After ankling many of his European board seats in the wake of the phone-hacking scandal at News Corp’s UK press arm, James Murdoch has been elected Chairman of the supervisory board of Sky Deutschland. The exec, and son of Rupert, had originally been appointed as a member of Sky Deutschland’s board last April as News Corp began to raise his profile. The German pay-TV group is 54.8% owned by 21st Century Fox, of which Murdoch is Deputy Chief Operating Officer, Chairman and CEO, International. Via the board chairmanship that begins tomorrow, Murdoch is replacing 21st Century Fox President and COO Chase Carey who had been chairman since July 2010. Carey will remain a member of the board. “Mr. Murdoch has built a track record of bringing innovation to the global television business and choice to customers across Europe and Asia,” Sky Deutschland said today.
News Corp. has been raising the profile of deputy COO James Murdoch of late with the exec making two appearances before investors last month. Is News Corp. also looking to rebuild his coterie of board seats? Germany’s Sky Deutschland plans to appoint Murdoch as a member of its supervisory board, according to Reuters. The pay-TV group, a source told the news agency, expects to benefit from Murdoch’s international market and new technology savvy. Amid the phone-hakcing and bribery scandals at News Corp.’s UK press division last year, Murdoch left chairmanships at News International and at pay-TV group BSkyB, which News Corp. controls via its 39% stake. He also ankled the boards of Sotheby’s, GlaxoSmithKline and News Corp.’s UK print operations. But, he retained his board seat at BSkyB. News Corp. owns 54.8% of Sky Deutschland and if Murdoch does join the company board, he would be surrounded by News Corp. execs. COO Chase Carey, 20th Century Fox Television Distribution president Mark Kaner, News International CEO Thomas Mockridge and Europe & Asia COO Jan Koeppen are all members.
Looks like News Corp’s trying to boost the Deputy COO’s profile on Wall Street: James Murdoch’s appearance today at the Morgan Stanley Technology, Media and Telecom Conference was his second high-profile presentation to investors this month. (He was also on News Corp’s latest earnings call.) Rupert’s son, who last year had to defend himself against allegations that he was at least partly responsible for News Corp’s UK hacking and bribery scandals, seemed to relish the largely friendly questions about the company’s plans. He assured the audience that the company won’t go overboard in buying rights to sports programming amid reports that News Corp plans to create a national sports network. “It’s important to have a portfolio of rights where you can walk away,” Murdoch says. For example, the Los Angeles Dodgers wanted payments that were “too rich for us,” leading the team to create its own regional sports channel.
UPDATE, 5:15 AM: James Murdoch has been re-elected as a non-executive director of BSkyB. Murdoch won more support at today’s shareholder meeting in London than he had at the last one when he was still chairman of the pay-TV group. Although some investors opposed his retaining a seat, only 4.98% of proxy voters wanted him out this year compared to 19% last year. One shareholder, alluding to the troubles at News Corp.’s UK newspapers, asked if the name Murdoch is now “toxic,” but chairman Nicholas Ferguson replied there had been no negative impact on company business.
PREVIOUS, 3:19 AM: BSkyB earnings were up 16% in the fiscal first quarter on revenue of £1.715B (+4%) and operating profit of £310M (+5%). The increases came as the pay-TV giant offered new products and added 20,000 net customers to its subscriber base, for a total of about 10.7M subscribers. In response to competition in the UK streaming arena from Netflix and Amazon’s Lovefilm, BSkyB added Now TV during this quarter, a service that allows non-Sky customers to access movies on demand. It also agreed to pay £760M per season for rights to the English Premier League soccer games through 2014 (NBC just acquired rights in the States for a reported $83M per year).
Britain’s leading pay-TV group, BSkyB, reported increased revenues this summer for the year ended June 30 and a record jump in operating profit to £1.22B ($1.98B). Directors at the News Corp.-controlled company also saw increased payouts for the …
Although widely criticized for his role in the UK hacking scandal, the company is preparing to give Deputy COO James Murdoch “direct responsibility for News Corp’s U.S. television businesses,” the Financial Times reports. His mandate would include the Fox Networks Group, which includes Fox Broadcasting and cable networks FX, National Geographic, and SPEED — but not Fox News. The paper says that the head of Fox Networks Group, Peter Rice, would report to James. Rupert Murdoch‘s son lobbied for this in July when Rice landed the job, but the CEO and COO Chase Carey “resisted.” The story says its undisclosed sources have different thoughts about when the new arrangement might be announced. At least one person “close to the company” says that some execs want to wait until they know more about Scotland Yard’s investigations into phone and computer hacking, and bribery, at the company’s UK tabloid newspapers including the now-defunct News Of The World while James ran News International, the unit that runs the publications.
UPDATE: News Corp. “is pleased” with the UK regulator’s decision that BSkyB is fit to hold a broadcast license. But, the company took issue with Ofcom’s stance on former chairman James Murdoch, whose actions were called “ill-judged.” News Corp. said: “We disagree with with certain of the report’s statements about James Murdoch’s prior actions as an executive and Director, which are not at all substantiated by evidence.” (Full statement below)
PREVIOUS, 12:01 AM PT: Sky has passed the “fit and proper” test. British regulator Ofcom has concluded its months-long consideration of whether the satcaster is fit to hold a broacast license in light of phone hacking and other allegations surrounding News Corp.-controlled media properties in the UK. News Corp. owns 39% of Sky. The org today said: “There is no evidence that Sky was directly or indirectly involved in any of the wrongdoing either admitted or alleged to have taken place” at News Of The World or at The Sun. However, Ofcom was critical of James Murdoch, who stepped down as chairman of BSkyB in April this year. The org said today: “The evidence available to date does not provide a reasonable basis to find that James Murdoch… was complicit in a cover up” at the News International newspapers. But, while Murdoch was exec chairman of News International, Ofcom says it considers his conduct, “including his failure to initiate action on his own account on a number of occasions, to be both difficult to comprehend and ill-judged.”
Regarding his father, Ofcom says it does not consider the evidence currently available “provides a reasonable basis on which to conclude that Rupert Murdoch acted in a way that was inappropriate in relation to phone hacking, concealment or corruption by employees of [News Group Newspapers] or News International.” It also gave a pass to News Corp., saying it has no evidence to “reach any conclusion that News Corporation acted in a way that was inappropriate in relation to phone hacking, concealment, or corruption.”
UPDATE, 8:37 AM: David Cameron began the afternoon session at Leveson by immediately clarifying hesitant and vague comments he’d made earlier about his relationship with Rebekah Brooks. Noting that his wife keeps excellent diaries, he said he was only at his country residence, just down the road from Brooks, every six weeks in 2008 & 2009 and even less than that in 2010. Once that was handled, questioning turned to the BSKyB bid and Culture Secretary Jeremy Hunt’s role in it.
Cameron has vociferously defended Hunt, refusing to refer him to an independent probe on ministerial conduct. That’s despite revelations of a close relationship between Hunt’s and James Murdoch’s offices and his public support of the bid before being given oversight of it. When Business Secretary Vince Cable was stripped of his responsibility in the bid, after he was caught by undercover reporters saying he’d declared “war on Murdoch,” Hunt was installed to replace him. Although the affair was turned around in an afternoon, Cameron insisted, “It was not a rushed, botched decision.” It also recently came to light that on the same day, Downing Street had received legal advice that remarks made by Hunt could be seen as “prejudging the issues.” Cameron told the inquiry, “If anyone had told me that Jeremy Hunt couldn’t do the job, I wouldn’t have given him the job.”
PREVIOUS, 6:06 AM: Toeing a familiar line, UK Prime Minister David Cameron today denied he ever had an “overt” or a “covert” deal with the Murdochs in exchange for their newspapers’ support. The PM also added that he didn’t believe in “wink and nod deals” and shot down the idea that the Conservative Party and Murdoch’s UK press arm News International got together and plotted an exchange to pass News Corp’s BSkyB bid.
The morning session of the Leveson Inquiry into UK media ethichs – which Cameron himself convened last year – got off to a slow start with counsel Robert Jay lobbing softballs at the relaxed politician. Increasingly, however, Cameron appeared frustrated by questions about his relationships with the Murdochs and former News International CEO Rebekah Brooks – along with a pretty damning text message – and his hiring of former News Of The World editor Andy Coulson as his communications director.
On his relationship with Brooks, who is now facing charges of conspiracy to pervert the course of justice related to the phone-hacking scandal, Cameron was somewhat vague. The two had known each other for some time before she started dating Cameron’s Oxfordshire neighbor Charlie Brooks, but he said their relationship grew after she became engaged to and moved in with Brooks, “a few miles down the road.” When queried as to how often they saw each other, Cameron said, “It’s very difficult because I don’t have a record and I don’t want to give you an [inaccurate] answer… Sometimes quite a bit… Definitely once she started going out with Charlie… I was definitely seeing her more often. Charlie and I play tennis so… ”
On an earnings call this morning, BSkyB chief executive Jeremy Darroch said the company should be judged based on its “track record as a broadcaster.” He was addressing the issue of UK regulator Ofcom’s ongoing investigation into whether James Murdoch and News Corp are “fit and proper” persons to hold a broadcast license on behalf of BSkyB. (Murdoch stepped down as CEO of BSkyB in early April, but he remains a non-executive director.) Darroch emphasized that Sky and its largest shareholder, News Corp, are “separate companies” and said, “We think it’s our track record as a broadcaster that’s the most important in determining our fitness for a license.” He added, “It’s important to remember the broader contribution that SKY makes to the UK…We think that shouldn’t be lost in all of this.” The satcaster’s results for the 9 months ended March 31 come one day after a UK parliamentary committee said Rupert Murdoch was “not a fit person” to run an international company.
Rupert Murdoch has sent a letter to employees of News Corp following today’s release of a UK select committee’s findings on phone hacking at News Of The World. Murdoch’s note comes a week after he testified before the Leveson Inquiry into UK ethics and says in part, “We certainly should have acted more quickly and aggressively to uncover wrongdoing.” However, he adds that News Corp’s internal Management and Standards Committee has completed its review of the Times, The Sunday Times and The Sun and has found no illegal conduct “other than a single incident reported months ago, which led to the discipline of the relevant employee.” He also gives a shout-out to his embattled son, noting “News International, at the instigation of James, instituted important governance reforms.” Below is Murdoch’s full letter:
Although speculation as to its contents was in many ways on the mark, the UK government’s select committee report into phone hacking had a few surprises up its sleeve today. Neither Rupert Murdoch nor James Murdoch has been accused of misleading Parliament, but the findings are critical of both. Especially incendiary is a refrain that reads: “Rupert Murdoch is not a fit person to exercise the stewardship of a major international company.” The inclusion of the line was debated by the cross-party panel but ultimately stayed in after a 6-4 vote. In remarks following the report’s publication, lawmakers cautioned that this particular conclusion should not deflect from the report’s initial aim — namely to determine whether executives at News Corp-controlled News International misled the committee during 2009 sessions on phone hacking.
Final Phone-Hacking Report From UK Committee Divided On Rupert Murdoch, Calls Him “Unfit” To Lead Company
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UPDATE, 4:37 AM: The report is not a united one. It passed 6 votes to 4 with 3 voting against the inlcusion of a line that reads that …
British Prime Minister David Cameron appeared on BBC One program The Andrew Marr Show on Sunday where he said, “There was no grand deal” to approve News Corp’s takeover of BSkyB. Cameron told the interviewer, “I never had any inappropriate conversations with anyone about this, not least because I’d completely recused myself, taken myself out of any decision making about this important deal.” Cameron was answering a question with regard to James Murdoch’s testimony before the Leveson Inquiry into UK media ethics last week. Murdoch had said Cameron didn’t speak with him about the BSkyB bid at a dinner in December of 2010, except to say he regretted the behavior of Business Secretary Vince Cable. Cable had just been stripped of his responsibilities in overseeing questions about the bid when he told undercover reporters he had declared “war on Murdoch.” Cameron added “Let’s be frank. The thing that people are asking is was there some big deal, some big agreement between me and Rupert Murdoch, me and James Murdoch, that in return for their support of the Conservative Party that I would somehow help their business interests or allow this merger to go through? I mean that is not true.”
Turning to the text and email correspondence that was revealed during last week’s Leveson sessions, Cameron said, “That was wrong, absolutely no doubt about that. The contact between the special adviser in the Department of Culture and News International was too close, too frequent.”
Embattled British politician Jeremy Hunt told reporters today in London that he would hand over private correspondence to the UK inquiry into media ethics. Hunt has come under fire since it was revealed Tuesday that …
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Although both James and Rupert Murdoch were expected to be giving evidence this week with regard to the phone hacking scandal, the whole process has taken a decidedly different tack. The fallout from James’ testimony on Tuesday resulted in the resignation of a top Parliamentary aide on Wednesday and a growing brouhaha inside Prime Minister David Cameron’s government. Culture Secretary Jeremy Hunt’s aide, Adam Smith, resigned after emails read on Tuesday showed a possibly inappropriate relationship between the minister’s office and James Murdoch during the BSkyB bid process. Hunt asked Lord Justice Brian Leveson to move up his scheduled testimony date but Leveson said yesterday he was going to continue with his planned timetable. Hunt will appear before the inquiry in May while Cameron and Tony Blair are expected in May or June. Also, the FSA, Britain’s equivalent to the SEC, is understood to be examining whether the email exchanges constitute market abuse. Rupert Murdoch’s testimony on Wednesday was squarely focused on his relationship to politicians. Day two of his evidence will begin soon and should last for a couple of hours this morning. It’s possible they’ll get to the phone hacking scandal today. All times below are UK local time.
10:09 Counsel Robert Jay asks Murdoch about David Yelland, editor of The Sun in the late 1990s. Yelland once said in an interview that “all Murdoch editors go on a journey where they end up agreeing with everything Rupert says…You look at the world through Rupert’s eyes.”
Murdoch: “I understand what you’re saying but I think it’s nonsense and should be taken in the context of Yeland’s strange autobiography,” in which he admits he was drunk most of the time at The Sun.
Murdoch: “I certainly do take part in the policy decisions of The Sun, I think that’s my job.”
Murdoch: “Generally speaking, the issues that we get interested in and fight for you’ll find them in The Sun and you’ll find that I would agree with most of them if not all.
10:12 Jay turns to Murdoch’s relationship with politicians and asks if they would know what Murdoch is thinking or his views by knowing him over time.
“I really only see very little of them. I’m only in this country less than 10% of my time…And, I think they know my philosophy, yes.”