Murdoch's World (2 page)

The Dowlers' daughter Milly had been a thirteen-year-old with a quick smile.
She was a saxophone fan who liked to gossip about boys with her older sister, Gemma. On March 21, 2002,
dressed in classic
British school uniform—blazer, Oxford shirt, and skirt—she left her school in the Surrey countryside at seven minutes past three in the afternoon. Twenty minutes later, she was on a train home. She got off at her stop. A witness spotted her a hundred yards away at about six minutes past four. After that, Milly was never seen again.

For most of 2002, Milly's parents and sister had no idea what had happened to her. The disappearance became fodder for hundreds of headlines speculating on her fate. The police focused on exactly the wrong clues,
poring through Milly's journal writings for proof of tension between the parents. They looked for evidence of conflict between the two sisters: Gemma was the favorite, Milly wrote. The absent girl was unhappy. Perhaps she had run away. Some investigators fixated on her father's claimed interest in pornography.

The outcome was as gruesome as any tabloid editor could imagine.
Milly's bones were found months later, dumped in woodlands. It took until June 2011 for prosecutors to try and convict a man for her killing. Police had missed earlier clues tying Milly's death to the man, who had been found guilty in two previous deaths.

The Dowlers' pain and anger were heightened by the disclosure that
people working for Murdoch's
News of the World
had hacked into Milly's cell phone voice mail messages to mine them for fodder. Even in death, her privacy had been violated. The Dowlers' phones had been targeted too.

They were not the only ones. In late 2005, aides to princes William and Harry had asked police to investigate whether their phones had been hacked. Two men working for the
News of the World
—the royals editor and a private investigator—were convicted and sent to jail. Celebrities, politicians, and sports stars were added to a growing list of people who had been targeted in the intervening years. But few in the United Kingdom and no one outside it cared until the Dowlers, an ordinary family who had faced a prolonged and extraordinary grief over their dead daughter, were shown to have been victimized as well.

The police swung into high gear, while politicians who had sought Murdoch's blessing lined up to denounce him in Parliament. Rival newspapers that had largely turned a blind eye to such behavior by the Murdoch press (and some of its rivals) turned on News Corp, which sold approximately two of every five national newspapers purchased by readers. The nation rose as one in revulsion.

THE PUBLIC fury struck at the heart of Murdoch's media empire—at some of his much-beloved newspaper properties that were the financial cornerstones of his print business and were supervised by some of his most trusted lieutenants and likely heirs. Britain had been the launching pad for Murdoch's international growth beyond his native Australia. The scandal-driven tabloids
News of the World
and the
Sun
served as his financial base to buy two of the nation's most respected papers, the
Times of London
and the
Sunday Times
, as well as to expand into the United States. His second son, James, his presumed successor and the company's third-ranking executive, held responsibility for the company's operations in the United Kingdom. Rupert ran News Corp like a family business, though its shares were publicly traded on NASDAQ. Together with his adult children,
Murdoch controlled roughly 40 percent of News Corp's voting shares. He had made it clear that the next leader of the company (perhaps after a brief caretaker period) would be someone who shared his last name.

Those few days in July shattered many assumptions. How could
News of the World
function when police were treating its newsroom as a crime scene?
What to do about the CEO of Murdoch's British properties, Rebekah Brooks, or her predecessor, Les Hinton, the man Murdoch had handpicked to publish the
Wall Street Journal
after decades of devoted service? Rupert Murdoch, although famous for his loyalty, could be ruthless when threatened.

Meanwhile,
the company's $14 billion takeover of the United Kingdom's largest cable broadcaster had been cast deeply into doubt. And the standing of James Murdoch, the executive chairman of News Corp in Britain, Europe, and Asia, was imperiled as well. James's older brother—Lachlan—had once been the heir apparent, but he retreated to Australia in the face of vicious political fighting with some of Murdoch's senior executives. Amid the tabloid crisis Lachlan flew to New York and then London to be at his father's side for strategy meetings. But he did not want to rejoin the company, even in a senior role. He enjoyed the freedom of distance from his father and the ability to lead his own, smaller media company back in Sydney. The boys had never taken their sister Elisabeth seriously as a possible future CEO for the company, largely because their father didn't see her in that light. But her outsider status was looking stronger with each passing day, as James's failure to head off this crisis seemed increasingly disastrous for the company.

Murdoch was accompanied to the hotel by Will Lewis, a senior British News Corp executive who had previously been editor of the rival
Telegraph
newspaper.
Everyone at that meeting with the Dowlers knew an out-of-court settlement would ultimately ensue. The logic was inescapable. The revelation that the paper had broken into the phone of a dead girl, barely a teenager, transformed the issue of cell phone hacking in the public's eye from a bit of naughtiness, a lark, to something that frightened the general public. If it could happen to Milly, it could happen to anyone, however innocent and removed from the crosshairs of gossip reporters chasing after celebrity fluff.

So some sort of deal made every sense. But at this meeting no one raised the question of money. The Dowlers' lawyer, Mark Lewis, gestured for people to sit down. (The two Lewises are not related.) Mark Lewis and the Murdoch camp shared a secret that was about to become public: executives for News International, the British wing of News Corp, had assigned journalists and private eyes to follow him
in hopes of uncovering some personal transgression they could use against him and his clients. Murdoch's company was publicly contrite. But privately it had been playing rough.

I know about you
, Mark Lewis told Murdoch.
I know your mother is still alive. She'd be ashamed of you for what you've done
.

Dame Elisabeth Murdoch was then 102, by concensus the conscience and chief patron of the Australian port city of Melbourne, Rupert's birthplace. The media baron assented but then changed the emphasis.
My father. He'd be ashamed
. Keith Murdoch had led one of Australia's most influential media companies. At his death his young son Rupert inherited a small paper in a forgotten city. Mention of his father seemed to change Rupert's mood. His shame melted and he found himself repeating a signature complaint that had motivated him throughout his career.

My father was a great newspaperman
, Keith Murdoch's son said ruefully in the London hotel room.
The British never gave him his due
. It was absolutely irrelevant to the people in the room, a strange aside,
an echo of old battles called to mind by his father's ghost that he had summoned unwittingly to the conference.

Although they lived in different worlds, the couple sitting in that hotel room and the billionaire shared one experience: parenthood. The Dowlers were still grieving, just days after the conviction of their girl's killer, and they were freshly wounded by learning of the tabloid's invasion of her privacy. Murdoch was attempting to salvage his son James's destiny.

Murdoch was tired, from flying and from the pressure he faced.
New allegations claimed that his reporters sought to hack the phones of victims of the September 2001 terror attacks in New York City. If the scandal spread to the United States, it could prove catastrophic to his control of the company. The news magnate who was famously obsessive about details—down to headlines, story selection, and photo
captions—appeared out of touch when it mattered most. James, far from being able to shield his father, had left him and News Corp vulnerable to shame and ridicule.

Gemma Dowler spoke directly to Murdoch on behalf of her parents and dead sister. When her sister disappeared, Gemma had been a round-faced sixteen-year-old studying for the standardized tests that would get her into college. In the intervening nine years she had received a rough education about the cruelties of crime, the justice system, and the press. She took the time to admonish the media mogul.
How would you have felt if it had happened to someone in your family?
He sat with his head in his hands.

In the space of a few days much of his record had come under assault, and Murdoch's character was also being questioned. Was his cowboy style a quirk, a key component of his success, or a fundamental defect that had led to this very moment? Was he guilty, complicit, or, as he suggested, a bystander to this raft of cruelties?

When he finally emerged
blinking into the July sunlight on the marble steps of the hotel,
Murdoch was confronted by a scrum of reporters and photographers and video camera operators, some of them his own. “As founder of the company, I was appalled to find out what had happened,” Murdoch said. “I found that out, I apologized. I have nothing further to say.” Later he would tell members of Parliament, his own reporters, and a judicial inquiry that he had been betrayed by those in whom he put his trust, as well as by the people they in turn had trusted.

But it was not clear whether those people, his reporters, editors, and lawyers, had betrayed the nature of the company he had engineered from his father's modest bequest. The uproar that ensued from the disclosure about the hacking of the voice mail messages of Milly Dowler and others arose from a creeping understanding of the culture of News Corp, based primarily on the qualities of one man.
Rupert Murdoch's company embraced a buccaneering spirit to create new fortunes, and it was built on personal and family ties more than most, with a clubbiness, or mateship, that was almost impossible for outsiders to penetrate. The scandals of 2011 revealed that culture had also become untethered from the well-being of the people it claimed to serve.

2

RUPERT IN OZ

IN GREEK MYTHOLOGY, THE GIANT Antaeus was the son of Gaia, goddess of the earth, and Poseidon, king of the sea. The mighty Antaeus forced all passersby to wrestle him. The trick of his invincibility, as the story goes, was that he drew strength from any touch or contact with the ground—the earth of his mother.

For Rupert Murdoch, Australia, or at least
the idea of Australia, serves as an analogous source of strength. In New York, London, and Los Angeles, Murdoch entrusted outposts to people who served him in his native land.
Robert Thomson, born in a small town several hours north of Melbourne, led the
Times of London
, ran the
Wall Street Journal
and Dow Jones, and became the first CEO of the new News Corp publishing company when it split off on its own in June 2013.
Col Allan, from the tiny agrarian town of Dubbo far outside Sydney, has been entrenched at the heart of the world's media capital for more than a decade as the editor of the
New York Post
.
The British-born Les Hinton moved to Australia as a teenager and got his start as a gofer at Murdoch's
Adelaide News
in the late 1950s. He became CEO
over Murdoch's British operations and then publisher of the
Wall Street Journal
.
David Hill, an Aussie who ran sports for Murdoch in the United Kingdom and Australia, reinvented Fox Sports in the United States when it successfully bid for rights to broadcast NFL games in the early 1990s and returned to lead a new national Fox Sports network in 2013.