Follow by Email

Monday, July 18, 2011


Phone-hacking scandal's far-reaching tentacles

Talk about a busy couple of days. The News of the World phone-hacking scandal continued into an overdrive pace as some of the highest figures implicated in the scandal thus far resigned or were arrested.
Former News of the World Editor Rebekah Brooks was arrested, becoming the highest-profile figure to be held over the scandal. Dow Jones' chief executive Les Hinton stepped down after working with News Corp. for 52 years.
The scandal has also forced the country's top police officer to resign, closed its best-selling newspaper and called Prime Minister David Cameron's judgment into question. And on Monday one of the first journalists to go on the record and allege phone hacking at News of the World was found dead, the British Press Association said. Sean Hoare, a former News of the World employee, "was discovered at his home in Watford, Hertfordshire, after concerns were raised about his whereabouts," the press association said.
It's a lot to wrap your head around - and there are a lot of people and institutions greatly impacted by the scandal. So we're going to break it down and take a look at the key players under fire, the tentacles of Rupert Murdoch's operations, who's implicated, and what what the scandal could mean for all of them.
How this all started

Murdoch closed News of the World last week, less than a week after it came out that reporters working for him had illegally eavesdropped on the phone of a missing girl, Milly Dowler, and deleted some of her messages to make room for more. She was later found dead.
Timeline: How scandal unfolded
Closing the paper has not put an end to the scandal, which has exposed the close links the British press has with both politicians and the police.
Police in the United Kingdom have identified almost 4,000 potential targets of phone hacking in documents recovered from a private investigator working for the paper.
The FBI is also investigating News Corp. after a report that employees or associates may have tried to hack into phone conversations and voice mail of September 11 survivors, victims and their families.
The key players:

To understand the scandal, you've got to be able to understand the tentacles of Rupert Murdoch's News Corp., which encompasses Fox News, The Wall Street Journal, the New York Post and Harper Collins publishers in the United States. News International - a British subsidiary of News Corp. - owns The Sun, The Times and The Sunday Times in Britain. And then there are the allegations of political and police officials being a part of the scandal. They're important to factor in here too.
So let's dive into the big players.
Rupert Murdoch
He's the man at the top of a collapsing international media conglomerate right now. With a phone-hacking scandal engulfing his massive media empire, Murdoch has been apologizing to the British public with full-page advertisements in seven national newspapers.
But apologies alone don't appear to be solving the crisis Murdoch is facing.
Professor John R. Kimberly, who also co-authored "The Soul of the Corporation: How to Manage the Identity of Your Company" says, "ironically Rupert Murdoch is caught in a web of his own making."
GPS: The fall of the house of Murdoch
"His British assets and actions already under siege, the mogul must now answer before a judge for a tangled media scandal. And the consequences are reaching across the Atlantic,"'s Nick Assinder writes.   "Is this the beginning of the end of the house of Murdoch?" he asks.
The biggest question seems to be how this will all play out for Murdoch and as puts it: Whether Murdoch's struggle to preserve his influence can persevere through the scandal.

Perhaps there will be some answers when he, his son and former News of the World Editor Rebekah Brooks face parliament on Monday. James Murdoch
News Corp. deputy Chief Operating Officer and BSkyB Chairman James Murdoch, who is Rupert Murdoch's son, will also be called to answer questions from the U.K parliament over the scandal.
It was the son who made the decision to shut down the News of the World. And now the heir apparent to the empire may in fact face some of the harshest criticism as he has toes dipped in both sides of the pond. It could be a case of "Double Trouble" as puts it.
"James is a heavy favorite to one day succeed his father as News Corp.'s chief executive,"'s Nick Carbone writes. "But how far will James – and the company – fall if legal charges are brought forth?
Rebekah Brooks
So just who is Rebekah Brooks? The youngest ever editor of a U.K. newspaper, described as both "ruthless" and "charming" and known for her "tenacity as a reporter," she forfeited her stellar rise through Rupert Murdoch's media empire when she resigned on Friday. She was arrested Sunday on charges related  to the scandal.
She held the top job at News International, the News Corp.'s British subsidiary, for two years after editing the country's best-selling daily tabloid, The Sun, and its best-selling Sunday tabloid, News of the World.
Brooks is due to appear before members of Parliament on Tuesday alongside her former boss, media baron Rupert Murdoch, and his son James, an executive of News Corp.
Andy Coulson
BBC business editor Robert Peston has claimed that News of the World e-mails showed former royal correspondent Clive Goodman "was requesting cash from the newspaper's editor, Andy Coulson, to buy a confidential directory of the royal family's land line telephone numbers, and all the phone numbers - including mobiles - of the household staff."
Goodman was sent to prison in 2007 for illegally intercepting royal family voice mail. Coulson insisted he knew nothing about the crime, but resigned as editor because it happened on his watch.
Coulson then went on to become communications director for David Cameron, now Britain's Conservative prime minister, but resigned from that post earlier this year because of fallout from the phone-hacking scandal. He was questioned by police and released on bail until October.
British Prime Minister David Cameron
British Prime Minister David Cameron has been among those publicly decrying the hacking, blasting Murdoch's company Wednesday as he launched a high-powered judge-led investigation into the nation's press. He was part of the wide-ranging investigation into the British press which led to Murdoch's News Corp. withdrawing its bid to take over British satellite broadcaster BSkyB.
News Corp. executives need to focus "on clearing up the mess and getting their house in order," Cameron said.
Yet he has his own ties to the scandal, given his relationship with Andy Coulson.
Analysis: Hacking scandal is bad news for UK prime minister
The scandal has prompted questions over the British prime minister's judgment in hiring Coulson after he resigned as editor of the News of the World because of the allegations.
Speaking shortly before his former aide's arrest was announced, Cameron went on the defensive at a Downing Street news conference Friday, saying: "The decision to hire him was mine, and mine alone."
He said he gave Coulson a second chance after receiving assurances that he had not been involved in wrongdoing at the newspaper.
Les Hinton
The chief executive of Dow Jones stepped down from his post Friday after being with News Corp. 52 years. During much of that time he played a critical role in Murdoch's media empire.
But after Rebekah Brook's departure, he was the next company executive to emerge with a target on his back.
Before heading up Dow Jones, Hinton preceded Brooks as the executive chairman of News International during the same years News of the World was allegedly hacking into voice mails of British celebrities and politicians, as well as a murdered teen girl and the father of a bombing victim.
"The pain caused to innocent people is unimaginable," said Hinton. "That I was ignorant of what apparently happened is irrelevant and in the circumstances I feel it is proper for me to resign from News Corp, and apologize to those hurt by the actions of the News of the World."
He believed the "rotten element at News of the World had been eliminated" by the time he left News International to go to Dow Jones, he said.
Metropolitan Police Commissioner Paul Stephenson and Assistant Commissioner John Yates
Britain's top police officer, Metropolitan Police Commissioner Paul Stephenson, resigned in light of close links between the police and journalists they were supposed to be investigating. Why the police chief's resignation is problematic for PM Cameron
And on Monday the British police officer who ruled two years ago that there was no reason to pursue an investigation into phone hacking by journalists resigned Monday, the second top Metropolitan Police officer to quit in less than 24 hours.
Assistant Commissioner John Yates  was due to be suspended when he quit, the Metropolitan Police Authority said - also apparently related to the scandal.
So, what happens next?

British Home Secretary Theresa May is due to address lawmakers on the relationship between the police and the press Monday, a day after Commissioner Stephenson quit.
And on Tuesday British lawmakers will fire questions at media baron Rupert Murdoch, his son James and former News of the World editor Rebekah Brooks as they testify before them about the hacking scandal.
Parliament's Culture, Media and Sport Committee asked the three to appear.
The chairman of the committee, John Whittingdale, told CNN that he has plenty of questions to ask.
"The first thing is that James Murdoch has said he has discovered that Parliament, and that means my committee, was misled by some of the executives who have given us evidence in the past," he said. "So we will obviously want to know who has misled Parliament and what it was they said which was untrue."
Officials will look to establish who authorized the "very serious criminal activities" under scrutiny, Whittingdale said. "Anybody who was complicit in that, who knew about them, potentially is vulnerable."
Where the scandal leads from here is anyone's guess. Each day new tentacles have grown or gotten longer with new details uncovered and resignations coming from every direction.
Rebekah Brooks' arrest meant she was the eighth person arrested in connection with the phone-hacking probe and the fourth arrested in the bribery investigation, police said Sunday. Two people, including Brooks, have been detained over both probes, meaning a total of 10 people have been arrested.
Ultimately, the big question is, at the end of this all what will Murdoch's media empire look like? Will it be nothing more than a dismantled former conglomerate or will it eventually be able to regain it's footing?
And how far will those tentacles reach across the Atlantic? Will Murdoch's big assets in the U.S. - Fox News, Wall Street Journal, New York Post, etc. - feel the impact too? Time will tell.

No comments:

Post a Comment