Update: Murdoch drops BSkyB bid.
Rupert Murdoch’s problems with the News of the World and his bid to buy the rest of British Sky Broadcasting (BSkyB) are but the latest examples of how media barons are inclined to overreach themselves. Their frenetic efforts to grow ever bigger often lead not just to excess, but to collapse.
Examples include Robert Maxwell, the Czech-born British publishing tycoon who died, apparently a suicide, by falling from his yacht while cruising off the Canary islands. He’d risen from poverty to become the lord of the London Daily and Sunday Mirror, the New York Daily News, and the publisher Macmillan. After his death it was revealed he’d looted the company pension plan for money to shore up the shares of his company.
The exploits of Canada’s own Lord Black are well-known. He lost Hollinger International, which included the London Telegraph, the Jerusalem Post, and a chain of Canadian papers including his start-up, the National Post. In September, he’ll go back to jail to finish his prison term for fraud and obstruction of justice.
One of the biggest media barons of all was William Randolph Hearst, whose newspaper, magazine and broadcasting empire ruled American society and politics through much of the first half of the 20th century. Most famously remembered for his role in promoting the Spanish-American War of 1898, his early life has been chronicled by Ken Whyte, the first editor of Black’s National Post, in The Uncrowned King (Random House Canada). Today’s Hearst Corp. is still a force in American media, although incomparably less influential than during Hearst’s lifetime.
Interest in Rupert Murdoch is of course sparked by the scandal over his late and unlamented News of the World. This episode is turning out to be as damaging to the British political establishment as it is to Murdoch’s hopes of expanding his empire by the full acquisition of the UK’s most profitable satellite broadcasting service. It reveals a society of craven political operatives in both the Conservative and Labor parties who begged at Murdoch’s knees for his support.
Because the current Prime Minster David Cameron won that support, and even hired a former News editor as his spokesperson, he’s the one who is in almost as much trouble as Murdoch. It’s no surprise that Cameron is backing a Labor party motion urging Murdoch to withdraw his BSkyB takeover proposal.
Ever the resourceful player, Murdoch has taken some desperate steps to protect his interests. He’s opted for a longer review of his take-over bid by the UK Competition Commission. This means a closer examination, but also one that gains time for the current scandal to die away. And he’s set aside 5 billion pounds to buy back NewsCorp shares, thereby strengthening their market value; this may help to quiet a group of dissident shareholders.
For all of Murdoch’s embarrassments, his biggest problem could be these same shareholders. A group has sued his NewsCorp, accusing it of large-scale governance failures that allowed the phone hacking scandal in the first place. It was unhappy shareholders, one should recall, who triggered the events leading to Lord Black’s downfall.
The seasoned American writer Michael Wolff dissects Murdoch’s life and personality in The Man Who Owns the News (Broadway Books). Murdoch, an Australian, has for years been the pre-eminent global media baron, with operations all over the world. His American properties include the Wall Street Journal and the tabloid New York Post, plus FoxTV. He would probably be in Canada but for our legislation which prevents foreign media ownership.
It was Murdoch’s acquisition of the venerable London Times, Wolff writes, “that turned him from a vulgarian operating at the margins of the business into, well, a threat to truth.” In America, Wolff adds, his take-over of the Wall Street Journal “is the ultimate fuck-you to the people who have always believed they embody respectability.”