Monday, January 24, 2011

MURDOCH; Criticism and controversy

Rupert Murdoch

2008/9 Schools Wikipedia Selection. Related subjects: Producers, directors and media figures

Keith Rupert Murdoch

Rupert Murdoch, August 2006
Born11 March 1931 (1931-03-11)
Flag of Australia Melbourne, Australia
OccupationChairman and CEO, News Corporation
Net worth$7.7 Billion
Spouse1) Patricia Booker (1956 - 1967), one daughter Prudence;
2) Anna Tõrv (1967 - 1999), one daughter Elisabeth and two sons Lachlan and James;
3) Wendi Deng (1999 - present); two daughters Grace and Chloe
Keith Rupert Murdoch, AC, KCSG (born Melbourne, March 11, 1931), usually known as Rupert Murdoch, is an Australian-American global media tycoon. He is the major shareholder, chairman and managing director of News Corporation (News Corp). Beginning with newspapers, magazines and television stations in his native Australia, Murdoch expanded News Corp into the UK, US and Asian media markets. In recent years has become a leading investor in satellite television, the film industry, the Internet and media. News Corp is based in New York.
According to Forbes Magazine, Murdoch is the 32nd wealthiest American with a networth of $7.7 billion.


Early life and family

Murdoch is the son of a powerful Australian newspaper proprietor, Sir Keith Arthur Murdoch. He attended Geelong Grammar, one of Australia's most elite private schools and was reading philosophy, politics and economics at Worcester College, University of Oxford, England, when his father died in 1952.
Before his death, Keith Murdoch had accumulated a great number of shares in newspaper companies, including some representing a controlling interest in News Limited, an Adelaide company publishing an afternoon newspaper called The News. He had appointed an experienced journalist named Rohan Rivett, a childhood friend and mentor of Rupert Murdoch, as editor of The News, with the hope that Rupert would enter a career in journalism and that Rivett would assist Rupert in learning the required skills. In his will, Keith Murdoch instructed his trustees that Rupert should begin his career at The News: "if they consider him worthy of support". At that time of his father's death, Murdoch had written articles for Oxford student newspapers and had worked for a number of newspapers in a junior capacity. Some thought he had little interest in journalism though and noted his enthusiasm for gambling and making money. At the time of his death Keith Murdoch was heavily in debt, but possessed within a private family trust a considerable number of newspaper shares, some of which may have actually belonged to The Herald and Weekly Times Ltd. The trustees, in consultation with Keith's widow and Rupert's mother, Lady Elisabeth Murdoch, were forced to sell many of the shares and other property in order to repay debt and death duties (government taxes). Elisabeth was able to retain only the family home, Cruden Farm, and the shares in News Limited and its subsidiaries, a Melbourne magazine publishing company named Southdown Press and The Barrier Miner, a regional newspaper at Broken Hill, New South Wales.

Start of business career

Rupert Murdoch returned from Oxford to become managing director of News Limited in 1953. His drive and energy infected the staff and the circulation and advertising revenue began to grow. He began to direct his attention to acquisition and expansion. He bought the Sunday Times in Perth, Western Australia and, using the tabloid techniques of Lord Northcliffe, made it a success.
In 1956, Murdoch began publishing Australia's first and most successful weekly television magazine, TV Week, at Southdown Press in Melbourne, which also published Australia's oldest women's magazine New Idea. With the Perth paper, the TV magazine and a re-energised New Idea all providing a steady and improving cash flow he was able to obtain finance for more expansion from the Commonwealth Bank of Australia, a government-owned bank dedicated to supporting Australian business development.
A defining moment in Murdoch's life was the Stuart case in Adelaide when The News began a campaign to free Max Stuart, a young Aboriginal carnival worker, who had been convicted of the murder of a small girl on a beach near Ceduna, South Australia in late 1958. Stuart had been sentenced to death by hanging. The News was openly critical of the case and investigated it extensively. The death penalty was eventually commuted to life imprisonment.
The campaign by The News raised the ire of the Premier of South Australia, Sir Thomas Playford. He established a royal commission, conducted by the state's Chief Justice, the same judge who had passed sentence on Stuart. The outcome was a confirmation of Stuart's guilt and a recommendation that News Ltd (of which Murdoch was managing director) and its editor be charged with nine counts of seditious libel, a form of treason based on medieval English law, and criminal libel. Eight of the charges were thrown out, but the jury could not agree on the ninth, which the prosecution subsequently withdrew. This experience gave Murdoch a taste of the overwhelming power of popularly elected politicians and would shape the future policies of all his newspapers. (In 2002, he financed a motion picture Black and White, a fictionalised version of the Stuart story.) Shortly after the case, Murdoch replaced Rivett as editor of The News.
Over the next few years, Murdoch established himself in Australia as a dynamic business operator, expanding his holdings by acquiring suburban and provincial newspapers in New South Wales, Queensland, Victoria and the Northern Territory. including the Sydney afternoon tabloid, The Daily Mirror, as well as a small Sydney-based recording company, Festival Records. His acquisition of the Daily Mirror allowed him to challenge two powerful rivals in Australia's biggest city and to outwit his afternoon rival in a long circulation war.
In 1964, Murdoch launched The Australian, Australia's first national daily newspaper, based first in Canberra and later in Sydney. The Australian, a broadsheet, was intended to give Murdoch a new respectability as a 'quality' newspaper publisher and greater political influence. The paper had a rocky start, marked by publishing difficulties and a constantly changing succession of editors who found it impossible to deal with Murdoch's persistent interference. Promised as a serious journal of the affairs of the nation, the paper actually veered between tabloid sensationalism and intellectual tedium until Murdoch was able to find a compliant editor who could abide with his often unpredictable predilections.
The departure in 1966 of the Liberal Prime Minister Robert Menzies saw a chaotic six years of politics after Menzies' chosen successor Harold Holt drowned, to be replaced by John Gorton and then William McMahon. In 1972, Murdoch acquired the Sydney morning tabloid The Daily Telegraph. In that year's election, Murdoch threw his growing power behind the Australian Labor Party under the leadership of Gough Whitlam and duly saw it win power. As the Whitlam government suffered a great loss of public support following its 1974 re-election, Murdoch soon turned against Whitlam and supported the Governor-General's dismissal of the Prime Minister.
During this period, Murdoch turned his attention overseas. His business success in Australia and his fastidious policy of prompt periodic repayments of his borrowings had placed him in good financial standing with the Commonwealth Bank and he obtained its support for his biggest venture yet, the takeover of a family company which owned The News of the World, the Sunday newspaper with the biggest circulation in Britain.

Building the Empire

Acquisitions in Britain

Murdoch expanded to Britain in 1968. He succeeded in beating rival publisher Robert Maxwell in securing The News of the World, which had been the most popular English language newspaper in the world, claiming a peak circulation of 8,441,966 in 1950. By 1968, the circulation had dropped to around six million and a substantial number of its shares were offered for sale by a member of the Carr family, which had part-owned and managed the company for nearly seventy years.
It was also the first time Murdoch risked the whole business he had already created on the outcome of a new venture, for he mortgaged the most valuable of his existing Australian properties to buy the paper with a promise that he would share control with the existing Carr management. Upon succeeding, Murdoch not only controlled News of the World but had then completely regained full ownership of all his Australian assets.
When the daily newspaper The Sun entered the market in 1969, Murdoch acquired and converted it into a tabloid format, which by 2006 was selling three million copies per day.
Murdoch acquired The Times (and The Sunday Times) in 1981, the paper his father's mentor, Viscount Northcliffe, had once owned. The distinction of owning The Times came to him through his careful cultivation of the owner who had grown tired of losing money on the property.
During the 1980s and early 90s, Murdoch's publications were generally supportive of the UK Prime Minister Margaret Thatcher.
At the end of the Thatcher/Major era, Murdoch switched his support to the Labour Party and the party's leader Tony Blair. The closeness of his relationship with Blair and their secret meetings to discuss national policies was to become a political issue in Britain.
In 1986, Murdoch introduced electronic production processes to his newspapers in Australia, Britain, and the United States. This led to significant reductions in the number of employees involved in the printing process due to the greater role of automation. In England, the move aroused the anger of the print unions, resulting in a long and often violent dispute fought in London's docklands area of Wapping, where Murdoch had installed the very latest electronic newspaper publishing factory in an old warehouse. The unions had been led to assume that Murdoch intended to launch a new London evening newspaper from those premises, but he had kept as a surprise his intention to relocate all News titles there. Once the Wapping battle had ended, union opposition in Australia followed suit. Today, most newspapers around the world are produced using his method, with significant cost savings involved in the automation of the process.
News has subsidiaries in the Bahamas, the Cayman Islands, the Channel Islands and the Virgin Islands. From 1986 News Corporation's annual tax bill averaged around seven percent of profits.

Moving into the United States

Murdoch made his first acquisition in the United States in 1973, when he purchased the San Antonio Express-News. Soon afterwards, he founded Star, a supermarket tabloid, and in 1976, he purchased the New York Post. On September 4, 1985, Murdoch became a naturalized citizen, to satisfy the legal requirement that only US citizens could own American television stations. In 1987, in Australia, he bought The Herald and Weekly Times Ltd., the company that his father had once managed. By 1991, his Australian-based News Corp. had amassed huge debts, which forced Murdoch to sell many of the American magazine interests he had acquired in the mid-80s. Much of this debt came from his British-based satellite network Sky Television, which incurred massive losses in its early years of operation, which (like many of his business interests) was heavily subsidized with profits from his other holdings, until he was able to force rival satellite operator British Satellite Broadcasting to accept a merger on his terms in 1990. (The merged company, BSkyB, has dominated the British pay-TV market ever since.)
In 1995, Murdoch's Fox Network became the object of scrutiny from the Federal Communications Commission (FCC), when it was alleged that News Ltd.'s Australian base made Murdoch's ownership of Fox illegal. The FCC, however, ruled in Murdoch's favour, stating that his ownership of Fox was in the public's best interests. In the same year, Murdoch announced a deal with MCI Communications to develop a major news website, as well as funding a conservative magazine, The Weekly Standard. In the same year, News Corp. launched the Foxtel pay television network in Australia, in a partnership with Telstra.
In 1996, Murdoch chose to enter the world of cable news with the Fox News Channel, a 24-hour cable news station. Following its launch, the heavily-funded Fox News consistently eroded CNN's market share, and eventually proclaimed itself as "the most-watched cable news channel." This is due in part to recent ratings studies, released in the fourth quarter of 2004, showing that the network had nine of the top ten programs in the "Cable News" category. However, in recent years, its ratings have begun to decline.
In 1999, Murdoch significantly expanded his music holdings in Australia by acquiring the controlling share in a leading Australian independent label, Michael Gudinski's Mushroom Records; he merged that with Festival Records and the result was Festival Mushroom Records (FMR). Both Festival and FMR were managed by Murdoch's son James Murdoch for several years.

Expansion in Asia

Murdoch acquired Star TV from a Hong Kong company in 1993 (Souchou, 2000:28) STAR TV (Asia) and created offices for it throughout Asia, including Singapore, China, India, Pakistan, Vietnam, etc. It is one of the biggest satellite TV networks in Asia.

Recent activities

In late 2003, Murdoch acquired a 34 percent stake in Hughes Electronics, operator of the largest American satellite TV system, DirecTV, from General Motors for $6 billion (USD).
In 2004, Murdoch announced that he was moving News Corp.'s headquarters from Adelaide, Australia to the United States. Choosing a US domicile was designed to ensure that American fund managers could purchase shares in the company in circumstances where many chose not to buy shares in non-US companies. Some analysts believed that News Corp's Australian domicile was leading to the company being undervalued compared with its peers.
On July 20, 2005, News Corp. bought Intermix Media Inc., which held and other popular social networking-themed websites for $580 million USD. On September 11, 2005, News Corp announced that it would buy IGN Entertainment for $650 million (USD).
Rupert Murdoch and Ted Turner have been competitors for quite some time. In 1996 Murdoch launched the Fox News Channel to compete against Turner's CNN.
The subject of Murdoch's alleged anti-competitive business practices resurfaced in September 2005. Australian media proprietor Kerry Stokes, owner of the Seven Network, instituted legal action against News Corporation and the PBL organization, headed by Kerry Packer. The suit stems from the 2002 collapse of Stokes' planned cable television channel C7 Sport, which would have been a direct competitor to the other major Australian cable provider, Foxtel, in which News and PBL have major stakes.
Stokes claims that News Corp. and PBL (along with several other media organizations) colluded to force C7 out of business by using undue influence to prevent C7 from gaining vital broadcast rights to major sporting events. In evidence given to the court on 26 September, Stokes alleged that PBL executive James Packer came to his home in December 2000 and warned him that PBL and News Limited were "getting together" to prevent the AFL rights being granted to C7.
Recently, Murdoch has bought out the Turkish TV channel, TGRT, which was previously confiscated by the Turkish Board of Banking Regulations, TMSF. Newspapers report that Murdoch has bought TGRT in a partnership with Turkish recording mogul, Ahmet Ertegün and there are alleged reports that Murdoch has acquired Turkish citizenship to overcome the current obligations against capital sales to foreigners.

Political activities


Murdoch's shattering experience with Thomas Playford in South Australia (see above: "Start of Business Career") and his early political activities in Australia were to set the pattern he would use around the world for the rest of his life.
Murdoch found a political ally in John McEwen, leader of the Australian Country Party and governing in coalition with the larger Menzies-Holt Liberal Party. From the very first issue of The Australian Murdoch began taking McEwen's side in every issue that divided the long-serving coalition partners. (The Australian, July 15, 1964, first edition front page: “Strain in Cabinet, Liberal-CP row flares.”) It was an issue that threatened to split the coalition government and open the way for the stronger Australian Labor Party to dominate Australian politics. It was the beginning of a long campaign that served McEwen well.
McEwen repaid Murdoch's support later by aiding him to buy his valuable rural property Cavan and then arranged a clever subterfuge by which Murdoch was able to transfer a large sum of money from Australia to England to complete the purchase of The News of the World without obtaining the required authority from the Australian Treasury.
After McEwen and Menzies retired, Murdoch transferred his support to the newly elected Leader of the Australian Labor Party, Gough Whitlam, who was elected in 1972 on a social platform that included universal free health care, free education for all Australians to tertiary level, recognition of the People's Republic of China and public ownership of Australia's oil, gas and mineral resources.
Rupert Murdoch's flirtation with Whitlam turned out to be brief. He had already started his short lived National Star newspaper in America and was seeking to strengthen his political contacts there.
Asked about the Australian federal election, 2007, at the News Corporation annual general meeting in New York on 19 October 2007, its chairman Rupert Murdoch, once an Australian and now a citizen of the USA said, "I am not commenting on anything to do with Australian politics, I'm sorry. I always get into trouble when I do that." Pressed whether he believed Prime Minister John Howard should be re-elected he said: "I have nothing further to say. I'm sorry. Read our editorials in the papers. It'll be the journalists who decide that - the editors."

United States of America

In the US he has been a long-time supporter of the Republican Party and was a friend of Ronald Reagan. Regarding Pat Robertson's 1988 presidential bid, he said, "He's right on all the issues." Many Christian conservatives were dismayed when Robertson sold his television network to Murdoch. Murdoch's papers strongly supported George W. Bush in both the 2000 and 2004 presidential elections.
Murdoch's publications worldwide tend to adopt conservative views. During the buildup to the 2003 invasion of Iraq, all 175 Murdoch-owned newspapers worldwide editorialized in favour of the war. Murdoch also served on the board of directors of the libertarian Cato Institute. News Corp-owned Fox News is often criticized for a strong conservative and anti-liberal bias.
On May 8, 2006, the Financial Times reported that Murdoch would be hosting a fundraiser for Senator Hillary Clinton's (D-New York) Senate reelection campaign. Murdoch's New York Post newspaper opposed Clinton's Senate run in 2000.
In May 2007, Murdoch made a $5 billion offer to purchase Dow Jones, owner of the Wall Street Journal. At the time, the Bancroft family, who controlled 64% of the shares, outspokenly declined the offer, opposing Murdoch's often-used strategy of large employee cuts and "gutting" pre-existing systems. Later, the Bancroft family confirmed a willingness to consider a sale--aside from Murdoch, the Associated Press reported that supermarket billionaire Ron Burkle and Internet entrepreneur Brad Greenspan were among other interested parties. On August 1, 2007, the BBC's "News and World Report" and NPR's Marketplace radio programs reported that Murdoch bought Dow Jones; the news was received with mixed reactions.

United Kingdom

In Britain, he formed a close alliance with Margaret Thatcher, and The Sun was widely credited with helping John Major win an unexpected election victory in the 1992 general election. However, in the general elections of 1997, 2001 and 2005, Murdoch's papers were either neutral or supported Labour under Tony Blair. This has led some critics to argue that Murdoch simply supports the incumbent parties (or those who seem most likely to win an upcoming election) in the hope of influencing government decisions that may affect his businesses. The Labour Party under Blair had moved significantly to the Right on many economic issues prior to 1997. Murdoch identifies himself as a libertarian.
In a speech in New York, Rupert Murdoch said that the UK Prime Minister Tony Blair said the BBC coverage of the Hurricane Katrina disaster was full of hatred of America. Murdoch is a strong critic of the BBC, which he believes has a left wing bias.
In 1998, Rupert Murdoch made a failed attempt to buy footballing power Manchester United FC. He offered £625 million. It was the largest amount of money anyone had offered for a sports club. It was rejected by the United Kingdom's Competition Commission, citing that the acquisition would have "hurt competition in the broadcast industry and the quality of British football".
On June 28, 2006 the BBC reported that Murdoch and News Corporation are flirting with idea of backing Tory leader David Cameron at the next General Election. However in a recent interview, when asked what he thought of the new Conservative leader, Murdoch replied "Not much".
In 2006, the UK’s Independent newspaper reported that Murdoch was to offer Tony Blair a senior role in his global media company News Corp. when the UK prime minister stood down from office.
He is also accused by former Solidarity MSP Tommy Sheridan having a personal vendetta against him and of conspiring with MI5 to produce a video of him confessing to having affairs - allegations which Sheridan had previously sued News International over and won. On being arrested for perjury following the case Sheridan claimed that the charges were "orchestrated and influenced by the powerful reach of the Murdoch empire"

Personal life

Murdoch has been married three times. In 1956 he married Patricia Booker, a former shop assistant and air hostess from Melbourne, with whom he had his first child, a daughter Prudence Murdoch, born in 1958. Pat did not like Adelaide with its extremes of weather and where she had few friends and Rupert was frequently away building the foundations of his future empire. They divorced in 1967. In the same year, he married Anna Tõrv, an Estonian-born cadet journalist working for his Sydney newspaper The Daily Telegraph.
Tõrv and Murdoch had three children: Elisabeth Murdoch (born in Sydney, Australia August 22, 1968), Lachlan Murdoch (born in London, UK September 8, 1971), and James Murdoch, (born in Wimbledon, UK December 13, 1972). Murdoch's companies published two novels by his then wife: Family Business (1988) and Coming to Terms (1991); both were seen as being vanity publications. Anna and Rupert divorced acrimoniously in June, 1999.
Anna Murdoch received a settlement of US$ 1.2 Billion assets. Seventeen days after the divorce, on June 25, 1999, Murdoch, then 68, married Chinese born Deng Wendi, later changed to Wendi Deng. She was then 30, a recent Yale School of Management graduate and newly appointed vice-president of STAR TV. Anna Murdoch was also remarried, in October 1999, to William Mann.
Murdoch has since had two children with Deng: Grace (born in New York November 19, 2001) and Chloe (born in New York July 17, 2003).
Murdoch's eldest son Lachlan, formerly the deputy chief operating officer at the News Corporation and the publisher of the New York Post, was Murdoch's heir apparent before resigning from his executive posts at the global media company at the end of July 2005. Lachlan's departure left James, chief executive of the satellite television service British Sky Broadcasting since November 2003, as the only Murdoch scion still directly involved with the company's operations, though Lachlan has agreed to remain on the News Corporation's board.
After graduating from Vassar College and marrying classmate Elkin Kwesi Pianim (the son of Ghanaian financial and political mogul Kwame Pianim) in 1993, Murdoch's daughter Elisabeth, along with her husband, purchased a pair of NBC-affiliate television stations KSBW and KSBY in California on a $35 million loan from her father. By quickly re-organizing and re-selling them at a $12 million profit, Elisabeth emerged in 1995 as an unexpected rival to her brothers for eventual leadership of the publishing dynasty's empire. But after quarreling publicly with her assigned mentor Sam Chisholm at BSkyB, she veered out on her own as a television and film producer in London, where she has enjoyed independent success in conjunction with her second husband, Matthew Freud.
It is unknown whether Murdoch will remain as News Corp's CEO indefinitely. The American cable television entrepreneur John Malone was for a time the second largest voting shareholder in News Corporation after Murdoch himself potentially undermining the family's control. In 2007, the company announced that it would sell certain assets and provide cash to Malone's company in exchange for the cancellation of their stock. Murdoch in 2007 issued his older children with equal voting stock perhaps to test their individual interest and ability to run the company according to standards he has set.

In 1999, The Economist reported that Newscorp Investments had made £1.4 billion ($2.1 billion) in profits over the previous 11 years but had paid no net corporation tax. It further reported, after an examination of what was available of the accounts, that Newscorp would normally have expected to pay a corporate tax of approximately $350 million. The article explained that the corporation's complex structure, international scope and use of offshore havens allowed News Corporation to avoid tax.
Rupert Murdoch's Fox News Channel has been criticized for being politically conservative and advocating for conservative policies and candidates. The network is criticised in the 2004 documentary Outfoxed: Rupert Murdoch's War on Journalism, which was produced and directed by Robert Greenwald. An article by Professor Roy Greenslade in Guardian Unlimited pointed out that elsewhere in Murdoch's media empire all 175 newspapers owned by him editorialised in favour of the Iraq war.