Rupert Murdoch vs. the Gray Lady
Rarely have Americans been given such a vivid and unsavory insight into British journalism as the one that greeted New York Times readers on September 1. "Tabloid Hack Attack on Royals, and Beyond" ran for 6,000 words across multiple pages. Two of the three bylines were of former Pulitzer winners, Don Van Natta and Jo Becker.
The meat of this supersized story was quite juicy. Reporters at the News of the World, a sex- and scandal-laced Sunday tabloid owned by media tycoon Rupert Murdoch, had been routinely eavesdropping on the private conversations of celebrities. They were aided by a private investigator on the paper's payroll, Glenn Mulcaire, who had managed to obtain the PIN codes needed to access voicemail on mobile telephones. London police were able to prove that Mulcaire and News of the World reporter Clive Goodman were illegally hacking into the voicemail of members of Britain's royal family and their inner circle. Both men were later sentenced to several months in prison, and dismissed from the paper. News of the World editor Andy Coulson also resigned, while denying knowledge of the phone hacking rampant under his watch.
The New York Times asked why Scotland Yard, as the headquarters of London's Metropolitan Police is generally known, had investigated only a handful of the 2,978 mobile numbers and 91 PIN numbers they found at Mulcaire's home. Scotland Yard claimed it had been too busy safeguarding the public from terrorist attacks. According to other sources, however, the Yard wanted to protect its cozy ties to Murdoch's London papers.
The NYT also suggested that Murdoch could count on political favors. Since the late 1970s, he has used his London papers – which also include The Sun, a mass-circulation daily tabloid, as well as The Times and Sunday Times upmarket broadsheets – to support a conservative, pro-business line. Margaret Thatcher's Conservatives partly owed their election success to Murdoch press endorsements – a lesson taken to heart by Tony Blair, who assiduously courted Murdoch after he led Labour to victory in 1997. When Murdoch later switched party allegiance, the Conservatives rescued Coulson from disgrace by inviting him to help plot their campaign for the 2010 general election. His reward was to become the official media advisor to Prime Minister David Cameron.
OLD BUT STILL POTENT NEWS
The odd thing was, the story in question was over five years old. Until The New York Times applied its prodigious bellows, the British phone-hacking scandal was just a glowing ember, kept alight largely through the persistence of The Guardian, a left-leaning British broadsheet.
After the NYT story on Sept. 1, however, it roared into flame. Politicians whose mobile numbers were among the 2,978 found at Mulcaire's house loudly demanded a full police investigation, though whether they were moved by moral indignation or the prospect of substantial payment from Murdoch's U.K. newspaper holding company, News International (one victim cited by The New York Times received a £700,000 [¥92.6 million] settlement), is open to debate.
Labour, now in opposition, made hay as Cameron was compelled to voice "full confidence" in the embattled Coulson. On Sept. 15, the eve of Pope Benedict XVI's arrival in Britain, there were even reports that the proposed ¥1.6 trillion takeover of British satellite broadcaster BSkyB by Murdoch's News Corp. may be in jeopardy as a result of the scandal.
The New York Times intervention raises two big questions. First, was the British "political class" – to use the revealing British term for the small group of people normally active in national politics – incapable of cleaning out its own stable without an exposé in the foreign media?
Amid the torrent of reader comments The New York Times published, many expressed shock at the odor of corruption, emanating especially from Scotland Yard, for which Americans still seem to hold chaste associations of dim but always upright London police. Blame Sherlock Holmes and Hercule Poirot.
Second, and more crucially, why was The New York Times so concerned about a British scandal dating back several years, to the point of flying two of its top investigative reporters to London? (Back in July, the satirical British magazine Private Eye reported: "Two New York Times hacks have been holed up in a hotel in London for the past three months investigating goings-on at Murdoch's News of the World. . . .")
The New York Times refuted this. "They were not there for several months," NYT spokeswoman Diane McNulty told me. "They made a couple of trips over a period of several months."
There is no shortage of stories more directly relevant to Americans, of course, including the intractable war in Afghanistan, a domestic unemployment rate of nearly 10 percent, and a right-wing political rebellion directed at America's first non-white president.
The answer lies in the venomous relationship between The New York Times and Rupert Murdoch. At least in print, journalists of the American paper remain more polite than some of its readers, for whom Murdoch is "sleazy" and a "slimeball," "slithering his way through the halls of power," or simply a "flea-bitten rodent."
But only just. Listen to Frank Rich, one of The New York Times highest-octane columnists, who blames "the Rupert Murdoch axis of demagoguery" for stirring up a paranoid backlash against the planned community center-cum-mosque near Ground Zero in Manhattan – actually, nearer to betting shops and strip clubs than the ground of the Twin Towers – from "the Islamophobia command center, Murdoch's News Corp."
The real friction comes from the combination of an old-fashioned, do-or-die, take-no-prisoners battle for circulation between The New York Times and Murdoch's Wall Street Journal, and an elemental struggle for political power in America.
Murdoch started it all in 2007 when he paid the Bancroft family an astonishing $5 billion for the dowdy Wall Street Journal. He proceeded to clean out the cobwebs, and many of its staff, and installed a loyal Australian henchman, Robert Thomson, as managing editor.
Thomson had been editor of The Times in London. From 1989 to 1994, he was Tokyo correspondent for the Financial Times. Like Murdoch, Thomson has a Chinese wife, the daughter of a general in the People's Liberation Army. Murdoch and Thomson soon let it be known that they had The New York Times in their sights; the clearest sign was the launch this year of a New York metro edition of the Wall Street Journal.
Until then, The New York Times had regarded Murdoch with patrician disdain. He began small in the United States, with a regional newspaper and a supermarket tabloid, before acquiring the venerable New York Post and moving into film and broadcasting. With rueful hindsight, New York Times executives realized he was employing the same expansion strategy as he had in Britain.
HUNGRY FOR A BIGGER SLICE
The difference between the 1980s and the 1990s was the Internet. Print media are in decline, and newspapers are struggling to retain their share of a shrinking pie. At the end of 2008, the Tribune Company, owner of the Los Angeles Times, Chicago Tribune and Baltimore Sun, filed for bankruptcy, and in January 2009 there was panicked speculation that The New York Times was on the brink of closure. "Saddled with debts, crippled by the cost of the new building and of running one of the most expensive news operations on earth, some believe the Times is running on empty," The Observer of London reported that month.
Financially, there could be no contest with Murdoch. The New York Times was a David confronting Goliath (see boxes).
"Nationally, there's no contest now. We're more than twice as big as The New York Times," Thomson bragged recently. "They’re not a serious competitor."
But if Murdoch thought the most respected newspaper in the world was about to wave the white flag, he was badly mistaken. Instead, The New York Times has bounced back off the ropes and is punching harder than ever before. Its columnists, who include the Nobel economics laureate Paul Krugman, speak out with vigor and passion for liberal values, and for a president who usually prefers to be serenely mute. For reticent Brits, the gall can be breathtaking. The headline for Maureen Dowd's caustic review of Tony Blair's new autobiography was "The Poodle Speaks."
The call to arms would be less resonant if journalists were merely fighting for their lunch. But by infusing ideology into the fight, bankrolling the Tea Party insurgents who are pulling the Republicans toward the right, and training the guns of Fox News and the Wall Street Journal on the Obama White House, Murdoch has galvanized his opponents and turned a newspaper war into a liberal crusade.
It is much too early to foresee the outcome. Murdoch must be hoping that the U.S. Senate elections will be a train crash for Obama and the Democrats. Another media mogul, Michael Bloomberg, is said to be pinning his hopes on the Republican nomination for president, triangulating himself as a moderate alternative to Tea Party Mad Hatters.
STILL THE CONTENT KING
There is another dimension to The New York Times-Murdoch war that goes beyond Obama, Democrats and Republicans, and the babble in which executive editors like to indulge about Internet paywalls and leveraging multiplatform synergies. That is the growing global demand for English-language newspaper content outside of North America, the U.K., or Australasia. Outside of business news, where there is fierce competition, The New York Times reigns supreme, thanks to its alliances through the International Herald Tribune, which it has owned outright since 2002.
In some cases, one can imagine local partners valuing the prestige of The New York Times more than its politics or commitment to free speech. They would likely feel more comfortable in the conservative corporate embrace of Murdoch and the Wall Street Journal.
Here's one example that illustrates why. This past April, The New York Times published a report from Seoul about a book that "makes sensational allegations of extensive corruption by Lee Kun-hee, the richest man in South Korea and the chairman of Samsung Electronics, the world's largest technology company by revenue."
The New York Times' partner in South Korea is the Joong-ang Daily, the English-language version of the Samsung-affiliated Joong-ang Ilbo. I am informed that Korean editors at the Joong-ang were aghast when the Samsung story appeared on the front page of the IHT.
What of Coulson and the phone-hacking scandal? As I write, all is strangely quite once again. The Pope's visit to Britain, organized by Chris Patten, the last British governor of Hong Kong and a Roman Catholic, kindled a strange religious fervor among the British media, who for a few days became almost pietistic, forgetting all about Henry VIII and Elizabeth I, priestly pedophiles and pederasts. It reminded me that propaganda originated in the Roman Church, in the seventeenth-century Congregatio de Propaganda Fide for rolling back the Protestant heresy. What Coulson is now up to, and whether he is busy practicing the dark arts on behalf of David Cameron, I have no idea. If only I could eavesdrop on his phone…
MURDOCH'S GROWING EMPIRE
RUPERT MURDOCH IS CHAIRMAN AND CEO OF NEW YORK-BASED NEWS CORP., the holding company for his media empire. News Corp. has a market capitalization of $36.2 billion, and as of June 30 had total assets of about $54 billion and annual revenue of $33 billion.
James Murdoch, one of Rupert's sons, is chairman and CEO of News Corp. for Europe and Asia, as well as CEO of News International (publisher of The Times, Sunday Times, Sun, and News of the World).
News Corp.'s main assets:
Newspapers & wires: The Wall Street Journal and Dow Jones, New York Post, The Times, The Sunday Times, The Sun, The News of the World, The Times Literary Supplement, The Australian, plus about 100 local newspapers in Australia.
TV & radio: Fox Broadcasting, Fox Sports, Fox TV stations, 20th Century Fox Television, Fox News Channel, Fox Cable Networks, FSN, FX Networks, British Sky Broadcasting (39 percent), Foxtel (Australian pay TV-equity share), Sky Italia.
Book publishing: HarperCollins
Film entertainment: 20th Century Fox, Fox Searchlight Pictures, Fox Television Studios, Fox Studios Australia
Internet: Web properties owned by News Corp. through its Digital Media Group include MySpace, Photobucket, IGN, Rotten Tomatoes, and AskMen
THE NEW YORK TIMES
THE MARKET CAPITALIZATION OF THE NEW YORK TIMES CO. IS $1.2 BILLION.
In 2009, it had revenues of $2.4 billion.
The New York Times, The Boston Globe, 15 regional newspapers, 50 websites, including About.com, and The International Herald Tribune.
In 2002, The New York Times bought out the Washington Post's share in the International Herald Tribune, which is now termed the "Global Edition of The New York Times." The NYT-owned IHT also has alliances with other newspapers, which publish their own English-language versions inside the IHT. "They have no input at all in IHT content," according to NYT spokesperson Diane McNulty. The global partners of the IHT are:
Asahi Shimbun (Japan), Joong-Ang Daily (South Korea), The Moscow Times (Russia), El Pais (Spain), Haaretz (Israel), Daily News Egypt (Egypt), Express Tribune (Pakistan), Al Watan Daily (Kuwait), Kathimerini (Greece)
Peter McGill writes for Asiamoney magazine, and is a former president of the FCCJ.