News Corp. takes a major hit

The phone-hacking scandal has actually hurt Rupert Murdoch:

News Corp. dropped its bid to take full control of British Sky Broadcasting Group PLC, as a political firestorm ignited by reporting tactics at one of its U.K. newspaper titles upended the company’s strategic ambitions and delivered a blow to its influence in Britain.

News Corp. pulled the plug on the deal hours before a vote in which U.K. Prime Minister David Cameron’s Conservative Party lined up to support a motion by the opposition Labour Party urging the company to abandon the bid.

That report is from the Wall Street Journal, Murdoch’s respectable paper in the U.S.

Murdoch’s political cronies are running scared, too. Today’s Prime Minister’s Questions hour in Parliament saw something you’d never expect: The Conservatives, whom Rupert essentially put in power, turning against him. Here’s Ed Miliband, the Labour leader, blasting David Cameron and his ties to News Corp.:

So, it turns out Rupert did crap in the food one too many times.

But as we look at the people now standing up to News Corp., let’s not forget that others had been sticking their necks out in criticizing the company and its practices.

Nick Davies at the Guardian has been covering illegal activities at News Corp. for years, and most of the time, no one paid attention to what he was writing.

— The New York Times did the first comprehensive piece on the scandal in the U.S. in its magazine last September.

— Hugh Grant, the actor, wired himself in April and taped a News Corp. investigator who admitted hacking was pervasive in the company and went to the top.

— Even Jon Stewart, of the Daily Show, has been in a battle with Fox News over the dubious practices of that News Corp. unit.

But others are speaking now, who should just do us all a favor and keep their mouths shut:

A number of key members of the family which controlled The Wall Street Journal say they would not have agreed to sell the prestigious daily to Rupert Murdoch if they had been aware of News International’s conduct in the phone-hacking scandal at the time of the deal.

“If I had known what I know now, I would have pushed harder against” the Murdoch bid, said Christopher Bancroft, a member of the family which controlled Dow Jones & Company, publishers of The Wall Street Journal. Bancroft said the breadth of allegations now on the public record “would have been more problematic for me. I probably would have held out.” Bancroft had sole voting control of a trust that represented 13 percent of Dow Jones shares in 2007 and served on the Dow Jones Board.

Now the Bancrofts were a bunch of heirs to the Dow Jones fortune whose only interest in the company was raking in the big dividend checks every year. One of the reasons Dow Jones was vulnerable to a takeover was because of their lack of interest in anything other than their stock holdings and their regular company checks. When they sold to Rupert, they were vilified. But they made a killing. They got $5 billion for a company that News Corp. eventually had to write off a couple of billion for because it was a bad deal. The Bancrofts will parrot the line that had they known what News Corp. was capable of, they never would have sold, but let’s face it. You’re not going to see them make an offer to buy the company back, even at the now discounted price.

They just need to shut up and count their money.

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