million euros. More than 175 companies now sell the surveillance of whole countries. A whistleblower at the giant US telecommunications company AT&T has disclosed that the National Security Agency (NSA) allegedly took every phone call, every internet connection. The NSA intercepts 1.6 bn. personal communications every day.

To the "national security state", of which the US is the pioneer and model, "perpetual war" is a given; and the public are the enemy - not terrorists. Google, Facebook and Twitter are all based in the US. In December 2010, Twitter was ordered by the Justice Department to surrender its clients' personal information relevant to the Obama administration's pursuit of WikiLeaks, no matter where in the world people lived. Obama has pursued twice as many whistleblowers as all US presidents combined. This is why Assange and Bradley Manning are targets - along with those rare journalists who do their job and publish in the public interest. Like Assange they, too, are liable to be prosecuted for espionage, regardless of what the US Constitution says. A whistleblower at the NSA, Bill Binney, describes this as "turnkey totalitarianism".

The iniquity of Rupert Murdoch was not his "influence" over the Tweedledees and Tweedledums in Downing Street, nor the thuggery of his eavesdroppers, but the augmented barbarism of his media empire in promoting the killing, suffering and dispossession of countless men, women and children in America's and Britain's illegal wars.

Murdoch has plenty of respectable accomplices. The liberal Observer was as rabid a devotee of the Iraq invasion. When Tony Blair gave evidence to the Leveson inquiry, bleating about the media's harassment of his wife, he was interrupted by a filmmaker, David Lawley-Wakelin, who described him as a war criminal. At that, Lord Leveson leapt to his feet and ordered the truth-teller thrown out and apologised to the war criminal. Such an exquisite display of irony is contemptuous of all of us.

[Douglas Caddy]

News Corporation spends £100m on management and standards committee

Team set up to probe alleged illegal activity after phone-hacking scandal is costing more than £1m a week

By Josh Halliday

Guardian

Thursday 13 December 2012 06.35 EST

News Corporation's management and standards committee, established last year to root out alleged illegal activity at News International following the News of the World phone-hacking scandal, is costing Rupert Murdoch's newspaper group in excess of £1m a week and has cost £100m in total.

The expense of running the body – which has passed information relating to alleged phone hacking, corrupt payments to public officials and other potential illegal activity to Scotland Yard – amounted to £76.8m in the year to 30 June 2012, according to accounts filed at Companies House on Tuesday. That figure dwarfs the £17.5m paid out in damages and legal fees to civil claimants over phone hacking and other alleged invasions of privacy.

It is the largest of a string of mostly phone hacking-related charges that together amount to a quarter of a billion pounds that ensured that News Corp's traditionally profitable British businesses – the Sun, Times and Sunday Times publisher News International and Harper Collins UK – ran up an overall loss of £189.4m on turnover of £1.18bn.

The cost of MSC, which is working with lawyers from Linklaters and Olswang, reached £99.7m between 31 June 2011 and 26 November 2012, according to the Companies House filings.

The body, chaired by top commercial lawyer Lord Grabiner, was set up by News Corp in early 2011 to investigate allegations of criminal offences by journalists at the now-closed News of the World, the Sun, the Times and Sunday Times.

The phone-hacking saga cost News International £140.9m in the year to 1 July, according to accounts filed by NI Group Limited, the parent company of Murdoch's UK newspapers.

Part of this £140.9m is the £76.8m costs in relation to the MSC, plus a further £17.5m in claimants' legal fees and damages. The company incurred an additional £46.6m charge in relation to the closure of the News of the World.

Restructuring costs at News International reached £51.6m in the period, the accounts show, including £22.2m in redundancy payments to News of the World staff after its abrupt closure last summer.

The £150m sale in May of News International's Wapping site contributed to a loss on disposal of fixed assets of £65.2m in the year to 30 June.

Edited December 14, 2012 by Douglas Caddy

[John Simkin]

News Corporation spends £100m on management and standards committee

Team set up to probe alleged illegal activity after phone-hacking scandal is costing more than £1m a week

After reading their accounts most of this money was spent on hush-payments to former employees.

[Douglas Caddy]

Why the US media ignored Murdoch's brazen bid to hijack the presidency

Did the Washington Post and others underplay the story through fear of the News Corp chairman, or simply tin-eared judgment?

By Carl Bernstein

ThGuardian, Thursday 20 December 2012 11.41 EST

So now we have it: what appears to be hard, irrefutable evidence of Rupert Murdoch's ultimate and most audacious attempt – thwarted, thankfully, by circumstance – to hijack America's democratic institutions on a scale equal to his success in kidnapping and corrupting the essential democratic institutions of Great Britain through money, influence and wholesale abuse of the privileges of a free press.

In the American instance, Murdoch's goal seems to have been nothing less than using his media empire – notably Fox News – to stealthily recruit, bankroll and support the presidential candidacy of General David Petraeus in the 2012 election.

Thus in the spring of 2011 – less than 10 weeks before Murdoch's centrality to the hacking and politician-buying scandal enveloping his British newspapers was definitively revealed – Fox News' inventor and president, Roger Ailes, dispatched an emissary to Afghanistan to urge Petraeus to turn down President Obama's expected offer to become CIA director and, instead, run for the Republican nomination for president, with promises of being bankrolled by Murdoch. Ailes himself would resign as president of Fox News and run the campaign, according to the conversation between Petraeus and the emissary, K T McFarland, a Fox News on-air defense "analyst" and former spear carrier for national security principals in three Republican administrations.

All this was revealed in a tape recording of Petraeus's meeting with McFarland obtained by Bob Woodward, whose account of their discussion, accompanied online by audio of the tape, was published in the Washington Post – distressingly, in its style section, and not on page one, where it belonged – and, under the style logo, online on December 3.

Indeed, almost as dismaying as Ailes' and Murdoch's disdain for an independent and truly free and honest press, and as remarkable as the obsequious eagerness of their messenger to convey their extraordinary presidential draft and promise of on-air Fox support to Petraeus, has been the ho-hum response to the story by the American press and the country's political establishment, whether out of fear of Murdoch, Ailes and Fox – or, perhaps, lack of surprise at Murdoch's, Ailes' and Fox's contempt for decent journalistic values or a transparent electoral process.

The tone of the media's reaction was set from the beginning by the Post's own tin-eared treatment of this huge story: relegating it, like any other juicy tidbit of inside-the-beltway media gossip, to the section of the newspaper and its website that focuses on entertainment, gossip, cultural and personality-driven news, instead of the front page.

"Bob had a great scoop, a buzzy media story that made it perfect for Style. It didn't have the broader import that would justify A1," Liz Spayd, the Post's managing editor, told Politico when asked why the story appeared in the style section.

Buzzy media story? Lacking the "broader import" of a front-page story? One cannot imagine such a failure of news judgment among any of Spayd's modern predecessors as managing editors of the Post, especially in the clear light of the next day and with a tape recording – of the highest audio quality – in hand.

"Tell [Ailes] if I ever ran," Petraeus announces on the crystal-clear digital recording and then laughs, "but I won't … but if I ever ran, I'd take him up on his offer. … He said he would quit Fox … and bankroll it."

McFarland clarified the terms: "The big boss is bankrolling it. Roger's going to run it. And the rest of us are going to be your in-house" – thereby confirming what Fox New critics have consistently maintained about the network's faux-news agenda and its built-in ideological bias.

And here let us posit the following: were an emissary of the president of NBC News, or of the editor of the New York Times or the Washington Post ever caught on tape promising what Ailes and Murdoch had apparently suggested and offered here, the hue and cry, especially from Fox News and Republican/Tea Party America, from the Congress to the US Chamber of Commerce to the Heritage Foundation, would be deafening and not be subdued until there was a congressional investigation, and the resignations were in hand of the editor and publisher of the network or newspaper. Or until there had been plausible and convincing evidence that the most important elements of the story were false. And, of course, the story would continue day after day on page one and remain near the top of the evening news for weeks, until every ounce of (justifiable) piety about freedom of the press and unfettered presidential elections had been exhausted.

The tape of Petraeus and McFarland's conversation is an amazing document, a testament to the willingness of Murdoch and the wily genius he hired to create Fox News to run roughshod over the American civic and political landscape without regard to even the traditional niceties or pretenses of journalistic independence and honesty. Like the revelations of the hacking scandal, which established beyond any doubt Murdoch's ability to capture and corrupt the three essential elements of the British civic compact – the press, politicians and police – the Ailes/Petraeus tape makes clear that Murdoch's goals in America have always been just as ambitious, insidious and nefarious.

The digital recording, and the dead-serious conspiratorial conversation it captures so chillingly in tone and substance ("I'm only reporting this back to Roger. And that's our deal," McFarland assured Petraeus as she unfolded the offer) utterly refutes Ailes' disingenuous dismissal of what he and Murdoch were actually attempting: the buying of the presidency.

"It was more of a joke, a wiseass way I have," Ailes would later claim while nonetheless confirming its meaning. "I thought the Republican field [in the primaries] needed to be shaken up and Petraeus might be a good candidate."

The recording deserves to be heard by any open-minded person trying to fathom its meaning to the fullest.

Murdoch and Ailes have erected an incredibly influential media empire that has unrivaled power in British and American culture: rather than judiciously exercising that power or improving reportorial and journalistic standards with their huge resources, they have, more often than not, recklessly pursued an agenda of sensationalism, manufactured controversy, ideological messianism, and political influence-buying while masquerading as exemplars of a free and responsible press. The tape is powerful evidence of their methodology and reach.

The Murdoch story – his corruption of essential democratic institutions on both sides of the Atlantic – is one of the most important and far-reaching political/cultural stories of the past 30 years, an ongoing tale without equal. Like Richard Nixon and his tapes, much attention has been focused on the necessity of finding the smoking gun to confirm what other evidence had already established beyond a doubt: that the elemental instruments of democracy, ie the presidency in Nixon's case, and the privileges of free press in Murdoch's, were grievously misused and abused for their own ends by those entrusted to use great power for the common good.

In Nixon's case, the system worked. His actions were investigated by Congress, the judicial system held that even the president of the United States was not above the law, and he was forced to resign or face certain impeachment and conviction. American and British democracy has not been so fortunate with Murdoch, whose power and corruption went unchecked for a third of a century.

The most important thing we journalists do is make judgments about what is news. Perhaps no story has eluded us on a daily basis (for lack of trying) for so many years as the story of Murdoch's destructive march across our democratic landscape. Only the Guardian vigorously pursued the leads of the hacking story and methodically stuck with it for months and years, never ignoring the underlying context of how Rupert Murdoch conducted his take-no-prisoners business and journalism without regard for the most elemental standards of fairness, accuracy or balance, or even lawful conduct.

When the Guardian's hacking coverage reached critical mass last year, I quoted a former top Murdoch deputy as follows: "This scandal and all its implications could not have happened anywhere else. Only in Murdoch's orbit. The hacking at News of the World was done on an industrial scale. More than anyone, Murdoch invented and established this culture in the newsroom, where you do whatever it takes to get the story, take no prisoners, destroy the competition, and the end will justify the means."

The tape that Bob Woodward obtained, and which the Washington Post ran in the style section, should be the denouement of the Murdoch story on both sides of the Atlantic, making clear that no institution, not even the presidency of the United States, was beyond the object of his subversion. If Murdoch had bankrolled a successful Petraeus presidential campaign and – as his emissary McFarland promised – "the rest of us [at Fox] are going to be your in-house" – Murdoch arguably might have sewn up the institutions of American democracy even more securely than his British tailoring.

Happily, Petraeus was not hungering for the presidency at the moment of the messenger's arrival: the general was contented at the idea of being CIA director, which Ailes was urging him to forgo.

"We're all set," said the emissary, referring to Ailes, Murdoch and Fox. "It's never going to happen," Petraeus said. "You know it's never going to happen. It really isn't. … My wife would divorce me."

[John Simkin]

Why the US media ignored Murdoch's brazen bid to hijack the presidency

Did the Washington Post and others underplay the story through fear of the News Corp chairman, or simply tin-eared judgment?

By Carl Bernstein

ThGuardian, Thursday 20 December 2012 11.41 EST

So now we have it: what appears to be hard, irrefutable evidence of Rupert Murdoch's ultimate and most audacious attempt – thwarted, thankfully, by circumstance – to hijack America's democratic institutions on a scale equal to his success in kidnapping and corrupting the essential democratic institutions of Great Britain through money, influence and wholesale abuse of the privileges of a free press.

In the American instance, Murdoch's goal seems to have been nothing less than using his media empire – notably Fox News – to stealthily recruit, bankroll and support the presidential candidacy of General David Petraeus in the 2012 election.

Very interesting in the way that the American press treated this story.

[Douglas Caddy]

In Filing, News Corp. Says Publishing Business Showed $2.1 Billion Loss

By AMY CHOZICK

The New York Times

December 21, 2012

Potential investors got a glimpse of the financial challenges that Rupert Murdoch's soon-to-be spun-off publishing company could face. In a regulatory filing, News Corporation said its publishing businesses lost $2.1 billion in the fiscal year that ended June 30.

The disclosure was filed to the Securities and Exchange Commission on Friday, as the media conglomerate prepares to split its publishing assets from its more lucrative entertainment segments. The new, stand-alone company will retain the name News Corporation and include newspapers like The Wall Street Journal, The New York Post and The Times of London; the HarperCollins book publisher; and a handful of fast-growing Australian pay-television assets.

The entertainment company, which will be called the Fox Group, will include 20th Century Fox studios, Fox Broadcasting and cable channels like Fox News and FX. That company has annual revenue of more than $23 billion.

The losses in the publishing business came largely from $2.8 billion in impairment and restructuring charges, mostly related to the closure of The News of the World tabloid in Britain, which was shut down in July 2011 after revelations of widespread phone hacking. Revenue at the publishing business fell to $8.65 billion in fiscal year 2012, from $9.1 billion a year earlier.

The S.E.C. Form 10 filing moves the company closer toward the split and gives shareholders a better idea of what the stand-alone publishing company, called "New News Corporation" in the report, will look like financially when the spinoff is completed in mid-2013.

The company warned investors that "newspaper and advertising circulation revenues have been declining, reflecting general trends in the newspaper industry." In addition to industrywide headwinds, the company said illegal activity at its British newspapers "could damage New News Corporation's reputation and might impair its ability to conduct its business."

As additional civil lawsuits related to phone hacking are filed in Britain, News Corporation said it "is not able to predict the ultimate outcome or cost associated with these investigations."

The fallout from the phone hacking scandal, and an investor base that increasingly expressed disapproval of the newspaper business, prompted Mr. Murdoch to announce the split of his $60 billion media conglomerate in June.

"The filing of the Form 10 is another important step forward in the evolution of our company and in the establishment of two independent global leaders in Fox Group and the new News Corporation," said Mr. Murdoch, who serves as chairman and chief executive of the combined News Corporation.

Earlier this month Mr. Murdoch said Robert Thomson, a confidant and the former managing editor at The Wall Street Journal, would serve as chief executive of the new News Corporation. Mr. Murdoch will continue to serve as chairman of both companies and chief executive of the Fox Group.

In his new role Mr. Thomson, 51, will have a base salary of $2 million with a performance-based $2 million bonus, according to the filing.

In addition to hundreds of newspapers on several continents, the publishing company will also include Australia's RealEstate.com.au; Fox Sports in Australia; 50 percent of Foxtel, the No. 1 pay-TV provider in Australia; and 44 percent of Sky Network Television in New Zealand. Analysts expect those businesses to drive profits and support some of the weaker newspapers.

Fox Sports had revenue of $3.6 billion and Foxtel of $2.5 billion in 2012. Those results were not included in the publishing company's 2012 earnings, but will contribute to the new company's bottom line.

[Douglas Caddy]

Weekend Edition December 21-23, 2012

www.counterpunch.org

Carl Bernstein Caught in the Matrix

Why the Washington Post Killed the Story of Murdoch’s Bid to Buy the US Presidency

by JONATHAN COOK

Carl Bernstein, of All the President’s Men fame, has a revealing commentary in the Guardian today, though revealing not entirely in a way he appears to understand. Bernstein highlights a story first disclosed earlier this month in the Washington Post by his former journalistic partner Bob Woodward that media mogul Rupert Murdoch tried to “buy the US presidency”.

A taped conversation shows that in early 2011 Murdoch sent Roger Ailes, the boss of his most important US media outlet, Fox News, to Afghanistan to persuade Gen David Petraeus, former commander of US forces, to run against Barack Obama as the Republican candidate in the 2012 presidential election. Murdoch promised to bankroll Petraeus’ campaign and commit Fox News to provide the general with wall-to-wall support.

Murdoch’s efforts to put his own man in the White House failed because Petraeus decided he did not want to run for office. “Tell [Ailes] if I ever ran,” Petraeus says in the recording, “but I won’t … but if I ever ran, I’d take him up on his offer.”

Bernstein is rightly appalled not just by this full-frontal attack on democracy but also by the fact that the Washington Post failed to splash with their world exclusive. Instead they buried it inside the paper’s lifestyle section, presenting it as what the section editor called “a buzzy media story that … didn’t have the broader import” that would justify a better showing in the paper.

In line with the Washington Post, most other major US news outlets either ignored the story or downplayed its significance.

We can probably assume that Bernstein wrote his piece at the bidding of Woodward, as a covert way for him to express his outrage at his newspaper’s wholesale failure to use the story to generate a much-deserved political scandal. The pair presumably expected the story to prompt congressional hearings into Murdoch’s misuse of power, parallel to investigations in the UK that have revealed Murdoch’s control of politicians and the police there.

As Bernstein observes: “The Murdoch story – his corruption of essential democratic institutions on both sides of the Atlantic – is one of the most important and far-reaching political/cultural stories of the past 30 years, an ongoing tale without equal.”

What Bernstein cannot understand is why his media masters don’t see things the way he does. He reserves his greatest dismay for “the ho-hum response to the story by the American press and the country’s political establishment, whether out of fear of Murdoch, Ailes and Fox – or, perhaps, lack of surprise at Murdoch’s, Ailes’ and Fox’s contempt for decent journalistic values or a transparent electoral process.”

But in truth neither of Bernstein’s explanations for this failure is convincing.

A far more likely reason for the US media’s aversion to the story is that it poses a danger to the Matrix-like wall of static interference generated by precisely the same media that successfully conceals the all-too-cosy relationship between the corporations (that own the media) and the country’s politicians.

The Petraeus story is disturbing to the media precisely because it tears away the façade of US democratic politics, an image carefully honed to persuade the American electorate that it chooses its presidents and ultimately decides the direction of the country’s political future.

Instead, the story reveals the charade of that electoral game, one in which powerful corporate elites manipulate the system through money and the media they own to restrict voters’ choice to two almost-identical candidates. Those candidates hold the same views on 80 per cent of the issues. Even where their policies differ, most of the differences are quickly ironed out behind the scenes by the power elites through the pressure they exert on the White House via lobby groups, the media and Wall Street.

The significance of Woodward’s story is not that it proves Rupert Murdoch is danger to democracy but rather that it reveals the absolute domination of the US political system by the global corporations that control what we hear and see. Those corporations include, of course, the owners of the Washington Post.

The saddest irony is that the journalists who work within the corporate media are incapable of seeing outside the parameters set for them by their media masters. And that includes even the most accomplished practitioners of the trade: Woodward and Bernstein.

Jonathan Cook won the Martha Gellhorn Special Prize for Journalism. His latest books are “Israel and the Clash of Civilisations: Iraq, Iran and the Plan to Remake the Middle East” (Pluto Press) and “Disappearing Palestine: Israel’s Experiments in Human Despair” (Zed Books). His new website is www.jonathan-cook.net.

[Douglas Caddy]

Rupert Murdoch's make-or-break venture: the new News Corp

As the octogenarian mogul marshals his ailing newspaper group, he faces the sternest test of his business acumen to date

By Michael Wolff

guardian.co.uk,

Monday 31 December 2012 16.01 EST

In my world, one of the great sports of the New Year is going to be watching Rupert Murdoch de-hitch his newspapers from his entertainment companies. Seldom, in a business context, has a man of such stature and accomplishment and at so advanced an age been asked not just to reinvent himself, but to prove himself all over again.

He may retain the CEO title for his entertainment company, but nobody doubts that his heart and time will be invested with his papers.

Murdoch's stand-alone newspaper company is his naked being. In a sense, it undoes one of his guiding business principles: building profitable businesses to cover the ever-faltering fortunes of his newspapers, the business he most loves. (There is a further justification in holding newspapers: they gave him the clout to help build the other businesses that make the big money.)

But his world now devolves more and more to the newspapers alone, at just the point in time when newspapers alone are the most vulnerable they might ever be.

There are three key indicators that will give an indication of what kind of island Murdoch has pushed himself off on – or been banished to. They will show up in the filings, anticipated early this year, necessary to make his newspapers an independent company:

First, the actual business results of the papers, being, individually, so much smaller than other business units, have long been wrapped in a goodly amount of smoke – but now that clears. Some of the great money pits of the media industry ought to be open soon for all to see. The New York Post, for instance, has likely not made money in more than 40 years – and most observers guess it is losing well north of $60m a year.

The Wall Street Journal, and its radical remake into a general interest newspaper, has, without much information as to its actual performance, generally been judged a success. How will that change – and how will regard for the new company's just appointed CEO, Robert Thomson, who has been running the Journal, change – if the Journal's losses are shown to be vast?

Second, because the new company is so exposed, it will depend on a dowry from its rich parent: so how much? Of the substantial cash on hand in the current company, how much does the newspaper company get?

This will likely be in the form of a division of cash assets; a continuing credit line from the larger company to the weaker one; and other financial engineering backstops and links. It is in this way that Murdoch will try most to dilute the effects of separation of the two companies and the isolation of his papers.

Third, while this has so far been billed as a spin-off of the newspaper assets from the larger mothership, what we need to see are the nature of the mechanics of the split: that is, who is really splitting from whom. A possible tip-off, which came unheralded last month, was that the theoretically new company will continue with the name News Corp, and the theoretical mothership company will be the Fox Group.

In part, this is probably sentiment: Rupert holding on to this true patrimony. But it may be too that the spin-off is happening in reverse, Fox Group being jettisoned from News Corp. The advantage here is that the myriad legal liabilities, in the UK, and potentially mounting exposure to the US justice department connected with the hacking and bribery scandals in the Britain, would be left with the newspapers that caused the problems.

In a wave of the hand, the Murdoch family's wealth might now be safely secured in the Fox Group, and the newspapers left to pay the piper.

But this is not mere sophistry and corporate trickery. This is, in all its implications and drama and ambition, a last stand.

Whatever Murdoch has been, or ever wanted, or, arguably, deserved to get, is now in play. And by all reports of where Murdoch has been going, and who he has been talking to, he means to try to make this work – that is, to triumph over the hand he's been dealt.

Already, he has implemented draconian cuts in his Australian newspaper operation. The Australian papers are (save for the Australian itself) still substantially profitable, so he needs their cash flow to buoy the markets he cares more deeply about.

He seems about to make a bet that the US newspaper market has hit bottom; that, at the very least, the LA Times and the Chicago Tribune are good deals to be had. Indeed, that's his other, unheralded skill – a savant-like brilliance when it comes to manufacturing and distribution efficiencies in the newspaper business – with which he believes he can grow margins very quickly.

And he seems genuinely focused on trying to figure out what the newspaper business will be post-deluge, the new "newsonomics", in my friend Ken Doctor's word. (Ken, a leading thinker about the fate of newspapers, had not told me Murdoch has consulted him, but I'm sure he has: he's consulting everybody.)

Murdoch's two most immediate problems remain the New York Post and the Times in London – with the Wall Street Journal's likely losses also keeping him up at night. At the Journal, at least, there is an argument about the franchises it can build and the world of data in can exploit. And the Times has some wiggle-room if it becomes part of a seven-day operation lead by the Sunday Times. And, if need be, it can be sold to any number of eager buyers.

There are no such arguments or wiggle-room or buyers for the New York Post. Its immediate fate will be a good indication of whether this new News Corp is a death spiral, or, if Mr-Don't-Look-Back is actually ready to be as ruthless and unsentimental as he has so often been – though never with the Post.

Still, Murdoch may be as Murdoch as he has ever been, but that does not make him more than a newspaper man from the 1950s and 1960s trying to retail his skills in a new world. (The Daily, the recently closed digital experiment that he personally oversaw, was just that: a tone-deaf, middle-market paper on a tablet.)

Indeed, Murdoch has over the past four years demonstrated his best newspaper skills and tricks, devoting a disproportionate, if not extraordinary, amount of his business time to overhauling the Wall Street Journal. Next week, I'll look at how well that's worked for him.

[Douglas Caddy]

Rupert Murdoch's Wall Street Journal formula for News Corp renaissance

Never mind that the Journal has yet to yield him profit, Murdoch is convinced his transformation of the newspaper is a success

By By Michael Wolff

• guardian.co.uk, Monday 7 January 2013 11.28 EST
  

Rupert Murdoch did not transform the Wall Street Journal in the way many of his most passionate critics feared. But he did transform it – radically so – in ways that contain clues about his current thinking about newspapers and how he will lead the new, newspaper-focused company, which will soon come to stand alone from the entertainment side of his holdings.

When he bid for the Wall Street Journal in 2007, many Journal loyalists, along with his journalistic enemies, believed that, under Murdoch, the paper would necessarily cater to his views as well as become crasser in tone and style. Four years later, there is more puzzlement than outrage about what he and his deputy, Journal editor Robert Thomson, who will hold the CEO title in the new company, have done to the Journal.

Murdoch and Thomson took one of the most distinctive, stylized and "branded" voices in journalism – its look and feel recognizable at 30 paces – and flattened it. Adding signature Murdoch elements has not been the strategy: his political accents have been few, his tabloid flare absent. Instead, the strategy has been to cleanse it of identifying marks. The Wall Street Journal, which was a shrinking business when Murdoch bought it, with its profit margins whittled to almost nothing, is now a highly-proficient, well-executed information product – no more, no less.

And oh, yes: with significant new investment, it loses more money than it ever did.

Curiously, or eccentrically, Murdoch also shifted the paper's coverage from all business – it was to business, as the New Testament is to Christianity – to much less business and much more general politics and international coverage. Why? Why would you throw out the most important aspect of what you so expensively acquired?

And what does this say about the new properties – the Chicago Tribune, the LA Times, the Financial Times, the New York Times, and the Washington Post, among them (that is, every newspaper that might possibly be for sale) – that are on his wishlist?

Murdoch has several hardcore beliefs about the newspaper business:

1) It's not the business that has failed, or become obsolete. The problem is with newspapers themselves: they started to speak more to elites, or worse, to only other journalists, rather than to the people who read, or who ought to be reading, them.

2) Newspapers are mass media and need to define their audience in the broadest possible way: in Australia, it's the middle market; in Britain, in the 1970s, it was the lower market; with the Wall Street Journal, it's the broad upper market and not just the business market. The larger your universe, the better.

3) Snobbishness is the enemy: only the media itself likes a smarty pants. (The Daily, Murdoch's tablet-only newspaper, which closed last month, was another exercise in flat affect; Murdoch kept telling everyone he didn't want the Daily to be for the "digerati" – a new Murdoch bad word.)

4) Squeezing profits out of papers is more about smart manufacturing than it is about smart journalism.

5) And in order to truly force people to pay for newspapers online, you would have to own them all.

Now, almost everything here runs against the currents of modern publishing, which emphasizes carefully targeted audiences – as well as, of course, the elimination of manufacturing with the advent of digital distribution and, despite the occasional paywall, the relentless march of free. And yet, Murdoch believes he is a modernizer – a modernizer, albeit, who made his mark on newspapers in the 1950s, 60s and 70s, when he took fussy titles like the News of the World, the Sun, and the New York Post, and cast aside their old audiences for new demographic opportunities, and installed new presses to improve the product.

That isn't much different from what he's done with the Journal, seeking to be a one-stop national newspaper and making a big investment in production and manufacturing. Another instructive point about the Journal: Murdoch likes to run his business with a Murdoch editor – someone preternaturally responsive to what he wants. Murdoch has been bending editors to his will since 1953, but in Robert Thomson, he may have found his most acquiescent newsroom mate.

Thus, Thomson is now the new company's CEO. Arguably, his main duty is to channel the old man.

It is difficult to quite express the satisfaction Murdoch feels about the Wall Street Journal. For him, it's a fully realized vision. Long-time Journal staffers, in almost every conversation, continue to mourn the paper's lost meaning and culture, and to loathe Murdoch and Thomson for it. But Murdoch has done what he set out to do: wiped it clean of its superiority and swank. When he talks about the New York Times, he talks about cleansing it this way, too: it's his ultimate dream.

One of the aspects of the Journal that he is said to be most pleased about is the Journal's local section, with its almost folksy, middle-market, booster feel. (The section often bears a similarity to the classic 1978 National Lampoon parody of the Sunday edition of the Dacron, Ohio Republican-Democrat.)

Murdoch, as it happens, has never had a successful paper in the US. The New York Post, together with the papers he has previously owned in Boston, Chicago and Texas, have all been financial disappointments (if not catastrophes); the Wall Street Journal itself remains a long way from profitability. But he has now constituted a company of which a chief premise is that it will buy newspapers in the US.

This is a strategy that is, in part, born out of Murdoch's belief that newspapers, after a decade of nay-saying, are now vastly undervalued. And by having a network of papers and applying his talents for efficiencies, he believes he can realize big savings.

But it also comes from a remarkable stubbornness and righteousness. Murdoch has a near-messianic confidence that he knows what a newspaper reader wants and therefore what a newspaper should be. Newspapers ought to be an efficient vehicle to speak to many. When you start to weave in elements and features that speak to few, you go wrong: arcane stories, detailed investigations, excessive aesthetic considerations, long reads … they put off more than they attract.

To any quibbles, or attempts to argue for nuance, he points to the Journal – literally, holds it up with two hands – as his answer. This is his perfect paper: straightforward, unaffected, clean, giving you everything you need.

The past, even 60 years of it, is mere prologue – and Murdoch can hardly wait to begin.

[Douglas Caddy]

Trial Begins for Scotland Yard Officer in Phone-Hacking Scandal

By JOHN F. BURNS

The New York Times

January 7, 2013

LONDON — In the first of a number of high-profile trials expected this year in cases of alleged criminal wrongdoing at Britain’s freewheeling newspapers, a high-ranking Scotland Yard officer went on trial on Monday, charged with seeking to sell confidential police information to a tabloid that Rupert Murdoch ordered shut 18 months ago as the phone-hacking scandal erupted around his British newspaper empire.

The case against the officer, Detective Chief Inspector April Casburn, 53, stemmed from a telephone call in September 2010 in which, prosecutors say, she gave a reporter for The News of the World details of a newly reopened investigation into accusations of voice mail hacking by the tabloid. At the time of the call, Ms. Casburn was a senior officer in Scotland Yard’s top-secret counterterrorism unit, code-named SO15.

With at least six separate inquiries into different aspects of the scandal, and a total of 180 police officers and officials assigned to the work, the overall police operation has been described by senior police officials as the most extensive — and expensive — criminal investigation in Scotland Yard’s history. Altogether, more than 90 people have been arrested, though fewer than a dozen have been charged. Prosecutors have said that charges against others are likely to follow.

Investigations that have turned up evidence of police wrongdoing, in the form of alleged payments and other benefits given by the tabloids to serving officers in return for confidential information, have been a factor in a battery of high-level resignations. Police commanders say progress in the investigations, and successful prosecutions, will be an important test for Scotland Yard, formally known as the Metropolitan Police Service, whose reputation has been badly battered by the scandal.

In addition to corrupt payments to police and other public officials, the charges laid out so far by prosecutors include conspiracy to intercept cellphone messages, the touchstone of the investigations, involving hundreds of celebrities, politicians, sports stars and crime victims; and conspiracy to pervert the course of justice by destroying or hiding evidence, including e-mails and other documents.

Others facing trial this year include Andy Coulson, a News of the World editor who went on to become Prime Minister David Cameron’s communications director at 10 Downing Street; Rebekah Brooks, a former editor of two Murdoch tabloids, The News of the World and The Sun, who resigned as the chief executive of News International, the Murdoch newspaper subsidiary in Britain, as the scandal unfolded in 2011; and Charlie Brooks, Ms. Brooks’s husband, who is a prominent racehorse trainer and Eton College contemporary — and friend — of Mr. Cameron.

The focus of the trial that began Monday was a nine-minute phone call that the defendant, Ms. Casburn, made to The News of the World when she was responsible for a Scotland Yard unit that tracked terrorist financing, an assignment she won partly because of her background in investment finance in the City of London.

The prosecution says the call was prompted by a renewed investigation into the paper’s involvement in phone hacking that had begun the previous day. The court was told that the new inquiry, by John Yates, one of Scotland Yard’s top officers, had been ordered because of a magazine article detailing phone hacking by The News of the World that The New York Times had published 10 days earlier.

The prosecutor, Mark Bryant-Heron, said Ms. Casburn had told one of the tabloid’s reporters that Mr. Yates, then in charge of the Scotland Yard counterterrorism effort, was “looking at six people” as a result of the article. The two she named, the prosecutor said, were Mr. Coulson, the paper’s former editor, and Sean Hoare, a former reporter who was named in the Times article as confirming that phone hacking was rife at the paper when he worked there. Mr. Hoare died in 2011.

According to the prosecution’s account, Ms. Casburn explained her motive for the call by telling the reporter, Tim Wood, that she objected to the diversion of Scotland Yard’s counterterrorism resources to the phone-hacking inquiry and to the political pressure being brought to bear on Mr. Yates by John Prescott, a former deputy prime minister whose cellphone had been hacked.

The court was told that the tabloid did not publish an article on the basis of Ms. Casburn’s call and that no payment was made to her. In an e-mail to his editors cited in court, Mr. Wood said Ms. Casburn had asked to be paid, but the court was told that she had denied this in police interviews. On the stand, Mr. Wood seemed uncertain. While his “recollection” was “not great,” he said, Ms. Casburn “must have said she wanted to be paid” for him to have suggested that she had.

--------------------------------------------------------

http://www.dailymail.co.uk/news/article-2259079/Hacking-police-saw-inquiry-jolly-excited-meeting-Sienna-Miller-Met-detective-claims.html

Edited January 8, 2013 by Douglas Caddy

[Douglas Caddy]

Hacking: corrupt Yard officer found guilty of trying to sell information to NotW

A senior Scotland Yard counter-terrorism officer has been convicted of misconduct after she offered to sell information about the phone-hacking investigation to the News of the Worl

By Gordon Rayner, Chief Reporter

The Telegraph

2:45PM GMT 10 Jan 2013

http://www.telegraph.co.uk/news/uknews/phone-hacking/9793372/Hacking-corrupt-Yard-officer-found-guilty-of-trying-to-sell-information-to-NotW.html

Detective Chief Inspector April Casburn, 53, tried to undermine the inquiry “at the point of its launch” by phoning the newspaper whose former journalists were under suspicion.

She claimed that she had made the call because she felt the public should be told that counter-terrorism officers were being seconded to the hacking inquiry instead of “saving lives”.

But a jury at Southwark Crown Court unanimously decided today that Casburn, a mother of three, was motivated by greed.

She was found guilty of misconduct in public office. Casburn, who has a three-year-old adopted child, will be sentenced at a later date.

Mr Justice Fulford told her she faces a custodial sentence. The maximum term is life imprisonment.

He said: "The defendant must understand that given the jury's verdict I must have in mind an immediate custodial sentence."

He wishes to hear from the social worker of her child, adopted in 2011, before sentencing.

Speaking afterwards, Detective Chief Inspector Gordon Briggs, who is overall charge of Operations Weeting, Elveden and Tuleta, said: "It is a great disappointment that a detective chief inspector in counter-terrorism command should have abused her position in this way. There is no place for corrupt officers or staff in the Metropolitan Police Service. We hope this prosecution demonstrates that.

"Leaking or in this case trying to sell confidential information to journalists for personal gain will not be tolerated.

"There may be occasions where putting certain information into the public domain - so-called whistle-blowing - can be justified; this was not one of them.

"In this case, DCI Casburn proactively approached the News of the World, the very newspaper being investigated, to make money. She betrayed the service, and let down her colleagues, the hardworking, honest police officers, who make up the vast majority of the Met.

"Fortunately, this type of behaviour is rare but we hope today's verdict shows the public can have confidence that the MPS holds itself to account."

During her trial the jury had been told that Casburn called the News of the World on Sep 11, 2010, and told a reporter that Andy Coulson, the former editor of the News of the World and the then director of communications at Downing Street, was one of four people under investigation.

A memo about the conversation which the reporter emailed to his boss said the officer wanted to “sell us inside info” about the hacking investigation.

She had been told the previous day that officers from counter-terrorism command would be seconded to a new phone-hacking inquiry launched as a result of an article in the New York Times which alleged that hacking was more widespread than the one reporter and one private detective jailed in 2007.

Prosecutor Mark Bryant-Heron had earlier told Southwark Crown Court that DCI Casburn was in charge of the National Terrorist Financial Investigation Unit within the Yard’s SO15 counter-terrorism command at the time of the alleged offence.

At 7.51am on September 11, 2010, she rang the News of the World newsdesk and spoke to a reporter called Tim Wood.

Mr Bryant-Heron said Mr Wood “offered to sell information to the News of the World” about Operation Varek, a review of a 2006 investigation into phone-hacking which had been launched by Assistant Commissioner John Yates as a result of allegations made in an article in the New York Times.

"The defendant provided information relating to the allocation of resources for Operation Varek,” said Mr Bryant-Heron. “She identified a number of suspects and gave the names of two of the people under investigation.

“She spoke of the difficulty of proving the crimes alleged, and she sought to undermine a high-profile and highly-sensitive investigation at the point of its launch...she sought for reasons of her own to undermine an investigation by giving information to the very newspaper that was concerned in the investigation.”

[Douglas Caddy]

Weekend Edition January 18-20, 2013

www.counterpunch.org

Rupert's Misdeeds

American Media Ignore Major Murdoch News Corp Scandal

by LINN WASHINGTON JR.

America’s corporate news media love highlighting David-besting-Goliath stories…except apparently, when the fallen Goliath is major media mogul Rupert Murdoch – the billionaire owner of America’s caustic FOX News and other entities.

Arguably the biggest Goliath slaying story in the world during the past two years involved the unraveling of Murdoch’s news empire in England, where he exerted extraordinary influence over top British governmental officials from police to Parliament and even into that nation’s Prime Minister’s Office.

But disturbing documentation of wrongdoing by Murdoch minions, such as illegal hacking into telephones, arrests of top Murdoch executives and a scathing report from Parliament, elicited little sustained interest from America’s mainstream media into what is known variously as the ‘Murdoch Scandal’ and ‘England’s Watergate.” This despite the fact that Murdoch’s News Corp is also a huge enterprise in the US.

Even when one of the journalists who exposed America’s 1970s-era Watergate Scandal – Bob Woodward – broke a story in early December 2012 about a scheme by Murdoch to seize control of the US presidency, America’s news media continued focusing on celebrity fluff and the looming ‘Fiscal Cliff.’

Woodward exposed a covert effort by Murdoch and his FOX News head, Roger Ailes, to recruit General David Petraeus as a 2012 presidential candidate complete with pledges to bankroll a Petraeus campaign, plus providing on-air support from FOX News – an offer Petraeus declined.

“The Murdoch story – his corruption of essential democratic institutions on both sides of the Atlantic – is one of the most important and far reaching political/cultural stories of the past 30-years,” wrote Woodward’s Watergate reporting partner Carl Bernstein in a December commentary published in London’s Guardian newspaper. Bernstein blasted the U.S. media for ignoring Woodward’s exposé.

Although still reeling from scandals in England, Murdoch continues his efforts in the U.S. to win rule changes from the Federal Communications Commission (FCC) that would permit him to expand his News Corp media empire here through increased monopoly ownership.

Given the criminality explicit in the British Murdoch scandal and 24/7 FOX News savaging of U.S. President Barack Obama, why would the Obama Administration consider relaxing longstanding ownership rules to permit Murdoch to buy the top newspapers in Chicago and Los Angeles as he is attempting to do?

The London Guardian’s dogged go-it-alone coverage of phone hacking and other misdeeds within Murdoch’s English media empire led to that scandal’s unraveling, inclusive of Murdoch’s July 2011 closure of his beloved News of the World newspaper (then England’s largest newspaper).

The May 2012 report from a British Parliament investigative committee declared Murdoch “not a fit person to exercise the stewardship of a major international corporation.”

That report blasted the Australian Media baron (he later bought a US citizenship so he could get around the rule barring foreign ownership of TV stations in the US) for “willful blindness” to the misdeeds of his underlings, whom he kept closely under his thumb until he disavowed knowledge of their misdeeds in an effort to evade accountability.

Murdoch denies knowing about the misdeeds of his News of the World employees.

One of the arrested Murdoch employees, former newspaper executive Andy Coulson, served as the press spokesman for Britain’s Prime Minister David Cameron until January 2011, when he resigned due to mounting pressure from the evolving phone hacking scandal. Police arrested Coulson in July 2011.

Cameron hired Coulson in 2007 after Coulson left a Murdoch newspaper under a cloud of impropriety from an earlier phone hacking debacle. Coulson nonetheless reportedly secured Murdoch’s personal backing for Cameron’s successful bid for the PM position – the British equivalent of the U.S. presidency.

A key player in this epic mangling of Goliath Murdoch is a classic David figure – British lawyer Mark Lewis – whose representation of clients victimized by phone hacking and other illegal conduct within Murdoch’s English empire contributed to erection of scaffolding that eventually reached Murdoch’s corporate suite.

Lewis’ clients included the family of Milly Dowler, a teen murder victim.

Revelations that News of the World’s scandal-mongering reporters had hacked into the voicemail of the then missing Dowler – deleting voicemails so as to continue giving Dowler’s distraught parents the false impression that she was still alive – galvanized public opinion against that newspaper and eventually against Murdoch himself.

“Only twice in the past 70-years have political parties in Britain had a consensus: World War II and Milly Dowler,” asserted Lewis during a panel discussion on the Murdoch Scandal last spring at the Logan Investigative Reporting Symposium held at UC Berkeley’s Graduate School of Journalism.

That Symposium featured a screening of the insightful “Frontline” documentary “Murdoch’s Scandal.” Lowell Bergman, the lead correspondent for that documentary, is an investigative reporting professor at Berkeley’s J-School.

“The thing that surprised me the most in doing this story is the amount of control Murdoch and his News Corporation had over police and politicians,” said Neil Docherty, director/producer of that “Scandal” documentary.

“One police official who said there was nothing to investigate regarding phone hacking was later forced to resign. Then he became a columnist for a Murdoch newspaper,” said Docherty.

That collusion between Murdoch employees and top officials of London’s Metropolitan Police represents one of the seamier undersides of this serial misconduct, said lawyer Mark Lewis during a TCBH interview.

“Murdoch bought police with wine and football [soccer in England] tickets,” said Lewis. “The big issue is that corruption in the Met came from top to bottom not bottom to top. Police corruption is a huge program in England.”

The cozy relationship between Murdoch’s media empire and the Metropolitan Police dates from a major mid-1980s labor dispute between newspaper unions and Murdoch, where strikers contend police brutalized them.

Collusive behaviors, according to a special union report published in the fall of 2011, included News of the World reporters setting up people to commit crimes and then police “would arrive to nab the culprits, usually on a Saturday afternoon, giving the paper its Sunday scoop and the police their arrest.”

John Pilger, a journalist who, like Murdoch, hails from Australia, contends phone hacking and influence peddling are not Murdoch’s most atrocious misdeeds. “The most enduring and insidious Murdoch campaign has been against the Aboriginal people,” Pilger wrote a few years ago. FOX News in America is often lambasted for race-baiting against blacks and Hispanics.

Thinking that the British Murdoch scandal in particular or media ownership in general is no big deal as long as the media provides weather, traffic, some headline news and/or favored songs/shows ignores the reality that what people hear and see in the media all too often becomes what they believe.

The FOX News Channel – the preeminent purveyors of malicious right-wing partisanship (a/k/a propaganda) and utter misinformation in America – is a prime example.

A survey released in November 2012 by researchers at New Jersey’s Fairleigh Dickinson University documented that people who only watch FOX News are less informed about facts than all other news consumers — and that’s starting from an pretty low bar. The findings of this survey mirror previous findings about ill-informed FOX News viewers.

If there is any consolation to the timid treatment of Murdoch’s misdeeds by U.S. mainstream media it is that they are following in the footsteps of British media.

“The press in England was afraid of the phone hacking scandal because they were scared of Murdoch’s power to attack them,” said lawyer Mark Lewis, who was himself the target of threats and dirty-tricks by Murdoch corporate operatives.

“Murdoch’s attacks on politicians through his newspapers pushed whole areas of policy off of public discussions.”

LINN WASHINGTON, JR. is a founding member of ThisCantBeHappening!, the new independent Project Censored Award-winning online alternative newspaper. His work, and that of colleagues JOHN GRANT, DAVE LINDORFF, LORI SPENCER and CHARLES M. YOUNG, can be found at www.thiscantbehappening.net