The traditional shareholder revolt at NewsCorp (owner of Fox, Fox News, Sky, Harper Collins, the NY Post, the Wall Street Journal, the Sun) is back for another run, and this time it's gathering steam and may indeed make it. Rupert Murdoch and his family own a minority of the shares in NewsCorp, but their shares are in a special class of voting stock that means that they effectively get to do whatever they want with the majority investors' money. Effectively, Murdoch's initial pitch to investors was, "I'll take your money, but I'm not interested in your advice -- just cough up, shut up, and let me run this thing and I'll pay you some fat dividends."
But it's all gone rather wrong. Murdoch's ideological projects and nepotism have cost the business millions -- between a sweetheart deal that saw the company buying his daughter Elisabeth's startup Shine for £413M of the shareholders' money, and his son James's presiding over a phone-hacking scandal that destroyed News of the World, the bestselling newspaper (sic) in Britain, the investors are getting a bit tired of Murdoch running NewsCorp like his own personal fiefdom. It's one thing to play Colonel Kurtz in the jungle when it's making the shareholders rich, but when you start frittering away titanic assets like the NotW because you need to give your idiot son a job, well, that's another story.
As I said, this isn't the first time the shareholders have taken a swing at Rupert and his spawn, but this is a bigger, more multi-pronged, and better coordinated approach that any to date. Fingers crossed.
Dissident shareholders are pressing once more for the media mogul Rupert Murdoch to step down as chairman of News Corporation.
Shareholders from the US, UK and Canada filed a resolution on Tuesday, calling for News Corp to appoint an independent chairman. A similar resolution attracted strong support at the media company's annual shareholder meeting last year.
The proposal was introduced by Christian Brothers Investment Services (CBIS), which manages $4.6bn for Catholic institutions worldwide. It is backed by the UK's Local Authority Pension Fund Forum, with assets of £115bn ($178.9bn), and British Columbia Investment Management Corporation, one of Canada's largest institutional investors.
In a separate resolution, Nathan Cummings Foundation, an ethical investment group, has called on News Corp to end the dual-class share structure that allows the Murdoch family to control its media empire despite owning a minority of shares.
Rupert Murdoch must step down as News Corporation chair – shareholders [Dominic Rushe/The Guardian]
Britain's free press cringes in anticipation of coming regulation; plutocrats and oligarchs celebrate
Writing in The Spectator, Kirsty Walker describes the chilling effect the UK's Leveson Inquiry (which is investigating illegal phone/email interception and systematic harassment by UK papers, especially tabloids) is having on legitimate reporting. The UK is already the best place in the world for rich and powerful people who want to use libel law to silence unflattering accounts of their actions. But with Leveson heading for its conclusion and the spectre of official press regulation (through which the government would license reporters and news outlets, and could remove those licenses at will), reporters and their editors are under increasing pressure from the world's dictators and local plutocrats.
Before the Leveson inquiry, I had received less than a dozen PCC complaints in my career and never had one upheld. But when I left, complaints were coming in at a rate of at least one a month. All required mini-investigations. Even foreign dictatorships know how to frighten Fleet Street. The last complaint I was asked to deal with was from a dictator, the King of Bahrain, who didn’t like the way I referred to criticism of his regime following the deaths of 40 people in anti-government protests.
Like 99.99 per cent of British journalists, I never hacked a phone or bribed a public official. During my long career in the House of Commons, I tried my utmost to be fair. If a story didn’t quite stack up, I would abandon it. A small handful of journalists did hire private investigators to do some horrific things, but there are laws in this country to deal with them.
How do we know that Lord Leveson’s report will encourage the rich, the powerful, the venal and the pompous to intimidate journalists and frighten papers into not covering stories? Because the prospect of it has done so already. How do we know that an elite will attempt to decide what it is appropriate for the rest of us to read about over our cornflakes? Because Leveson is already doing exactly that. This is the judge who read a 200-word article in the Times about how The Thick of It was planning to satirise him in one episode — and promptly asked the editor of that paper whether it was ‘appropriate’ for him to run the piece. It is all too easy to guess what a judge with such an attitude to newspapers will do for press freedom.
What the papers won’t say (Thanks, Marilyn!)
The redoubtable Miss Insomnia Tulip has created a calorific tribute to the Leveson Inquiry, in which Lord Justice Leveson is interrogating the state of the nation's newspapers, phone hacking, and undue political influence. There are cakepops for all of the players in the inquiry, including one for Rebekah Brooks's LOL Blackberry.
Tom Watson and Martin Hickman's Dial M for Murdoch is a timely, informative, infuriating insider account of the News International phone-hacking scandal that has occupied the news-cycle, off and on, for several years now (and shows no sign of slowing down). Watson, a veteran Member of Parliament -- and frequent target of the Murdoch press and its hackers and snoops -- was an early and consistent voice of alarm over the scale and illegality of the Murdoch tabloids' investigative methods. He's uniquely well-situated to tell this story. His co-writer, Martin Hickman, is a veteran investigative reporter who covered the story for the Independent. They make a good pair, and the narrative is relatively smoothly told and, at times, is very powerfully written.
The Murdoch papers -- and other UK tabloids and papers -- wield tremendous influence in the halls of British power. Dial M traces the intimate connections between the press and senior ministers, elected officials, and -- crucially -- the police in the UK. As the flagship Murdoch tabloid, News of the World attained the highest circulation of any English-language paper, and seems to have led the world in illegal investigation techniques as well. The early inklings of the scope of the company's criminality were systematically understated by the press, underrated by the police, pooh-poohed by officials (from every party), and buried.
But the story wouldn't die. There were just too many victims, a sympathetic poster-child for everyone -- dead soldiers and their families, terrorist bombing victims, royals, the families of murdered children, and so on. It was impossible for Scotland Yard to maintain its "nothing to see here" posture, not with so many different stakeholders and so many upwellings of outrage. It didn't help that the most senior police officers on the case were doing various kinds of business with Murdoch, or retiring into cushy sinecures as high-paid columnists and consultants. Neither could the impotent Press Complaints Commission maintain the fiction that it had investigated, censured, and cleaned house.
Murdoch's many enemies were willing to bring the fight, risking their private lives, risking their personal fortunes. Vindictive Murdoch executives drew up enemies lists, ordered deep background checks on Parliamentarians and attorneys, sent high-powered lawyers to lean on witnesses, set private eyes to follow Murdoch's opponents in secret, or dispatched obvious PIs to watch them openly and intimidatingly. Watson and Hickman are exhaustive in documenting the slimy depths plumbed by Murdoch's high-placed lieutenants and their thugs in their efforts to maintain the years-long suppression of the investigation.
They were ultimately undone by their own arrogance. You can't defend yourself by throwing your accomplices under the bus forever. Eventually, some of the minions on whom you've pinned the blame will start whispering your secrets to others. Likewise, you can't pin the blame on your fancy lawyers, insisting that they investigated your operation and gave it a clean bill of health -- they won't sit still for it. You can't just hack everyone who accuses you of hacking.
Indeed, the scale and arrogance of the Murdoch companies' illegality was both their undoing, and is the major problem with Dial M for Murdoch. Despite the authors' valiant efforts to be both exhaustive and engrossing, sometimes the sheer litany of the names of the hacked, the officials who participated in the coverups, the bribes and corruption -- well, it gets a little repetitive. This is the banality of evil, 350 pages' worth. The fact that it's hard to keep it all straight when it's delivered in sequence, with the benefit of hindsight, tells you a lot about how this managed to slip off the front pages so many times over the years. The revelations can be so similar that it's hard to remember that this is actually a fresh outrage, not just a re-reporting of last week's lies and crimes.
My other problem with Dial M is its unwillingness to set out an explicit agenda in defense of a free press. For all that the tabloids have gotten away with murder for decades, Britain has one of the most censorious and litigant-friendly environments when it comes to press freedoms. This is the land of the "superinjunction," where corporate criminals can order the news of their misdeeds to be vanished into the memory hole. This is the land where spurious libel claims can be used to silence science writers like Simon Singh and Ben Goldacre, who document the (sometimes literally) murderous quackery of "alternative medicine" gurus. Britain has the unwelcome distinction of being the world's center for "libel tourism," a place where despots can come to punish journalists who reveal their misdeeds.
One consequence of the Murdoch scandal has been a renewal of the call for "press regulation," to rein in the tabloids. But what the tabloids did was already illegal -- it didn't just violate a "code of conduct," it violated the actual statutes on the actual lawbooks. The problem wasn't that they slipped through a legal loophole: the problem was that they had the cooperation of crooked prosecutors and cops, and the collusion of highly placed officials, both elected and appointed. The problem wasn't the absence of a law, it was the absence of legal enforcement.
For example, Dial M paints Max Mosley as something of a hero of the fight against Murdoch. Mosley, a wealthy celebrity who'd been libeled by the tabloids, refused to settle and refused to back off, and spent a fortune bankrolling much of the legal action against Murdoch. For this, he is justly lionized by the authors. But Mosley also proposes far-reaching Internet censorship rules, and advance notice and "arbitration" whenever the press publishes stories about public figures, and an opportunity for those figures to seek injunctions against publication. I kept waiting for the authors to point out that one risk of the Murdoch scandal is that Britain's moneyed and powerful will seize on the opportunity to reverse the trend toward libel reform and other free-speech rules, and to demand expansions to the already onerous censorship and libel regime the country labours under.
Instead, Watson and Hickman walk a fine line between praise and condemnation of the press, without ever articulating what a "good" press should do, or what regulation they favour. There are plenty of opportunities for this, too: after all, the Guardian's Nick Davies was a key investigator of the scandal, and the authors credit him with bringing Murdoch to heel, at real personal risk. I wanted them to explain how they would create a policy or precedent that would let Davies investigate Murdoch at full tilt, but not be so broadly defined as to legalize the investigative techniques used by the Murdoch press. Indeed, the book opens with a quote from Bob Woodward, who brought down a president by publishing illegally leaked confidential material -- what system would protect Woodward and not Andy Coulson?
The other "other shoe" that never dropped in Dial M was a critique of the way that our IT systems are designed to be such juicy and easy targets for scumbags and crooks. It goes without saying that there's no excuse for the Murdoch invasions. But what on Earth are all these rich and powerful people doing sending unencrypted emails? Why do ministers of the government use voicemail servers operated by big, dumb phone companies like Vodaphone, instead of privately maintained Asterix instances run by Parliament's IT department (who, presumably, couldn't be tricked into resetting a voicemail PIN merely by calling up and saying, "It's Bob in tech support, and I'm on the other line with the Home Secretary and she's forgotten her PIN, can you reset it for me, mate?"). How is it that lawyers and clients send cleartext documents to one another, and how is it that ministers and civil servants keep the nation's most important information on unencrypted hard drives? It's one thing for an individual celebrity (or the bereaved parents of a murdered child or a felled soldier) to lack the wherewithal to protect themselves, but when it comes to officials and their staff, it's both inexcusable and inexplicable. Maybe the Murdoch snoops would still have gotten something on them with long lenses and PIs who shadowed them from home to work. But the fact that a crew of creepy dolts were able to sit in their basements hacking thousands of important and official phones and computers at a time is not merely an indictment of their employers at the tabloids. It should be a wakeup call to the establishment to put its house in order, get some training, and use the decades-old technology (that comes stock on every GNU/Linux box) in their official dealings.
Leaving aside those omissions, Dial M is a fabulous and infuriating read. If you have been trying in vain to keep all the crooked dealings straight, here, at last, is the scorecard you've been looking for. It's the perfect background reading for the nightly news, and I can't wait for a sequel once this business has been resolved (however long that might take!).
In the wake of a UK Parliamentary committee report that described Rupert Murdoch as "not fit" to run a major corporation, a powerful US senator has reached out to the judge presiding over an inquiry into the British "phone hacking" scandal to discover whether Murdoch and his empire violated US law, too. Jay Rockefeller, chair of the Senate Commerce Committee, has asked Lord Justice Levenson "whether any of the evidence you are reviewing suggests that these unethical and sometimes illegal business practices occurred in the United States or involved US citizens." Rockefeller's committee oversees the FCC, which regulates broadcast licenses in the USA. The Guardian's Ed Pilkington and Lisa O'Carroll report:
In a scathing attack on the Murdoch company, Rockefeller writes: "In a democratic society, members of the media have the freedom to aggressively probe their government's activities and expose wrongdoing. But, like all other citizens, they also have a duty to obey the law.
"Evidence that is already in the public record clearly shows that for many years, News International had a widespread, institutional disregard for these laws."
Rockefeller also asks for details emerging from the Leveson inquiry that indicated whether any News Corp executives based in New York were aware of illegal payments made by News of the World to British police and other public officials. "I would be very concerned if evidence emerged suggesting that News Corporation officials in New York were also aware of these illegal payments and did not act to stop them."
A former Australian senator has accused News Corp -- Rupert Murdoch's media empire -- of offering to give him favorable coverage in exchange for his vote in against media legislation that would curtail the company's profits and influence. Former senator Bill O'Chee submitted a nine-page statement detailing his allegations to Australian police, who are investigating the claims.
O'Chee, a former senator for the state of Queensland with a track record of voting against his National party's wishes, alleged the executive told him that while voting against the digital TV legislation would be criticised, "we will take care of you".
The executive "also told me we would have a 'special relationship', where I would have editorial support from News Corp's newspapers, not only with respect to the … legislation but for 'any other issues' too," O'Chee reportedly told police in his statement.
"I believed that (he) was clearly implying that News Corp would run news stories or editorial content concerning any issue I wanted if I was to cross the floor and oppose the …legislation."
A lawyer for victims of News of the World phone hacking told the court that long after NotW knew of the police investigation of its newsgathering process, it put reporters' laptops and hard-drives "through a grinder" and took them out and "smashed them up."
The destruction of the computers is understood to have taken place around October last year, prior to the launch of Operation Weeting, the London Metropolitan Police investigation into phone hacking which has led to the arrests of 16 journalists.
The shredding of hard drives would have happened long after senior executives were made aware that phone hacking had spread beyond a single "rogue" reporter.
James Murdoch, "the first Mafia boss in history who didn't know he was running a criminal enterprise"
James Murdoch has been hauled back before Britain's Parliament to answer questions about what he knew and to what extent he is culpable in the News of the World/phone hacking scandal. In the BBC clip linked below, MP Tom Watson asks Murdoch if he knows what "omerta" means (Murdoch demurs). Then Murdoch embarks on a "mistakes were made" (well, "it is regrettable that things went wrong") statement that culminates with Watson asking Murdoch if he felt a comparison between News UK and the Mafia was apt. Murdoch disagrees. Watson finishes by noting that Murdoch must be "the first Mafia boss in history who didn't know he was running a criminal enterprise." To which Murdoch replies, "Mr Watson, please."
It's quite a moment.
Following up on the contentious NewsCorp shareholder meeting where the independent shareholders were to express their displeasure with the crimes committed on the Murdoch family's watch: the majority of the independent shareholders voted against continuing James and Lachlan Murdoch (Rupert's sons) continuing employment as senior execs in the company. Due to NewsCorp's odd structure the Murdochs get to overrule their shareholders, but if the upcoming shareholder meeting for BSkyB goes the same way, it will see some serious Murdoch tail-kickage.
Michael Wolff, Murdoch biographer and author of The Man Who Owns the News, said it was now inevitable that James Murdoch would leave.
"James will probably go by himself, that's what everybody will be waiting for. I wonder too if Lachlan will step off the board. But could this drag on for another year? Yes."
Wolff said the size of the vote against Murdoch's son had created "a very difficult family moment..."
Tanner said the votes against the Murdoch sons and Bancroft showed shareholders were serious about wanting more independence at News Corp. "The overwhelming influence of the Murdoch family is not acceptable anymore," she said.
Tom Watson to attend NewsCorp board meetings with "details of previously undisclosed surveillance methods"
Tom Watson, the Labour MP who's tirelessly hounded Murdoch's News of the World over its illegal spying, has flown to the USA to attend the NewsCorp's shareholder meeting (he's got the AFL-CIO's proxy) to reveal that NewsCorp's sins go much deeper than the odd bit of mass-scale crude voicemail hacking. This is a pretty plausible allegation -- the idea that a firm as ruthless and moneyed as NewsCorp would stoop to voicemail hacking but stop there is pretty implausible. I assume that the leaker(s) who are releasing the intelligence about NewsCorp's misdeeds are timing their revelations to ensure that Rupert and his progeny twist and writhe as much as possible, coming up with new, more dire revelations every time the Murdochs appear to have settled things -- ideally these revelations should also reveal the previous round of spin as a pack of half-truths, twisted truths and outright lies. And ideally, each fresh revelation will inspire more leakers to come foreward.
NewsCorp has an odd corporate structure that gives control over the company to the Murdochs, even though they don't own the majority of shares. As activist shareholders begin to mobilize, the possibility of the Murdochs being chucked out of NewsCorp becomes more and more real.
Watson has flown to Los Angeles to attend the shareholders meeting, which he will gain access to having been given a proxy vote by the US trade union umbrella group, the AFL-CIO. News Corporation is bracing itself for independent shareholders to vote in considerable numbers at the meeting against the reappointment of Rupert Murdoch and his sons, James and Lachlan, in the wake of the phone-hacking scandal.
The scale of the protest outside the Murdoch family is expected to be substantially over 20% of independent shareholders, with several expected to raise questions at the meeting at Fox studios. But their protest will not be enough to topple the family, because Rupert Murdoch controls 40% of the voting shares.
Nevertheless, before the meeting there were clear signs of tension at the upper levels of News Corp, with particular emphasis on security at the event and worries about what sort of tone the 80-year-old media mogul will strike in front of those who, alongside him, have a stake in the empire he built.
Murdoch's opening address is expected to show less of the contrition than in London in July, when he told MPs: "This the most humble day of my life." Instead he is expected to strike a more combative tone, although there are worries that this will alienate some investors and outsiders.
UK Labour Party wants journalism licenses, will prohibit "journalism" by people who are "struck off" the register of licensed journalists
The UK Labour party's conference is underway in Liverpool, and party bigwigs are presenting their proposals for reinvigorating Labour after its crushing defeat in the last election. The stupidest of these proposals to date will be presented today, when Ivan Lewis, the shadow culture secretary, will propose a licensing scheme for journalists through a professional body that will have the power to forbid people who breach its code of conduct from doing journalism in the future.
Given that "journalism" presently encompasses "publishing accounts of things you've seen using the Internet" and "taking pictures of stuff and tweeting them" and "blogging" and "commenting on news stories," this proposal is even more insane than the tradition "journalist licenses" practiced in totalitarian nations.
I'm all for hanging up Murdoch and his phone hackers by their thumbs, but you don't need to license journalists to get that done: all you need to do is prosecute them under existing criminal statutes. In other words, the only "journalism code of conduct" the UK needs to avert another phone hacking scandal is "don't break the law." Of course, it would help if government didn't court favour with the likes of Murdoch, as was the case under Labour (and is the case with today's Tories).
For a party eager to shed its reputation as sinister, spying authoritarians, Labour's really got its head up its arse.
Lewis will suggest that newspapers should introduce a system whereby journalists could be struck off a register for malpractice. And he will question David Cameron's reluctance to explain why he made Andy Coulson, the former News of the World editor, his communications director both in opposition and then in government. He will say: "I believe in second chances too. So, isn't it time you and George Osborne came clean about Andy Coulson?"
Clive Goodman, the News of the World royals reporter who resigned in disgrace, wrote a letter to News International's HR department four years ago asserting that the editorial staff of the NoTW knew about the phone hacking, that it was discussed at editorial meetings, and that Andy Coulson -- UK Prime Minister David Cameron's ex-media advisor -- was active in these discussions. It also calls into question Rupert and James Murdochs's testimony to Parliament that they hadn't been aware of the practice.
Goodman then claims that other members of staff at the News of the World were also hacking phones. Crucially, he adds: "This practice was widely discussed in the daily editorial conference, until explicit reference to it was banned by the editor." He reveals that the paper continued to consult him on stories even though they knew he was going to plead guilty to phone hacking and that the paper's then lawyer, Tom Crone, knew all the details of the case against him.Phone hacking: News of the World reporter's letter reveals cover-up (via Reddit)
In a particularly embarrassing allegation, he adds: "Tom Crone and the editor promised on many occasions that I could come back to a job at the newspaper if I did not implicate the paper or any of its staff in my mitigation plea. I did not, and I expect the paper to honour its promise to me." In the event, Goodman lost his appeal. But the claim that the paper induced him to mislead the court is one that may cause further problems for News International.
Many in the Labour Party have believed ever since that Cecil King was conspiring with members of MI5 to destroy the democratically elected government, but there appears to be no hard evidence for this.EVERY DAY IS LIKE SUNDAY (Thanks, Ben!)
The truth is that King was in league with more familiar "rogue elements" - senior City of London bankers, including the Governor of the Bank of England, who wanted to force the Labour government to slash the financial deficit. But the Prime Minister, Harold Wilson, was refusing to bow to their demands.
At the same time as this was happening, many of the journalists in Fleet Street were filled with a terrible doom about the future of newspapers. As a result the BBC got excited and went and made all sorts of films about newspapers - recording Fleet Street before it died. Some of the material they filmed is just wonderful - it is full of both touching and silly moments of an old world of journalism.
"When Myler and Crone first turned up, my knowledge was novice-level," he says. "I knew about three facts. But what I knew was that in any great scandal, you've got to follow the money. They were hick, amateur questions: I think I opened with: 'When did you tell Rupert Murdoch [about the payment]?' I thought that you might as well start at the top.Tom Watson: 'Phone hacking is only the start. There's a lot more to come out'
"They said: 'Oh no – we didn't tell Rupert Murdoch.' Then it was, 'Well, who did you tell? Who authorised it?' Myler got frustrated me with me, because I came back to this four or five times. He ranted. And don't forget: Crone had already tried to get me off the committee. So at that point, I thought: 'You're rude, you've tried to remove me from this committee, you've put me under extreme pressure for a number of years – there's more to this, and I'm getting to the bottom of it.' "When Myler was so over the top . . . it was like there was a big neon light behind his head, saying, 'Dig here.'"