Global Showbiz Briefs: UK Phone Hacking, Network Ten, YOU On Demand, Nine Ent.

UK Phone-Hacking Could Haunt Murdochs For Three More Years
Rupert Murdoch could be 84 years old before the British police complete multiple investigations into The News of the World phone-hacking scandal. Deputy assistant commissioner Sue Akers, who’s in charge of three overlapping probes into alleged criminal wrongdoing by journalists, said the task may continue through 2015, according to the Guardian. Akers, who is retiring in October, told a Commons home affairs select committee that “resources have been factored in for the next three years.” She said the force had identified more than 4,700 potential phone-hacking victims and found 1,069 were likely to have had their voicemail messages intercepted. So far 79 people have been arrested including former News International legal adviser Tom Crone, former chief executive Rebekah Brooks, her husband Charlie and Prime Minister David Cameron’s former spin doctor Andy Coulson. Akers said the Metropolitan Police and Crown Prosecution Service would consider the likelihood of further criminal prosecutions, adding, “We are now prioritising getting cases through court.” Scotland Yard still has 185 officers working on the investigations.

Network Ten Shares Slide To Record Low
Australia’s Network Ten board members Lachlan Murdoch (chairman), Gina Rinehart and Jack Cowin seem powerless to stop a steep slide in the company’s fortunes. The share price hit a record low of 37.5 cents today, down from 80 cents in March, and broker Commonwealth Bank Global Markets Research forecasts it will sink as as low as 30 cents. Ten’sratings have taken a hit from the failures of three Australian shows launched after the London Olympics, Everybody Dance Now, I Will Survive and Don’t Tell the Bride, which resulted in the exit of chief programmer David Mott. The only new show that has any traction is Puberty Blues, a drama inspired by Bruce Beresford’s 1981 feature. The ratings of Ten’s main channel have declined by 5% this year while Nine is up by 5.3% and Seven is off by 0.3%. The broker said Ten is “working hard to reposition itself and build out a new programming lineup, however we see continued ratings/revenue share risk given the large number of hours that need to be replaced and expect the TV ad market to remain challenging.” - Don Groves
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Police Chief Updates UK Inquiry On Hacking & Bribery Probes; New Names Involved

Eight months of testimony are finally winding down at the Leveson Inquiry into UK media ethics. The panel, convened in the wake of the phone hacking scandal at the News Corp-controlled News Of The World, heard again today from Metropolitan police deputy commissioner Sue Akers. Akers has been leading the probes into alleged illegal activities by journalists including phone and computer hacking and bribery. In February, she told the inquiry there appeared to be “a culture of illegal payments” at News Corp’s The Sun newspaper. Today, she said police had determined that public officials, including a high-security prison guard, have received payments from more than one newspaper, expanding the field to those owned by Trinity Mirror and Express Newspapers along with News Corp’s News International. (In Express chief Richard Desmond’s earlier statement to the inquiry, he said he was unaware of any such activity at his papers.) When Akers appeared in February, News Corp said the practices she’d described were “ones of the past.” Akers confirmed today to Lord Justice Brian Leveson that there has been a change in the culture and practice of News International. Akers also told the inquiry that News Corp’s internal Management and Standards committee has proffered significant Read More »

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News Corp Scandal One Year Later: Where Does The Publishing Arm Go From Here?

This time last year, Rupert Murdoch’s UK media empire was thrust into the biggest newspaper scandal in recent memory when police alleged journalists at the News Of The World had hacked into the voice mails of murdered schoolgirl Milly Dowler. A year ago today, on July 7th, 2011, Rupert’s son James Murdoch announced the News Of The World would be shut down. Fast-forward 51 weeks, and Rupert is making headlines of a different sort as he announced the split of his global conglomerate News Corp into two companies, effectively fencing off the tainted UK publishing assets – though he contends that was not the motive. While Murdoch will serve as chairman and CEO of the entertainment businesses on one side, with Chase Carey as president and COO, there is no management in place for the publishing side. Dow Jones and The Wall Street Journal will be at the forefront of the new operation. But who will run it? And, can the scandal ever become yesterday’s news?

Names floated to take the reins include Tom Mockridge, a longtime News Corp employee who is now chief executive of News Corp’s press arm, News International — a role he took when scandal-stained Rebekah Brooks resigned last year. (Brooks is now facing charges of conspiracy to pervert the course of justice.) A note from Enders Analysis says “we would be surprised” if Mockridge “was not among the key candidates to run the publishing company.” But, Ken Doctor, media analyst for Outsell and Newsonomics, thinks it would make sense if the new chief “came from in or around Dow Jones.” Chief exec of Dow Jones, Lex Fenwick, joined the company from Bloomberg in February and although Doctor tells me “he does seem like a longshot,” it’s worth remembering that “this is all happening in a year. They don’t need to appoint someone for at least nine months. Fenwick has a long track record in the industry. He’s new at Dow Jones and he’s making major changes. If Rupert likes the cut of his jib in 6-9 months,” Fenwick could be the man. Read More »

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UK Committee’s Phone-Hacking Report Chooses Words Carefully: Analysis

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. Read More »

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Phone-Hacking Scandal: Reporters Said Not Responsible For Deleting Messages That Gave Girl’s Parents False Hope

New information emerged over the weekend in the News Of The World phone hacking scandal. Police are said to have concluded that reporters from the shuttered paper were not responsible for deleting certain messages on the answering machine of murdered … Read More »

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Chase Carey Says News Corp Will “Do What’s Necessary” To Grow Hulu: UBS Confab

You wouldn’t know that the Hulu auction was a failure based on the way News Corp COO Chase Carey describes the owners’ plans. They decided to hang on to the digital video service because its value to them “dwarfed some of the values that were being put on it” by bidders including Dish Network and Google. Keeping Hulu reflects “a judgment that this digital space is incredibly important and is going to be, over the next five years and beyond, the most important field we have to navigate.” As a result, he told the UBS Annual Global Media and Communications Conference, “we’ll do what’s necessary to make it grow.” But that doesn’t necessarily mean adding movies to the package to make it more competitive with Netflix. ”Me-toos aren’t a great place to be in this business,” Carey says. “We want to look at it with a fresh eye.”

Investors strangely seemed uninterested in the News Of The World hacking scandal. But one of the consequences — News Corp’s decision to abandon its effort to buy BSkyB — was a concern. Carey says that it’s “one of the things we have to figure out” because he says the company gets ”a fraction of credit” it believes it deserves for its 39% stake in the UK media company. News Corp must ”do a better job communicating value.” Still, he didn’t leave investors empty-handed: Carey says that News Corp’s recently launched round of share repurchases is “certainly not a one-time thing. It’s an important part of our capital allocation,” he said, adding that News Corp shares are ”woefully undervalued.” Read More »

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Hugh Grant: UK Officials Must Crack Down On Tabloid “Privacy Invasion Industry”

Actor Hugh Grant called on UK lawmakers to regulate news organizations that he says frequently use unethical tactics to violate the privacy of celebrities like him — and ordinary people who unwittingly find themselves in the public spotlight. There’s “almost no journalism now” in Britain’s tabloid press – which he called the “privacy invasion industry” in testimony to the Leveson Inquiry which is looking at the News Of The World phone hacking scandal and the country’s press culture. “It’s almost never (about the) public interest,” he says. “There has been a section of our press that has been allowed to become toxic (using) bullying, intimidation, and blackmail….It’s time this country found the courage to stand up to this bullying.” Although it’s “a lovely idea” to let news organizations regulate themselves, it “absolutely has been shown not to work. ..This is the big opportunity now, this inquiry.” And it need not result in censorship of legitimate news or opinion, he says: “I don’t think it is that difficult to tell what is bath water and what is a baby. To most people it is pretty obvious.”

Grant said it’s “a big myth” that actors benefit from tabloid publicity. “In 17 years I’ve only given two interviews in the British press.” He says that he hires publicists in the U.S. when he has a new film, but “they’re like anti-publicists.” Studios “will be desperate for you to do everything” and Read More »

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Murdoch Apology Was “Tense” But “Sincere” – Murdered Schoolgirl’s Family Tells UK Inquiry

The parents of Milly Dowler told a UK inquiry into the News Of The World hacking scandal this morning that the family admonished Rupert Murdoch to “set things right” in July when he visited to apologize for the tabloid’s actions … Read More »

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Hugh Grant And J.K. Rowling To Join Other Celebs Testifying About News Corp Scandal

This will be another bad week for James Murdoch and News Corp as 21 witnesses including several celebs line up to tell a government inquiry how overzealous and unethical reporters turned their lives upside down. The investigation is led by Lord Justice Leveson who Prime Minister David Cameron asked to examine both the phone hacking at News Of The World, and problems with the country’s press culture. The parents of Milly Dowler, a 13-year-old who was murdered in 2002,  will kick things off tomorrow. The NOTW scandal broke open this past July when it was disclosed that after Dowler was missing the tabloid hacked into the girl’s phone and deleted messages, giving her parents false hope that she might still be alive. Grant will follow them, and is expected to continue his assault on reporting tactics used by NOTW and the Daily Mail. Also due on Monday is the lawyer for actor Jude Law. On Tuesday the panel will hear from actor Steve Coogan and soccer star Garry Flitcroft. On Thursday Harry Potter author Rowling and one time Formula One chief Max Mosley will testify. Next Monday singer Charlotte Church and UK TV personality Anne Diamond will appear.

Coogan outlined his views in a biting commentary he wrote for The Guardian on Friday. “No amount of respectable, well-modulated management-speak from James Murdoch can disguise the direct link between Read More »

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What Will James Murdoch Say Tomorrow?

Observers I have spoken to predict that News Corp’s James Murdoch will be better briefed than he was in July — and may admit to a small mea culpa — when he returns to Parliament tomorrow to answer questions about the News Of The World phone-hacking scandal. He’s expected to continue to defend his inaction about the lawbreaking in the face of mounting evidence that he must have known more about the problem earlier in the process than he previously testified. Back in July, he denied knowing until late 2008 that phone-hacking at NOTW went beyond one rogue reporter. That would clear him of the charge that he authorized hush-money earlier in the year when he approved a $1.4M settlement for a hacking victim who knew that a second reporter was involved — on the condition that the victim he keep quiet about the matter. Since Murdoch testified, senior News International executives have gone public and said James must have known the gory details because they told him. And a devastating legal opinion has come to light from lawyer Michael Silverleaf, who worked for News International and pointed out that NOTW had a culture of illegal information-gathering. There is no smoking gun to contradict James, just vague notes written up after briefing meetings with him. Read More »

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Hacking Update: News Of the World Lawyer Warned Email Was “Fatal To Our Case” Ahead Of Crucial James Murdoch Meeting

More bad news for James Murdoch today ahead of his appearance next week before the UK Parliament’s culture committee, which is investigating the News Of The World phone-hacking scandal. The committee just released a tranche of legal correspondence that includes a letter supporting James’ chief opponents, former NOTW in-house lawyer Tom Crone and editor Colin Myler. They testified in September that they were “certain” Murdoch knew in 2008 about an email that indicated more than one journalist was involved in the lawbreaking — blowing a hole in the Murdoch’s claim that at the time he believed the trouble was limited to a single “rogue” reporter. If they’re right, then it suggests Murdoch tried to cover up the extent of the lawbreaking that year when he authorized a $1.4M out-of-court settlement with a non-disclosure clause to soccer chief Gordon Taylor, a hacking victim who knew that a second reporter had been implicated. One big question is whether the executives appreciated the implications of the email — addressed “For Neville” — that included transcripts from private calls. A just-released letter that Crone wrote to Myler on May 24, 2008, prior to a meeting with Murdoch indicates that they did. It said that the email “is fatal to our case” against Taylor. Read More »

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James Murdoch’s Succession Prospects Dim As He Prepares To Testify Again About Hacking Scandal

James Murdoch isn’t going to succeed his father Rupert as CEO of News Corp — if you don’t believe that yet, then wait for November 10 when he’s due to testify again before the parliamentary committee investigating the News Of The World phone-hacking scandal. Media execs and close News Corp watchers tell me that James would have to perform a PR miracle to enhance his already tarnished reputation: He’s on the defensive after former NOTW legal affairs manager Tom Crone and editor Colin Myler testified in September that he knew more about the lawbreaking earlier than he has let on — raising the possibility that he was engaged in a cover-up. James’ testimony comes after institutional shareholders just made it clear that they don’t want him: Guardian columnist Dan Sabbagh called the News Corp Deputy COO “dead man walking” last week after 75% of voting shareholders aside from the Murdoch family, other directors, and Rupert’s ally Prince Alwaleed Bin Talal opposed James’ election to the board. Analysts and reporters will have a chance to raise more questions about the company’s governance Wednesday after News Corp reports its earnings for the quarter that ended in September.

A lot of people say James is in a similar predicament to the one that former Disney CEO Michael Eisner was in before he was forced out in 2005. Eisner initially fended off efforts by former board members Roy Disney and Stanley Gold to oust him from power. But their steady criticisms soured institutional investors to the point where Eisner’s presence hurt Disney’s stock and made it impossible to hang on. Read More »

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What A Lousy Week For Rupert Murdoch…

It was bad enough that hundreds of Occupy Wall Street protesters stopped by his Fifth Avenue home on Tuesday to chant slogans about the unfairness of the tax system. The media mogul’s troubles also grew as he had to deal with a second UK newspaper scandal: The publisher of the Wall Street Journal Europe, Andrew Langhoff, resigned amid allegations that he had cut a deal to artificially inflate circulation figures by 41%. And that story began to unravel just as the UK Parliament’s Culture, Media and Sport Committee said it will interrogate Murdoch’s right-hand man Les Hinton on October 24 as part of its investigation into Murdoch’s other UK newspaper problem –  the News Of The World phone-hacking scandal. This matter has already begun to loom large as investors prepare to converge in Los Angeles next Friday for News Corp’s annual shareholder meeting. Advisory firms Institutional Shareholder Services, Egan Jones, and Glass Lewis asked stock owners to reject several company board nominees — including Murdoch’s two sons, James and Lachlan — for failing to get to the bottom of the hacking allegations before the company was forced to close NOTW. Read More »

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Discovery And News Corp Flunk Research Firm’s Governance Tests

It’s not surprising to see that News Corp was one of 10 companies given an “F” grade by corporate research firm GMI Ratings for management or accounting practices that could make them risky bets for investors. But Discovery Communications — … Read More »

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UPDATE: Date Set For Les Hinton Testimony As News Corp Fires Back At Attacks On Board

UPDATE, 9 AM: The UK’s Culture, Media and Sport Committee has set its schedule for the next round of evidence sessions in the parliamentary body’s investigation into the News Of The World scandal. The big name on the latest list is Les Hinton, the former Wall Street Journal boss and Rupert Murdoch confidante who resigned in July; he ran News Corp’s UK newspaper division News International when the hacking was most rampant. Hinton will testify October 24 via video link. Of course, the biggest fish — News Corp No. 2 James Murdoch, the company’s deputy COO and heir apparent to his father — is not on the list … yet. Both he and Hinton have already testified but were summoned back to the committee last month.

PREVIOUS, 5:03 AM: News Corp is acting like it will have a fight on its hands at the October 21 shareholders’ meeting, even though CEO Rupert Murdoch controls more than enough votes to pretty much dictate the outcome. In an SEC filing this morning, the company responded to advisory firms Institutional Shareholder Services and Glass Lewis, which urged investors to reject several board candidates including Deputy COO James Murdoch. News Corp says that it’s run by “sophisticated, world-class directors” who deserve to be re-elected. The company chafed at the advisory firms’ view that the board turned a blind eye to the News Of The World phone-hacking scandal. While the NOTW matter “could affect News Corporation’s results of operations and financial condition,” the company repeated its view that it ”has already taken decisive actions to hold people accountable and will take all prudent steps designed to prevent something like (the NOTW scandal) from ever occurring again.” Read More »

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News Corp Stung By Shareholder Advisory Services Urging Investors To Reject James Murdoch And Other Board Candidates

Things could be interesting in Los Angeles on Oct. 21 when News Corp holds its annual shareholders meeting. Advisory firm Institutional Shareholder Services recommended today that stock owners reject 13 of News Corp’s 15 board members, including the three Murdochs: Rupert and his sons James and Lachlan. Joel Klein, who runs News Corp’s Education Division, and Accel Partners’ James Breyer were the only nominees deemed acceptable by ISS. The firm says that while the News Of The World phone-hacking scandal ”is perhaps the most visible and severe example of the failure of board stewardship, it is part of a mosaic of failures of board independence, oversight, and responsiveness to shareholder concerns stretching back at least to 2004, when the company reincorporated from Australia to Delaware.” The report probably won’t affect the outcome of the shareholder vote: Due to News Corp’s dual stock arrangement, the Murdoch family controls about 40% of the voting shares even though it owns just 12% of the equity. Rupert’s ally, Prince Alwaleed bin Talal, controls an additional 7% of the votes.

News Corporation says that it “strongly disagrees” with ISS’ recommendations because the “disproportionate focus” on the scandal is “a disservice to our stockholders.” The company adds that ISS “failed to consider that the Company’s compensation practices reflect its robust performance in FY 2011 driven by its broad, diverse group of businesses across the globe.” Read More »

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Hacking Scandal Update: Fired News Of The World Reporter Warns News Corp That “Truth Will Out”

The News Of The World phone hacking scandal became more nettlesome for News Corp this morning: A key player, former NOTW reporter Neville Thurlbeck, issued his first public statement alleging that the company wrongfully fired him recently — and warned that “There is much I could have said publicly to the detriment of News  International but so far, have chosen not to do so.” He says the company recently attacked him in off-the-record interviews. He called for everyone to “retain a dignified silence until we meet face to face in a public tribunal where the issues can be rigorously examined and fairness can eventually prevail.” He added, ominously, that “those responsible for the action, for which I have been unfairly dismissed, will eventually be revealed.”

Thurlbeck could be a dangerous opponent for the company and deputy COO James Murdoch. Thurlbeck was the intended recipient of the famous “For Neville” email in 2008. It included material hacked from the phone of Gordon Taylor, the former head of the Professional Footballers Association. The email is significant because it seemed to indicate that the illegal practice was more widespread than News Corp had acknowledged. At least two former NOTW execs say that Murdoch had seen that email before he agreed to a $1.4M settlement with Taylor on the condition that he keep quiet — leading some members of parliament to wonder whether Murdoch was engaged in a cover-up. Murdoch says he did not see the email before agreeing to the settlement. Thurlbeck was arrested in April on phone hacking charges.

Here’s Thurlbeck’s statement, which ran in The Telegraph: Read More »

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News Corp COO Chase Carey: “Nothing We’ve Seen” To Support Allegations That 9/11 Family Phones Were Hacked

News Corp COO Chase Carey bobbed and weaved today when audience members at the Goldman Sachs Commmunicopia Conference asked questions that touched on the company’s hacking and police bribery scandals. “The media noise has been surreal around it,” he says. “The truth will come out. The issues will work their way out.” He did note that there’s “nothing we’ve seen” to support the allegation — which the Justice Department is investigating — that News of the World may have hacked phones of families of 9/11 victims. Carey wouldn’t rule out the possibility that News Corp might renew its effort to buy the 61% of BSkyB that it doesn’t already own. “We’ll continue to be a shareholder. … We have a lot of flexibility if and when something arises.” He added that he’s “not going to get into speculating” about whether UK officials might force News Corp to give up its current shares in the satellite power. As for the newspaper publishing business — which a lot of investors would like to see News Corp dump – Carey says the company should “take a fresh look at it.” But that could involve expanding operations such as Dow Jones and The Wall Street Journal. “There are things beyond (putting them on iPads) that we can do.” Read More »

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Can News Corp Escape Scandal Unscathed?

If you look at News Corp’s stock price since July 4, you might wonder whether you’re peering into a parallel universe. This is a period during which the company’s been battered by damaging revelations from the News of the World phone hacking and police bribery scandals. But investors seem unconcerned. After an initial dive, News Corp stock rebounded and now almost exactly matches the performance of the overall market — the company and the benchmark Standard & Poor’s 500 index both are down about 10%. It’s easily explained. Investors like all the cash Rupert Murdoch’s cable networks generate. They’re delighted by News Corp’s begrudging agreement to repurchase $5B of its stock. Shares also are relatively cheap: Many investors still fear that Murdoch will make a crazy acquisition — like he did in 2007 when he spent $5B for Dow Jones. News Corp trades for about 10 times expected earnings while Viacom is close to 13.5, Comcast is about 12, and Disney’s around 11.3. So News Corp is a smart buy if you believe that the scandal will force Murdoch to placate investors and will blow over before it seriously damages the company’s finances. Similar cases often do.

But this one probably won’t — and it will be interesting to see how long it takes before investors become frightened. Investigations into possible lawbreaking at News Corp are just getting started. That’s a sobering thought when you consider how much has already happened since July 4, when The Guardian broke the scandal open with its report that NOTW in 2002 tampered with voicemails of a missing schoolgirl Milly Dowler, later found murdered. Murdoch had to abandon his $12B effort to buy the 61% of BSkyB he doesn’t already own. Many UK officials want News Corp to sell off its holdings in the satellite power. Meanwhile, Murdoch probably won’t be able to turn News Corp over to his son James. Parliament’s Culture, Media and Sport Committee says it will ask him to testify again as members bear down on allegations that James tried to cover up the extent of NOTW’s lawbreaking. Scotland Yard, embarrassed by reports that police accepted bribes to help NOTW phone hackers, is working the case hard and has already made 16 arrests. Potentially damaging evidence is still surfacing: Last week, News International said that it found “many tens of thousands” of emails and other documents about NOTW. Former News International CEO and NOTW editor Rebekah Brooks — one of the people who has been arrested — is among the many witnesses who’ll testify at a UK judicial inquiry that’s just beginning. The U.S. Justice Department is investigating whether NOTW hacked the phones of families of 9/11 victims. And News Corp faces dozens of civil suits. Hacking victims want to be compensated for their lost privacy. In addition, many shareholders want company directors to atone for rubber-stamping Murdoch initiatives that seemed to put his family’s interests ahead of investors’. Examples include News Corp’s $675M purchase of Elisabeth Murdoch’s TV company Shine — critics say the price was way too high — as well as the company’s failure to investigate NOTW’s hacking. Investors will have a chance to vent their anger at News Corp’s annual meeting Oct. 21: The company plans to fight a shareholder resolution that would strip Murdoch of the chairman title by requiring that the job be held by an independent board member. Read More »

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