News Corp plans to do some heavy duty spinning this week. The board meets tomorrow for the first time since the UK phone hacking and police bribery scandals broke open in early July — a prelude to Wednesday when News Corp releases its earnings for the quarter that ended in June. And The Wall Street Journal says directors will look for ways to persuade investors to focus on company operations instead of the scandals. One possibility: Giving shareholders some of the $12B in cash that’s no longer needed to buy BSkyB. That could be done by raising the dividend or announcing a big stock repurchase. But the company still has to figure out how to deal with Rupert Murdoch’s News Of The World mess — and that’s why all eyes this week will be on Viet Dinh: He’s the independent director who’s overseeing the company’s investigation into what happened, and will brief the board tomorrow. But how independent is he? Turns out his ties to the Murdoch family are so close that it’s questionable whether he can be objective about the matter a Bloomberg profile this morning shows. Dihn is a godfather to one of Lachlan Murdoch’s kids. A Murdoch owned paper, The South China Morning Post, also helped Dihn free his sister from a refugee camp in Hong Kong for Vietmanese boat people. Bloomberg says Dihn’s law firm, Bancroft Pllc., “advises corporate boards, board members and executives with ‘high-stakes’ problems” and describes it as “the go-to firm for conservatives.”


With each new story about this…the number of comments keeps dwindling done to almost nothing. The public has grown weary and is waiting for the next scandal to break.
The residual effects on News Corp are yet to be realized, and this may take some time to come to any final resolution. So, giving the stockholders a ‘stimulus’ may ease the short term pain…while only slowing down the long term impact which may still hit the company.
For sure, globally the perception is Rupert is Darth Vader and News Corp is the evil empire under his command. That image will take quite some time to alter… if possible.
And, in this case…perception is reality.
News Corp. is fiddling while its own Rome is slowly burning. There are at least three major investigations underway in the UK and the FBI is doing its thing in the U.S. If the house is rotten then, sure, give away whatever cash you have so the residents can buy new flatscreen TVs or whatever, it’s still going to have to be torn down.
Hustlers of the world beware,
there is one mark you cannot beat:
The Mark Inside.
Scandals, well, and well not.
News Corp issues, might fizzle out in two months.
Politics, and perceptions, they change as well.