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In the Heavyweight Championship Fight that is Rupert Murdoch’s Tabloid Stratagem Vs. Rupert Murdoch’s Business Strategem, It’s the Middle Rounds, and the Tabloid Hack Attack Has the Business BSkyB Plan on the Ropes. But the Fight is Far From Over

Jul 11, 2011  •  Post A Comment

It’s Rupert Murdoch vs. Rupert Murdoch in the fight of his life, and he’d probably have it no other way.

The Independent in the U.K. is reporting today, Monday, July 11, 2011, that "Rupert Murdoch’s takeover of BSkyB appeared to be dead in the water last night after proof emerged that executives at his British newspaper empire mounted a cover-up of the full scale of alleged criminal wrongdoing at the News of the World. In another extraordinary day in the phone-hacking scandal, Downing Street sources confirmed that Government lawyers were drawing up a strategy to halt the £9bn [$14 billion] deal which looked a certainty only a week ago."

That comes on the heels of a report at Deadline.com last Friday, July 8, 2011 that "Ofcom, the UK communications regulator, says it has concerns as to whether News Corp is a fit-and-proper owner for BSkyB in light of the worsening News of the World scandal. James Murdoch has admitted News International effectively misled the UK Parliament while he approved secret out-of-court settlements for illegal activity."

The Deadline story adds, "even Prime Minister David Cameron has distanced himself from his friend Rebekah Brooks — the CEO of newspaper arm News International, who was editor of News of the World when the alleged phone hacking of murdered schoolgirl Milly Dowler and families of London bombing victims took place. At an emergency press conference this morning, Cameron said that if Rebekah Brooks offered her resignation to him, he would have taken it. Brooks again addressed News of the World staff this afternoon, although she has not resigned."

As previously reported, News Corp. shut down the 168 year-old News of the World newspaper after yesterday’s (Sunday’s) edition, because of the ever-widening phone-hacking scandal at the newspaper. The idea is to–ultimately–win British government approval of the BSkyB deal.

The New York Times today has two good stories related to the scandal. One of the stories details the "Cozy Ties [that] Mark Newspaper’s Dealings With Scotland Yard," as the headline of the article says.

The other New York Times story is media columnist David Carr’s "A Tabloid Shame, Exposed by Earnest Rivals,"

In that piece Carr writes, " ‘After [U.K. Prime Minister]  David Cameron was elected prime minister, one of the first visitors he received at 10 Downing Street was Mr. Murdoch — discreetly through a back entrance — and Mr. Cameron spoke plainly last week about the corrosively close relationship. ‘The truth is, we’ve all been in this together,’ he said. ‘The press, the politicians and leaders of all parties.’ To which a dumb Yank like me might say, ‘Duh.’ "

Carr adds later in his piece, "James Murdoch regretted everything and took responsibility for almost nothing. What looked like an opportunity for him to prove his mettle as a manager of crisis might yet engulf him. Andy Coulson, the former editor of News of the World who became the chief spokesman for Mr. Cameron, has been arrested. And Rebekah Brooks, chief executive of News International and previous editor of The News of the World, responded by saying that it was ‘inconceivable’ that she knew of the hacking."

Carr then writes, "I’d suggest it was inconceivable she did not know, given the number of hacking targets. What editor doesn’t know where her stories come from, especially stories chock full of highly private, delicious conversations. Did Ms. Brooks think they were borne in through the window by magic fairies?"

In The New Yorker last week, longtime Rupert Murdoch watcher Ken Auletta wrote, "Rupert Murdoch is a brilliant, daring business executive. He is, sadly, a man whose newspapers too often traffic in sleaze. That is the culture he built and that his minions immersed themselves in. Even taking the dramatic step of closing the News of the World will not, I suspect, tame the controversy and allow News Corp. to deflect blame. The phone-hacking scandal is one Murdoch cannot escape, because he is culpable."

Despite all of the current negative publicity News Corp. is getting because of the scandal, it is far from clear that, ultimately, Rupert Murdoch will be unsuccessful in his goal of taking over the rest of BSkyB that News Corp. does not currently own.

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