British papers may be Murdoch’s next sacrificial lamb

By Nicholas Wapshott
The opinions expressed are his own.

Soon after Rupert Murdoch moved to Beverly Hills in 1986 to tinker with his new toy, Twentieth Century Fox, his wife at the time, Anna, was asked how she was enjoying Los Angeles. “Well, it’s very different when you don’t own the paper,” she said. In Sydney, London, and New York, Mrs. Murdoch was used to “A” list parties, tables in restaurants at short notice, the best seats for sold out shows. But wives of movie moguls, she fast discovered, were something less than the wife of someone who bought ink by the gallon.

Mr. Murdoch has his own reasons for “owning the paper.” As the scandal that is engulfing his company’s UK arm, News International, is exposing for all to see, he has had little compunction about marshaling his papers to further his interests. Although he is a free-market conservative, he is not concerned so much with party politics as ensuring that government regulations do not interfere with his business ambitions. In Britain in the last thirty years, those who aspired to power have had first to make their peace with him. Those, like Labour’s Tony Blair, who fell in with his plans, performing as the star turn at a management retreat on Hayman Island, Australia, were blessed with benign coverage. Conservatives like John Major, whom he disliked, were subject to ad hominem assaults in his papers.

Now that News Corp’s corporate culture has been shown to have failed to prevent voicemail hacking and police bribery in London, the question being asked on both sides of the Atlantic is, how far did the illegality extend? Hacking at the News of the World was, it seems, matched by sharp practice at The Sun and The Sunday Times. Murdoch’s world turned out to be little more than a free market version of “The Lives of Others.”

Have editors at the New York Post or Fox News, too, been turning a blind eye to bugging phones or paying police for stories? What bargains have been made to keep politicians’ dirty linen from being aired? What grubby secrets have been exposed because their perpetrators failed to tow the line? Above all, is Rupert Murdoch going to take responsibility for this sorry state of affairs?

Many companies are made in the image of their boss, but none more so than News Corp. While Murdoch has been obliged to delegate at his TV network, at Fox News, and at the Fox movie division, Murdoch, a brilliant tabloid journalist, is the true editor-in-chief of his newspapers, as every editor who has worked for him knows – full disclosure: I was an executive at The Times, London, 1992-2004. As Andrew Neil, a dozen years The Sunday Times editor, wrote, “Anybody of importance reports direct to him. Normal management structures . . . do not matter.”

How I misread News Corp’s taxes

By David Cay Johnston. The opinions expressed are his own.

Readers, I apologize. The premise of my debut column for Reuters, on News Corp’s taxes, was wrong, 100 percent dead wrong.

Rupert Murdoch’s News Corp did not get a $4.8 billion tax refund for the past four years, as I reported. Instead, it paid that much in cash for corporate income taxes for the years 2007 through 2010 while earning pre-tax profits of $10.4 billion.

For the first time in my 45-year-old career I am writing a skinback. That is what journalists call a retraction of the premise of a piece, as in peeling back your skin and feeling the pain. I will do all I can to make sure everyone who has read or heard secondary reports based on my column also learns the facts and would appreciate the help of readers in that cause.

Advisory: David Cay Johnston column on Rupert Murdoch is withdrawn

Please be advised that the David Cay Johnston column published on Tuesday stating that Rupert Murdoch’s U.S.-based News Corp made money on income taxes is wrong and has been withdrawn. News Corp’s filings show the company changed reporting conventions in its 2007 annual report when it reversed the way it showed positive and negative numbers. A new column correcting and explaining the error in more detail will be issued shortly.

Arthur Andersen. Anthony Weiner. News Corp?

Arthur Andersen. Anthony Weiner. News Corp?

Sure, it’s too early to “go there.” News Corp is an immense, diversified multi-national media conglomerate that has been widely reviled by many for more than a generation. For all of his detractors there are plenty of readers, viewers and shareholders who are just fine with Rupert Murdoch’s tabloidization and opinionization of the news business.

The New York Post may chronically lose money but such things are hardly news in the newspaper business. Yet the Post is a metaphor for the Murdoch empire. When Rupert amped up the sleepy New York tabloid to take on the New York Daily News, he started a media revolution with the newspaper that had been founded by Founding Father Alexander Hamilton.

It all seems so quaint now, with cable news talk show hosts having no qualm about taking sides in the style set by Fox News, and with newspapers still struggling to re-establish their relevance as a medium.

Can politicians finally escape Murdoch’s grasp?

By Bruce Page
The views expressed are his own.

The News of the World was a survivor, increasingly moribund, from dark, forgotten passages in British social history.

Likewise, the Murdoch family is a political throwback — but thus far their wealth and their influence have escaped the lethal damage the News of the World did to itself. Though much diminished, the Murdochs might yet restore their peculiar system — in which media boss and political syndicate practice mutual exploitation, to the visible decay of effective democracy.

A similar symbiosis threatened when Thomas Jefferson worried that decent government could not exist without decent newspapers. But the threat generally retreated between Jefferson’s time and the last third of the 20th century. It was then, in 1969, that Rupert Murdoch, new proprietor of the News of the World, set about his life’s work: revitalizing that special relationship, along lines pioneered by his father, Keith, as a journalist in the Great War, government propaganda minister during World War II and newspaper owner in Australia.

News of the World hacking scandal: UK’s Miliband speaks out

UK opposition leader Ed Miliband called on the British media to clean up its image and emphasized the need for a speedy public inquiry into the News of the World phone-hacking scandal. Watch clips of Miliband’s comments at a Thomson Reuters Newsmaker event below:

Miliband to British media: “Clean up your image”

Miliband calls for judge-led inquiry into phone-hacking scandal

Miliband wants media watchdog scrapped

Miliband calls for BSkyB referral

Miliband urges UK Prime Minister David Cameron to apologize

Follow our live coverage of the phone-hacking scandal below:

Closing a tabloid won’t stop the cheating culture

By David Callahan
The views expressed are his own.

The demise of the News of the World after a phone hacking scandal will not change a troubling truth about tabloid journalism – or business in general these days: Bad ethics can yield big financial rewards and such are the upsides of cheating that even honest professionals may feel they must bend the rules to compete.

Tabloid editors will surely think twice now before drawing on illegally obtained information. But other unethical practices – used by a range of print, broadcast, and online media businesses – will continue, like paying sources for dubious information (“cash for trash”) or fabricating juicy stories outright to boost circulation or ratings.

This sleaze machine is fueled not by the deviance of editors and producers but by rational incentives. The media business is brutal, with intense competition, impatient shareholders, and often razor-thin profit margins. Everyone in this world is under extreme pressure to perform and cutting ethical corners is one way to get an edge. The News of the World became Britain’s highest-circulation newspaper in large part by being less scrupulous than the competition. Cheating paid – at least until this week.

Rupert Murdoch’s global empire

A scandal rocking Rupert Murdoch’s media empire deepened on Thursday with claims his best-selling News of the World paper hacked the phones of relatives of British soldiers killed in action. The latest allegations prompted News Corp to shut down the 168-year-old tabloid. Here’s a look at the rest of the empire.

Tech wrap: Facebook zooms into video age

Starting today, Facebook users will have the option of holding one-on-one video calls with their friends directly from their account on the social network. The new Skype-powered video service marks a renewed effort by Facebook to cement itself as the go-to communications hub on the Web and serves as a response to Google’s recently launched Hangouts app, a similar video chatting feature that lets users on its Google+ social network chat with up to 10 people at once.

Facebook’s video chat will be embedded directly into the site’s messaging platform and won’t require users to sign up for Skype separately to use it. Skype stands to see a big boost from the partnership seeing as it could open it up to a whole new set of users.  So how does Facebook’s video chat compare to Google’s? TechCrunch finds there’s little overlap at this point between the two services, arguing the former is well-designed for one-on-one pow-wows whereas the latter is better suited to group chats. In addition, Facebook unveiled a new group-messaging feature that lets users take part in text chats with multiple friends.

Remember that man who was accused early this year of hacking into AT&T’s servers and stealing personal data from 120,000 Apple iPad customers? Well, he was indicted on Wednesday by a Newark, New Jersey grand jury with one count of conspiracy to gain unauthorized access to computers and one count of identity theft. The charges come two weeks after a co-defendant in the case pleaded guilty.

Tech wrap: And Myspace goes to . . .

News Corp’s hunt to find a buyer for once-mighty social networking website Myspace has finally ended. Specific Media, an online advertising firm, has agreed to buy the site for about $35 million, a source familiar with the deal told Reuters. News Corp will retain a minority 5 percent stake in the website it purchased six years ago for $580 million. More than half of the site’s 500 employees are expected to be laid off as part of the deal.

Tech watchers will have to wait at least another sleep to find out more about Zynga’s plans for an initial public offering. A source familiar with the matter told Reuters that the online social gaming firm behind popular Facebook game FarmVille is expected to file for an initial public offering with U.S. regulators on Thursday morning. Earlier reports suggested the company could raise up to $2 billion in the offering and value the firm as high as $20 billion. AllThingsD’s Kara Swisher sizes up how Zynga’s expected IPO fits in with other recent filings from similar companies such as Groupon.

Twitter’s Biz Stone and Evan Williams are leaving the site they co-founded and helped popularize – sort of. Both men will continue to advise Twitter on strategic matters but will spend the bulk of their days working at the newly-revived Obvious, the tech incubator company they started years ago that led to the creation of Twitter. Stone summed up their new plans in a blog posting on his website: “Our plan is to develop new projects and work on solving big problems aligned along a simple mission statement: The Obvious Corporation develops systems that help people work together to improve the world.”