Murdoch's World (44 page)

Elisabeth Murdoch had prepared for months, walking through the implications of her remarks with her husband, Matthew Freud. James's camp felt Elisabeth had abandoned her brother. She repudiated the values that the present-day corporation embodied. It was an audacious audition. Elisabeth expressed her anger at what her father and her brother had done. And she hinted that she was willing to come in from the cold, but only on her own terms.

THE BBC that Elisabeth Murdoch had praised had turned its investigative scrutiny onto News International repeatedly over the previous two years, focusing on phone hacking, satellite TV pirates, bribery, surveillance, and political intimidation. The news stories had taken on an increasingly sharp edge as the reporting of the
Guardian
, the
New York Times
, and the
Independent
gave the broadcaster space and confidence to pursue its leads.

The BBC lost its nerve, however, when it came to reporting on itself. The previous year had marked the death of one of the network's most lauded and peculiar figures, Jimmy Savile. The self-congratulatory
disc jockey and children's TV host with the startling blond hair had been celebrated in a year-end tribute that marveled at his push for pop music and the fund-raising he did for children's charities. He drove a Rolls Royce, wore flashy jewelry and jogging suits, and adopted a zany affect, whipping kids (and off camera, some of their parents) into a frenzy.

Following his death, the BBC's investigative unit at the show
Newsnight
was preparing a story alleging that Savile had raped some of the children who appeared on his shows decades earlier. But
the show's editor killed the story. The
Newsnight
staff erupted into civil war. Hundreds of women surfaced to accuse the dead star of preying on them as teens. Some men said Savile violated them, too, when they were boys.
ITV broadcast a documentary on Savile. The BBC reeled. Executives for the program, the news division, and the entire broadcasting corporation were shunted aside or lost their jobs. MPs hauled BBC officials and its chairman,
Murdoch's old antagonist Chris (now Lord) Patten, to testify at parliamentary hearings. The allegations against Savile implicated an era of sexual entitlement by famous figures at the BBC and elsewhere. Britain's most esteemed institutions had turned a collective blind eye. Even the National Health Service was implicated, as Savile had been given the run of a hospital for which he had raised money; women said he raped them there when they were young.

Bad publicity ensuing from the story
could damage the
New York Times
, which had announced that the BBC's former top executive, Mark Thompson, would become its CEO in November. Murdoch taunted his rivals, tweeting on October 14,
“Saville [sic]-BBC story [has a] long way to run. BBC [is by] far the biggest, most powerful organization in UK.” Other tweeters suggested more powerful organizations: the Church of England, the British Navy, even News Corp.

Not surprisingly, Murdoch's papers covered the story vigorously. The
Sun
published semilurid headlines with each new allegation
against Savile and his alleged fellow predators. The
Times of London
soberly dissected the BBC's unconvincing explanation of its failure to respond to early accusations against its star and of its decision to shelve its documentary. Yet News International officials believed that if
they pushed the matter too hard, the BBC's defenders could claim they were trying to undermine a rival. Such calculations were themselves another consequence of the hacking scandal: they kept the papers' thirst for blood in check.

WHEN JUDGE Leveson came out with his final report, Fleet Street braced for the worst. Editors and executives indicated they could accept some additional restrictions on the press. Politicians met with press representatives, hacking victims, and their families. Prime Minister Cameron, for example,
invited in Hugh Grant, Charlotte Church, and the former television crime-show host Jacqui Hames. Murdoch could not control himself, tweeting, “Told UK's
Cameron receiving scumbag celebrities pushing for even more privacy laws. Trust the toffs! Transparency under attack.” Cameron and Grant were upper-class Oxford graduates, elites striking deals behind closed doors. Murdoch (Worcester College, Oxford, Class of 1952) followed up with tweeted digs at Grant for
his liaison with a prostitute in Los Angeles years earlier and for fathering a child out of wedlock;
Murdoch apologized for
wrongly claiming Grant had played no role in the child's life. But he was otherwise unrepentant. The private lives of the famous were fair game for his tweets as much as his newspapers.

Leveson's report dismantled layers of rationalizations, built over decades, for systematic abuses. Despite a system of self-regulation, he noted, the press had ignored its obligations “to respect the truth, to obey the law, and to uphold the rights and liberties of individuals.” The
pursuit of the story has too often, he wrote, “caused real hardship and, on occasion, wreaked havoc with the lives of innocent people.”

Leveson argued that the industry required a tighter form of self-regulation, infused with a touch of legal compulsion. The new structure needed to offer people who believed they had been wronged in the press the means for fair-minded arbitration of complaints. Publishers that refused to submit to the regulator would be far more likely to have to pay for legal costs, even if they prevailed in court.

The proposed solutions created a fresh batch of problems. Would the supposedly “light touch” by lawmakers remain all that light when another press scandal flared? If editors passing judgment on their brethren seemed incestuous, would it be any better for political appointees to do so? In the US, the Federal Communications Commission had the increasingly anachronistic task of holding radio and broadcast television stations responsible for airing obscene language and sexually explicit imagery. The growth of cable, satellite, and Internet-based video services made regulation of content on purely broadcast outlets seem quaint, though such material clearly reached tens of millions of children watching old-fashioned television stations through the day. Typically such decisions had little to do with the journalism offered by those stations, however, as federal officials had long since abandoned monitoring political coverage for balance and all but given up adjudicating challenges to the veracity of programming. The remedy for poor speech was more of it, and the US was awash in opinionated fare on radio, cable news, the Internet, and, from the former members of the audience, on social media platforms. Leveson's report acknowledged that new media landscape but focused directly on the press anyway.
A blogger could base his website in the West Indies, as did Paul Staines, a British conservative libertarian whose gossipy posts caused fits for both Tory and Labour politicians, and thereby sidestep press regulations. So could, presumably, an American magazine that did not
circulate print editions in the UK but sold digital subscriptions there. A lot of wrinkles had to be worked out. Leveson used government involvement as a last-ditch threat: if the press did not create a credible form of self-regulation, he would try to get OfCom designated as the official regulator for the press as well as television.

Labour and Liberal Democratic politicians vied to embrace the proposals. David
Cameron expressed doubts. He opposed creating new government involvement in press affairs. His former allies at the Murdoch papers and some of their competitors, such as the
Daily Mail
, the
Telegraph
, and the
Spectator
, voiced skepticism bordering on contempt for Leveson's plan. As the weeks passed, the specter of state influence sparked a backlash, especially among publications that were not implicated in widespread abuses. In March 2013, after several rounds of negotiations between newspaper executives and the government collapsed,
Cameron pushed a plan with a royal charter. The self-regulatory arrangement, which would be enshrined in law by Parliament, would take away the industry's veto over appointments to the panel that would enforce the press code, yet ensure that most members had strong journalistic ties. The proposal made some reformers recoil. The
Guardian
's Rusbridger, who previously said greater regulation was inevitable, argued that the newspaper industry deserved a year to deliver its best shot at a workable solution before the government intervened.

Press executives, politicians, and victim advocates expended extraordinary effort to outfit the earlier, nearly worthless system “with teeth.” But the problem went beyond the flaws in the processes of various regulators. Leveson proposed a serious shift in the relationship between the state and the press at the heart of one of the world's leading democracies simply because the shadow cast by one news outfit was so great that police, prosecutors, and politicians could not imagine enforcing the law against the criminal activities of its journalists.

The most direct, albeit radical solution,
as media analyst Claire Enders argued before Leveson, would be to limit the size and reach of major media companies. Her plan's appeal lay in its logic and simplicity. Such an approach would have required major government interference in the workings of private industry. And it would have been reasonably seen as targeting News Corp, rendering its takeover of BSkyB or any other significant acquisition in Britain off-limits, even in the future. Labour leader
Ed Miliband advocated that path before Leveson but not in Parliament.

Murdoch had dodged the big bullet.

IN CHINA, where Murdoch once had great ambitions for News Corp, the stakes could not have been higher. In early 2012, a British reporter poached by Thomson for the
Wall Street Journal
from the
Times of London
, Jeremy Page, had pieced together a
story about a possible cover-up involving a murdered British businessman, the wife of a powerful Chinese politician, and a Chinese police chief seeking sanctuary in the British embassy.
“It involved a certain amount of risk to publish something like that,” said Rebecca Blumenstein, a senior
Journal
editor overseeing the story. After she and others carefully edited the article, Blumenstein turned to Thomson, handing him a copy. Thomson's eyes widened as he pored through it. He did not cite any concerns about News Corp's vast Chinese business interests, which included not just the paper but the company's blockbuster films. He said simply, “Are we confident about the sourcing?”

Two weeks later, Chinese officials confirmed the outlines of the
Journal
piece, an endorsement accompanied by the regime's decision to shut down access to the paper's Chinese language site inside China. David Barboza of the
New York Times
later revealed corruption involving the family of the Chinese premier, Wen Jiabao. When
the
Times
website was shut down and fifty-five of its computers hacked, the newspaper publicly denounced Chinese retaliation. The
Journal
carried itself much more quietly, only to find the
Times
rewarded months later with a Pulitzer Prize for Barboza's reports, one of four it won in 2013. The
Journal
won a Pulitzer, too—for the opinion columns of contrarian conservative Bret Stephens. The newsroom had been once again shut out of the most revered awards in print journalism. Those at the
Journal
who respected Thomson thought judges at
the Pulitzers were once again punishing the paper's reporters and editors for the sin of working for a publication owned by Rupert Murdoch.