Above is a link to the BBC’s timeline of a scandal that had been brewing for a decade and has led to the closing of News of the World, a British tabloid. The News of the World had been in print since 1843 and was reported to be, prior to its closing, the most widely read English language newspaper in the world. Rupert Murdoch’s New Corporation acquired the tabloid in 1969. This scandal has also led to the scuttling of Mr. Murdoch’s bid to buy out the remaining shares of BSkyB. BSkyB is one of the UK’s largest, and most profitable television networks. News Corp. currently owns a nearly 40% stake in BSkyB.
The recent revelations of phone hacking and police bribery by News of the World editors and employees have created a furor that has seen one of the most powerful men in British media rendered almost a pariah. And now the BBC has issued this report that the leader of the Labour party, David Miliband, is calling for limits to be placed on Mr. Murdoch’s media empire.
Born in 1931 the son of a local newspaper magnate, Mr. Murdoch took over the family business at the age of 21 upon his father’s death. He has since grown a media empire that includes the Fox family of networks in the United States, Sky Italia in Italy, Star TV in India and China, The Times newspaper in the UK, the Wall Street Journal and the New York Post in the United States, as well as dozens of other print and broadcast outlets around the world. Forbes magazine has estimated his personal wealth in 2011 to be $7.6 billion.
Despite this global media empire and vast personal fortune, it appears Mr. Murdoch may not be able to fully recover personally or professionally from this debacle. At 80 years old, Mr. Murdoch may not be at the helm of News Corp much longer. News Corp. stock has been stagnant for the past half-decade and just sold most of its stake in MySpace for $30 million. News Corp. had purchased MySpace just six years ago for $580 million.
Mr. Murdoch has made a public apology for the alleged transgressions, but it is seen by some as too little, too late as he tried to save his own skin and that of his son, who took over News Corp’s European division as these scandals were just coming to light. Perhaps more will be reveled on Tuesday as Mr. Murdoch and his son are set to appear before Parliament.
Update 18 July:
There are conflicting reports about the immediate future for both Mr. Murdoch and News Corp. Some outlets are reporting Mr. Murdoch may resign as CEO of News Corp. (no word on whether he would also resign as Chairman) but other outlets are reporting that the News Corp. board of directors is firmly behind Mr. Murdoch and his leadership team. News Corp. stock (NWS) was down $0.69 (4.29%) in regular trading today, but has gained back $0.11 (0.71%) in after-hours trading.
Update 23 July,
Well Mr. Murdoch’s testimony before Parliament didn’t go exactly as planned. After narrowly avoiding getting a shaving cream pie to the face, Mr. Murdoch proceeded to place the blame for News of the World’s misdeeds on subordinates and said that he was probably the best person for the job of cleaning up the mess. Still no word on whether or not succession plans are being put in place.