News Corp. may want to focus on its earnings, but this scandal isn’t going anywhere in the eyes of the media
Phone hacking? What phone hacking?
Though News Corp. COO Chase Carey opened Wednesday’s earnings call by addressing his company’s “difficulties in the U.K.,” he made it very clear that News Corp. is tired of discussing the subject. The absence of News Corp. Chairman and CEO Rupert Murdoch, who grew testy at the company’s last shareholder’s meeting, made it even more apparent.
While analysts largely respected Carey’s admonishment that everyone look forward and focus on the company’s ongoing operations, journalists opened fire when they got a chance towards the end.
First there was a question about the cost of phone hacking, but Carey said the company had already accounted for them.
Later on, there was a question about possible changes to the Board of Directors given that many shareholders voted against re-electing several members, including James and Lachlan Murdoch.
Carey said the company was taking the votes seriously, but dismissed the idea of upcoming changes. He said the company is “proud of the board” because it has “provided unique leadership and value to the business.”
Sandwiched in between those questions was the big uncertainty – the future of James Murdoch.
Asked about the possibility of management changes, specifically the possibility of replacing James Murdoch, Chairman and CEO of News Corp. Europe and Asia, Carey seemed to get a sense of humor.
Maybe he knew such a question was coming, maybe he was being smug, maybe a bit of both.
“We have great confidence in James.” [Pause]. “James has done a good job and we are not contemplating any changes,” Carey said.
Recent evidence suggests “great” might be more than a bit kind.
The U.K. Parliamentary Committee investigating the phone hacking scandal released a trove of internal News Corp. documents earlier this week that suggest Murdoch has been lying about how much he knew.
Given that Murdoch’s former employees have already questioned veracity of his testimony before Parliament, these documents may just serve as more damning evidence of deception.
Ever since the phone hacking scandal reignited in July, James has insisted he thought hacking was limited to one reporter, Clive Goodman. Former News of the World editor Colin Myler and former legal counsel Tom Crone then said Murdoch misled Parliament. Now these emails and messages suggest that as well.
James has also denied that he had further knowledge of hacking when he approved settlements for victims like Gordon Taylor, the former head of the Pro Footballer’s Association. Again, recent documents suggest otherwise.
Journalists, angry shareholders and many more have set James in their cross hairs – not that this is new.
Even before this latest turmoil, there were stories about Rupert’s displeasure with James.
Everyone following the story wanted to know how much he and other top executives knew, and whether it led to rapid and expensive settlements.
Then this week Vanity Fair’s Sarah Ellison revisited the hacking saga, this time revealing that the Murdoch clan got together for family therapy to discuss News Corp.’s future.
Perhaps some clarity will come Nov. 10, when James returns to Parliament to answer more questions.
But even if he manages to escape unscathed, you can bet this story still isn’t going away.
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