Murdoch abandons BSkyB bid in rare business defeat
Rupert Murdoch withdrew his bid to takeover British Sky Broadcasting as political and public outrage over the phone-hacking scandal involving his tabloids soars.
Over the past few days, the BSkyB bid became the symbol and rallying point against the excesses of the British tabloid culture with which Mr. Murdoch, whose News of the World (NotW) tabloid is at the center of the hacking investigation, is synonymous.
The withdrawal is being seen as something of a public humiliation for the octogenarian billionaire who is alternately known as media baron, shrewd operator, kingmaker, and despot. And until the Guardian revealed that NotW broke into the voicemail a 13-year old murdered girl, Murdoch often wielded enormous political power in Britain through fear.
Murdoch's decision to back away from the BSkyB deal may come down to his aversion to testifying in investigations about the invasive and allegedly illegal practices of his tabloids, and to keep his son, James Murdoch, and other News Corp officials off the stand, too, according to analysts.
Earlier today, Tom Crone, who was legal counsel for Murdoch's British newspapers, said he was leaving the firm. Mr. Crone is known as a respected professional who worked on Saturdays and vetted stories for NotW and the Sun, Murdoch's other British tabloid.
Murdoch's BSkyB decision is also seen as compelled by the fact that he suddenly has few political allies able to open doors.
British Prime Minister David Cameron, who had until last week sided with News Corp, said in Parliament today that a “robust” public investigation of police, the press, and some 3,870 individuals whose phones were hacked will not spare the executives of media companies.
Mr. Cameron, whose stature has suffered terrifically since the Guardian exposed that Milly Dowler's voicemail was tampered with, has been distancing himself from the media mogul.
“No matter how high or how low they [media professionals] are ... there is no future role in running a media company in our country,” Camerson said today in a spirited House of Commons discussion ahead of a planned motion to request Murdoch withdraw his BSkyB bid.
Labour leader Ed Miliband, whose stature has risen as the leading advocate to pursue the tentacles of the explosive scandal, claimed today that Murdoch’s decision was a victory for the British people: “It is a victory for people up and down this country … [they] have said ‘thus far and no further.' "
Pulling the plug on the BSkyB bid is also a rare business defeat for Murdoch, especially considering that he may have shuttered the 163-year-old NotW on the assumption that it would help his chances to acquire the broadcasting company. Murdoch currently owns 39 percent of the satellite TV concern and appeared set to own the final 71 percent until the scandal broke. News Corp stock value has dropped some $5 billion in a week.
It's unclear whether Rupert and James Murdoch and Rebekah Brooks, the loyal Murdoch executive who edited NotW at the time many of the phone hackings took place, will agree to be questioned in a Parliament-established committee next Tuesday. They are compelled to respond to an invitation today.