Things figure to get worse before they get much better in London. British authorities are now reviewing the company, seeking to determine if it remains a “fit and proper” media organization. If government officials determine that its illegal practices run deep, Hart said the company could be forced to divest itself of all or part of its current BSkyB stake.
Murdoch’s withdrawal from the BSkyB bidding came amid a wave of national outrage over the scandal, which exploded last week after the Guardian newspaper reported that News of the World reporters had hacked the phones of the families of dead British soldiers and a 13-year-old girl abducted and slain in 2003.
A ninth person has been arrested in the "News of the World" phone hacking scandal and the British Government Committee has issued a summons for Rupert and James Murdoch. (July 14)
Prime Minister David Cameron, who won the support of Murdoch’s papers for his Conservative Party’s bid in the last election, called Wednesday for the company to “clean its stables.”
He reiterated an earlier statement that Murdoch should accept the resignation of Rebekah Brooks, News International’s chief executive. Officials are attempting to call Brooks, Murdoch and his son James, a News International executive, to testify in Parliament next Tuesday.
Brooks, who was editor of News of the World from 2000 to 2003 when some of the worst of the hacking cases allegedly took place, reportedly has offered to resign. But Murdoch hasn’t accepted. “She was right to resign,” Cameron said Wednesday on the floor of the House of Commons. “That resignation should have been accepted. There needs to be root and branch change at this entire organization.”
No matter the outcome, Rodney Barker, professor of government at the London School of Economics, said Murdoch’s mystique will never be fully restored.
“We tend to think of the business world as a world run by people who are hardly human,” Barker said. “Once it begins to look like Rupert Murdoch is not the unstoppable force that he has always been, the shine goes off a bit, the shares go down and people start saying someone else should take over. He’s harmed his profitability, [and] in the end his reputation is irreparably damaged anyway.”
Faiola reported from London.