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Category: James Murdoch

Despite Murdoch furor, BSkyB says it is a 'fit and proper' broadcaster

British Sky Broadcasting insisted that it remains a "fit and proper" holder of a broadcasting license in Britain, despite a damning parliamentary report on media baron Rupert Murdoch, whose News Corp. owns a controlling stake in the company
LONDON -- British Sky Broadcasting insisted Wednesday that it remains a "fit and proper" holder of a broadcasting license in Britain, despite a damning parliamentary report on media baron Rupert Murdoch, whose News Corp. owns a controlling stake in the company.

In an earnings report, the lucrative satellite television service said it was cooperating with British regulator Ofcom as part of the agency's evaluation of whether BSkyB remains a suitable holder of a broadcasting license.

The company said its "positive contribution to U.K. audiences, employment and the broader economy, as well as its strong record of regulatory compliance and high standards of governance" qualified it to maintain its license.

The statement came a day after an excoriating report by a parliamentary committee branded Murdoch as "not fit" to run a major international company. The report accused three senior News Corp. executives of lying to the panel during its investigation into phone hacking by the News of the World.

Murdoch shut down the tabloid last summer at the height of public outrage over phone hacking, which now appears to have been common practice at the paper. The furor also forced Murdoch to abandon his bid to buy the 61% of BSkyB that News Corp. does not already own.

The head of BSkyB sought to put some distance between his company and Murdoch's on Wednesday.

"It's important to remember that Sky and News Corp. are separate companies," Chief Executive Jeremy Darroch told reporters. "We believe that Sky's track record as a broadcaster is the most important factor in determining our fitness to hold a license. And the evidence shows that Sky serves U.K. audiences and customers well."

BSkyB reported a 5% rise in revenue over the last nine months, compared with same period a year earlier. Its adjusted operating profit during that period exceeded $1.4 billion, a 15% increase.

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Photo: Media magnate Rupert Murdoch and son James attend a horse race in Britain in March 2010. Credit: Adrian Dennis / AFP/Getty Images

Rupert Murdoch unfit to lead company, British lawmakers say

Rupert Murdoch “exhibited willful blindness” toward the illegal phone hacking that was rife at the News of the World tabloid and is “not a fit person” to head a major international company such as News Corp., a panel of British lawmakers said in a stinging report
This post has been corrected. See the note below for details.

LONDON -- Rupert Murdoch "exhibited willful blindness" toward the illegal phone hacking that was rife at the News of the World tabloid and is "not a fit person" to head a major international company such as News Corp., a panel of British lawmakers said in a stinging report Tuesday.

Murdoch's son, James. also showed poor leadership in failing to get to the bottom of the hacking scandal, but neither he nor his father lied to Parliament about their knowledge of the extent of the problem, the report said.

However, three other senior executives at News Corp. and the now-defunct News of the World -– including Les Hinton, one of Rupert Murdoch’s closest associates -– did mislead Parliament about how widespread the practice of snooping into cellphones was, the report said.

And as a whole, News International, News Corp.'s British arm, deliberately tried to hide the problem by suppressing documents and making statements to Parliament that were not fully truthful, according to the report.

"Their instinct throughout, until it was too late, was to cover up rather than seek out wrongdoing and discipline the perpetrators," the report said.

The scathing report by Parliament's committee on the media comes a week after Rupert and James Murdoch testified here before a judicial inquiry into media ethics. The report, months in the making, is certain to add pressure on the Murdochs as their global media empire struggles to deal with the continued fallout from the hacking scandal.

In particular, the report's most controversial statement, that Rupert Murdoch is unfit to lead an international company, could imperil News Corp.'s nearly 40% stake in the television company British Sky Broadcasting. British regulatory authorities are charged with determining whether major stakeholders such as Murdoch are "fit and proper" owners of mass media in Britain.

The committee's finding on Murdoch's unfitness was not unanimous. In fact, it led to a bitter split along party lines, with four Conservative Party members refusing to endorse the report on the grounds that such a declaration was outside the scope of the panel's investigation.

The report was approved on a 6-4 vote.

Committee members stressed they were completely agreed on their finding that three of Murdoch’s senior executives essentially lied to Parliament about phone hacking, which News International insisted for years was confined to one "rogue reporter."

One of those executives, Colin Myler, is now the editor of the New York Daily News.

Though misleading Parliament is a serious offense, it is unclear what punishment can actually be applied.

The committee called it "astonishing" that Rupert and James Murdoch took so long to find out that phone hacking went far beyond a lone reporter. Police say that thousands of people may have had their phones hacked into by the News of the World in its pursuit of sensational stories.

The scandal exploded in the public consciousness last summer with the revelation that among the hacking victims was a 13-year-old girl who was kidnapped and later found slain.

[For the Record, 11:41 a.m., May 1: A previous version of this post stated that the New York Daily News was owned by Rupert Murdoch's News Corp. The New York Post is owned by the company.]

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Photo: Media tycoon Rupert Murdoch leaves from a London courthouse last week after testifying at a British judicial inquiry on media ethics. Credit: Justin Tallis / AFP/Getty Images

News Corp.'s relations with British politicians, regulators questioned

Details of contact between News Corp. executives, including James Murdoch, Rupert's son and the company's deputy chief operating officer, emerged during a judge-led inquiry into press ethics prompted by the scandal at the media giant's tabloid newspapers
LONDON -- Part of being a media mogul is schmoozing with politicians and regulators who have oversight over the industry, but there is a fine line between lobbying for your business and inappropriate contact. Now Rupert Murdoch's News Corp. is being accused of crossing that line when it was attempting to take over British Sky Broadcasting.

Details of contact between News Corp. executives, including James Murdoch, Rupert's son and the company's deputy chief operating officer, emerged Tuesday during a judge-led inquiry into press ethics prompted by the scandal at the media giant's tabloid newspapers. Operatives for News Corp. papers, including the now-closed News of the World, have been accused of hacking into voice mails and paying off police for stories.

At issue are News Corp.'s interactions with Jeremy Hunt, the secretary of media and culture who had oversight over News Corp.'s proposed deal to buy the 61% of BSkyB it didn't already own. News Corp. withdrew that bid after the phone-hacking scandal exploded and put a dark cloud over the company.

During Tuesday's hearing, James Murdoch denied implications that News Corp. engaged in improper discussions with Hunt while seeking approval of the deal, and bristled at the idea that the company would use its media clout to persuade politicians to advance its corporate agenda.

"The question of support of an individual newspaper for politicians one way or another is not something that I would ever link to a commercial transaction like this," Murdoch said. "Nor would I expect ... political support one way or another ever to translate into a minister behaving in an inappropriate way -– ever. I simply wouldn’t do business that way."

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Photo: James Murdoch: Credit: Matthew Lloyd / Bloomberg

James Murdoch insists he was unaware of widespread phone-hacking

 

James Murdoch, the son of media titan Rupert Murdoch, testified that he had no idea phone hacking was widespread at the News of the World tabloid and that he would have insisted the company "get to the bottom of what was going on" had he known
LONDON -- James Murdoch, the son of media titan Rupert Murdoch, testified Tuesday that he had no idea phone hacking was widespread at the News of the World tabloid and that he would have insisted the company "get to the bottom of what was going on" had he known.

In a London courtroom, Murdoch said he had been assured by underlings that hacking was confined to a "rogue reporter" who was jailed in 2007 for tapping into voicemails left for members of Britain's royal household. Murdoch said he was told that the hacking issue had been safely "packed away" by the time he took control of News International, the British arm of media giant News Corp.

"I was given repeated assurances ... that the newsroom had been investigated, that there was no evidence" of more hacking, Murdoch said at the beginning of his highly anticipated appearance before a judge-led inquiry into media ethics here.

The inquiry was set up last summer after the hacking scandal broke wide open with the revelation that the News of the World had illegally accessed the voicemails left on the phone of a kidnapped teenager. The girl, 13-year-old Milly Dowler, was later found slain.

Police now say the now-defunct News of the World pried into the private voicemails of potentially hundreds of people, including actors, athletes, politicians and family members of murder victims and fallen soldiers.

In his sworn testimony, Murdoch insisted he would have "cut out the cancer" of hacking if he had known that the practice went beyond a single reporter to encompass other journalists at the News of the World. He denied that he was part of a corporate cover-up, but also rejected a suggestion that he was guilty of poor management for not knowing what was going on at one of his newspapers.

The paper's editor and its legal manager were responsible for making sure employees complied with ethical standards, Murdoch said. He also did not participate in editorial decisions, he said.

"I wasn't in the business of deciding what to put in the newspapers," Murdoch testified.

Both Rupert and James Murdoch were called before a parliamentary committee to answer questions on the hacking scandal last July.

Scotland Yard is now pursuing three separate investigations into voicemail interception, computer hacking and payoffs of police and public officials for information.

Dozens of journalists from the News of the World and its sister tabloid, the Sun, have been arrested in connection with the various probes. Britain's chief prosecutor is considering whether to file formal charges against 11 of them.

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James Murdoch resigns from BSkyB ahead of phone-hacking report

-- Henry Chu

Photo: James Murdoch gives testimony in London on Tuesday before a judge-led inquiry into media ethics. Credit: AFP/Getty Images

James Murdoch resigns from BSkyB ahead of phone-hacking report

 

James Murdoch's resignation as chairman of satellite broadcaster British Sky Broadcasting comes ahead of what is expected to be a very critical government report on his handling of the ethics scandal at News Corp.'s British tabloids.

Murdoch, in announcing his decision, alluded to the ongoing investigations into accusations of phone hacking and payoffs to police, allegedly by the News Corp.'s News of the World and the Sun. News Corp. owns 39% of BSkyB and was on track to acquire the rest of the company last year until the problems at the tabloids derailed the deal. Murdoch resigned in February as executive chairman of News International, the media conglomerate's British publishing division.

"As attention continues to be paid to past events at News International, I am determined that the interests of BSkyB should not be undermined by matters outside the scope of this company," Murdoch said in a statement released Tuesday. "I am aware that my role as chairman could become a lightning rod for BSkyB and I believe that my resignation will help to ensure that there is no false conflation with events at a separate organization." Murdoch will remain on BSkyB's board of directors.

Murdoch, the youngest son of News Corp. Chairman and Chief Executive Rupert Murdoch, has been the focus of scrutiny over his handling of the crisis as head of News International. Last December he informed Parliament that he did not read an email from senior executives saying that the practice of phone hacking -- listening in on voice-mail messages left for celebrities, members of the royal family and even crime victims -- could be widespread. 

More than a dozen journalists and executives with News International have been arrested and questioned by Scotland Yard in connection with its investigation into the allegations of phone hacking and bribery. Police are also probing whether News International was engaged in a cover-up of criminal activity at News of the World and its sister tabloid, the Sun.

James Murdoch, who served as chairman of News International until stepping down from that post in February, has consistently denied any knowledge of widespread phone hacking at the papers then under his command. He insists he was led to believe that phone hacking was confined to one "rogue reporter" at the News of the World who was convicted and jailed for his offense.

James and Rupert Murdoch are expected to appear before Parliament again as part of an ongoing inquiry into possibly illegal activities at the tabloids. The damaging scandal exploded last summer when the Guardian reported that News of the World operatives had eavesdropped on voice-mail messages left for a missing teen girl who was later found murdered.

Murdoch's resignation as chairman of BSkyB does not mean the powerful broadcaster won't suffer collateral damage from the probe into the newspapers. British regulators may investigate whether News Corp.'s tabloid troubles have made it unfit to be part of BSkyB. Nicholas Ferguson, currently the deputy chairman, will succeed Murdoch as chairman of BSkyB.

Once seen as the heir to his father's kingdom, James Murdoch has been severely tarnished by the controversy, although he still holds a senior position at News Corp. as its deputy chief operating officer and focuses on its international television business.

"The story continues to not go away, and the feeling that somehow James was involved to a greater extent than he's willing to let on continues to persist," said Doug Creutz, media analyst with Cowen and Co. "He keeps falling back further and further backwards along the line of defenses in terms of his involvement in the Murdoch empire. There ain't a lot left."

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James Murdoch received email warning of phone hacking 'nightmare scenario'

JamesMurdochNewsCorp.

News Corp. Deputy Chief Operating Officer James Murdoch received an email in June 2008 that described the company's tenuous legal position because of the widespread nature of phone hacking by operatives of its now-defunct News of the World tabloid.

The internal emails, which were released Tuesday by the British Parliament's Culture, Media and Sport Committee, are important because they appear to belie Murdoch's statements to Parliament that he was unaware that illegal conduct involved numerous News of the World reporters as well as a private investigator hired by the tabloid. 

Murdoch consistently has insisted to Parliament that he did not learn until late 2010 of the widespread nature of the phone hacking. However, the emails lay out an exchange more than two years earlier between Murdoch, the 38-year-old son of media baron Rupert Murdoch, and Colin Myler, the former editor of the tabloid. 

"Unfortunately it is as bad as we feared," Myler wrote to James Murdoch in a June 7, 2008, email. 

The correspondence included another email, this one from the paper's in-house lawyer, which said News International -- the British newspaper unit of News Corp. -- would have to pay a soccer league executive Gordon Taylor about $1 million to settle invasion of privacy charges. The second email warned of a "nightmare scenario" because a second soccer league official, Joanne Armstrong, also had been targeted in the phone hacking.

Murdoch, in a separate letter submitted to Parliament this week, stated that he only became aware of the email chain last week. He noted that the 2008 emails had been sent to him on a Saturday afternoon, and that he failed to fully read them.

"I typically received emails on my BlackBerry on weekends. I am confident that I did not review the full email chain at the time or afterwards," Murdoch wrote to the head of the Parliament committee. "I would like to take this opportunity to reaffirm my past testimony that I was not aware of evidence that either pointed to widespread wrongdoing or indicated that further investigation was necessary."

News Corp. on Tuesday declined further comment.

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Photo: News Corp. Deputy Chief Operating Officer James Murdoch pictured in London last month. Credit: Oli Scarff / Getty Images

 

James Murdoch survives BSkyB vote despite dissent

Despite the taint of the persistent British phone-hacking scandal, James Murdoch on Tuesday was reelected as chairman of the powerful British Sky Broadcasting television service

Despite the taint of the persistent British phone-hacking scandal, James Murdoch on Tuesday was reelected as chairman of the powerful British Sky Broadcasting television service.

The youngest son of Rupert Murdoch received the support of 81.2% of votes cast in Tuesday's election. Nearly 19% of shareholders voted against him. James Murdoch, 38, also is deputy chief operating officer of News Corp., which owns 39% of the BSkyB shares, and has been considered the likely heir to his father's media empire. 

Stripping out the votes held by News Corp., James Murdoch received far less support. Slightly more than 55% of the independent shareholders voted for his retention on the board. Nearly 32% opposed his continued tenure, and the remaining 12.9% withheld their votes.

In October, James Murdoch survived a vote of no confidence during the annual meeting of News Corp. investors. At that time, he retained his position as a director in the New York-based media giant. However, he faces continued hearings in the British Parliament concerning his oversight of News Corp.'s U.K.-based newspaper division, and his handling of the phone-hacking scandal that led to the shuttering of News of the World tabloid. 

In July, fallout from the scandal forced News Corp. to withdraw its $12-billion bid to buy out the remaining shares of BSkyB. James Murdoch on Tuesday reaffirmed News Corp.'s continued role as a long-term shareholder in the television service.

In his statement to shareholders, he also said that BSkyB passed its long-term target of 10 million TV customers last year. "This is a significant achievement," he said.  "But more important than any single target is the way that our business has been transformed through constant appetite for change and a strong culture of continuous improvement."

The vote results were reported by RNS, a news service of the London Stock Exchange.

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Photo: James Murdoch leaves Tuesday's annual meeting of British Sky Broadcasting shareholders in London. Credit:  Gareth Fuller / Associated Press

James Murdoch leaves boards of British newspapers' parent firms

Jamesmurdoch3Story
News Corp.'s chief operating officer, James Murdoch, has resigned from the boards of the companies that operate the British newspapers the Sun and the Times.

Murdoch remains chairman of News International, the division that controls News Corp. publishing operations in Britain. However, he turned over day-to-day operations of the group to Tom Mockridge, who was named chief executive following the resignation this summer of former New International chief executive and News of the World editor Rebekah Brooks.

The 38-year-old Murdoch, son of powerful News Corp. Chairman Rupert Murdoch, stepped down in September as a director of Times Newspapers, which publishes the Times and the Sunday Times, and of News Group Newspapers, which owns the Sun tabloid and formerly published the now-defunct News of the World, which is at the center of the British phone-hacking scandal.

A person familiar with the matter described these units as holding companies that exist primarily for accounting purposes. The change comes as James Murdoch prepares to move to New York, as was announced in March with his elevation to the No. 3 News Corp. job.

"Following the appointment of Tom Mockridge as CEO of News International, in September James Murdoch stepped down from the boards of a number of News International subsidiary companies, including News Group Newspapers and Times International newspapers," the company said in a statement Wednesday. "He remains chairman of News International Group and director of Times Newspapers Holdings, the holding company of the Times Newspapers."

The development comes against the backdrop of a parliamentary investigation into allegations that the News of the World and other newspapers hacked phone messages left for members of the royal family, celebrities and crime victims in pursuit of salacious scoops. Murdoch has been called twice by the committee investigating the matter to answer questions about what he knew of the illicit conduct.

The controversy has sparked calls for press reforms in Britain from, among others, actor and phone-hacking victim Hugh Grant.

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Photo: James Murdoch looks on during the Digital Life Design conference on January 25, 2011 in Munich, Germany. Credit: Miguel Villagran / Getty Images.

Close associate of James Murdoch steps down at News Corp.

James Murdoch

A close associate of embattled executive James Murdoch will step down from her high-level position as chief human resources officer of News Corp. at the end of the month. 

The company said Beryl Cook would be replaced by longtime corporate consultant Jeff Mook.

The move is significant because Cook was seen within News Corp. as a key member of James Murdoch's "shadow government" as he began to amass power within the global media conglomerate and was being groomed as a successor to his father, Rupert Murdoch. The elder Murdoch is chairman and chief executive at News Corp., and James serves as deputy chief operating officer.

Cook had worked with James Murdoch at British Sky Broadcasting in London, when he ran the satellite TV service. In 2007, she moved to News Corp.'s New York headquarters to assume her senior post.

That same year James Murdoch was elevated to head of News Corp.'s European and Asian operations. In March, he was promoted to his current job, a New York-based position. Since July, he has been embroiled in the phone hacking scandal that has shaken the media company and the British political establishment.

James Murdoch is being recalled to appear before British Parliament next Thursday to face a second round of questions over his role in the controversy.

Cook, a former journalist and 22-year veteran of the company, is not leaving News Corp. entirely. After a month-long transition, she will return to an Asian Pacific division "to be closer to her family," News Corp. said.

“I understand her decision to leave New York and am delighted she has agreed to continue playing an important role within the company," Rupert Murdoch said in a statement.

Mook, 50, joined News Corp. in early 2010 as the company’s senior vice president of global compensation. He spent 25 years as a consultant for such firms as Towers Perrin. He will report to Chase Carey, News Corp.'s president and chief operating officer.

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Photo of News Corp. Deputy Chief Operating Officer James Murdoch. Credit: David Moir/ Reuters

News Corp. shareholders vote heavily against Rupert Murdoch's sons

 

James Rupert Murdoch
In a challenge to Rupert Murdoch’s family succession plans, more than one-third of votes cast by News Corp. shareholders were opposed to returning the media mogul's two sons, James and Lachlan, to the board. 

The company's 80-year-old chairman and chief executive fared much better -- winning the backing of an overwhelming majority of the votes cast in Friday's election, according to a document filed late Monday with the Securities and Exchange Commission.

Rupert Murdoch collected 86% of the votes cast, although a sizable number of shareholders, representing 12 million votes, abstained. All the company's directors, including the three Murdochs, won a majority of the votes cast -- an outcome nearly assured because Murdoch and his family control 40% of the voting shares.

Still, shareholders signaled their unhappiness with the Murdoch family. The elder Murdoch has long indicated that he would like one of his children to succeed him in running the $33-billion-a-year  media conglomerate, which owns the Fox television network, Fox News Channel, 20th Century Fox film studio, HarperCollins publishing and a stable of newspapers including the Wall Street Journal.

News Corp. Deputy Chief Operating Officer James Murdoch, 38, has been considered the heir apparent. However, he has been tarnished by the British phone hacking scandal engulfing the company, and garnered the fewest votes of any director in the election. Thirty-five percent of the votes cast opposed his return to the board, raising questions about his future at News Corp.

Murdoch has been called to appear before Parliament on Nov. 10 for a second time to answer more questions about the extent of his knowledge of the eavesdropping debacle at the company's now-defunct News of the World tabloid. Operatives for the paper listened to voice mail messages left for members of the royal family, celebrities and crime victims.

Fresh questions about the extent of James Murdoch’s knowledge about the illicit reporting practices employed by the London tabloid's journalists arose after two former News Corp. employees contradicted statements he made this summer to a committee of Parliament.

Murdoch's 40-year-old son, Lachlan, fared only slightly better than his brother. Thirty-four percent of the votes cast opposed his return to the board.  He left the company's management in 2005 after a clash with senior executives but remains a News Corp. director.

In contrast, Chief Operating Officer Chase Carey received strong support from the company's shareholders, garnering 91% of the votes cast. Former New York city school Chancellor Joel Klein collected 96% of the votes cast.

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Photo of Rupert Murdoch, right, chairman and chief executive of News Corp., and his son James Murdoch, chief executive of News Corp. in Europe and Asia, in London. Credit: Facundo Arrizabalaga/European Pressphoto Agency.

 

 

 

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