26 July 2011


Story first appeared in the Associated Press
Australia's competition watchdog has expressed concern at a bid by Rupert Murdoch's cable television operation to buy out a rival, saying it would create "a near monopoly" of pay TV service in the country.
The statement Friday by the Australian Competition and Consumer Commission is another setback for Murdoch, whose media empire is embroiled in a phone hacking scandal in Britain. His News Limited, a subsidiary of his U.S.-based News Corp., has substantial stakes in Australian media companies, including in FOXTEL, the country's largest subscription television provider.
Although the ACCC's statement is only on its preliminary finding, it gives a clear indication that it would be opposed to such a merger. The deal cannot go through without the commission's approval.
FOXTEL, which delivers more than 200 channels to 1.63 million subscribers in metropolitan areas of Australia, is seeking to buy Austar, which has over 760,000 subscribers.
Austar, however, is available mostly in regional and rural Australia, and the only place where the two rivals are competing is in the Gold Coast.
The ACCC said that because of the distinct markets of the two companies, there is substantial room for competition in the cable TV business in Australia.
It said its preliminary view is that the proposed acquisition is likely to result in a substantial lessening of competition in the national market for the supply of subscription television services. It said that the proposed merger would therefore effectively create a near monopoly subscription television provider across Australia.
The statement said that disallowing a merger will substantially increase the ability and incentive for FOXTEL and Austar to compete with one another outside of their existing distribution regions, and the proposed acquisition would prevent any such competition from occurring.
The ACCC says free-to-air television networks are not sufficiently close competitors to subscription TV to constrain the actions of a combined Foxtel-Austar.
The ACCC has asked for further submissions from interested parties by Aug. 11, and it intends to publicly announce its final view by Sept. 8.


Story first appeared on the Associated Press.
Kim Kardashian wants Old Navy to stop using a lookalike to advertise its clothing.
The reality show starlet and model on Wednesday sued the clothing store and its parent company, The Gap Inc., in a Los Angeles federal court alleging their ads violated her publicity rights with ads that feature a woman who looks like her.
A video of a broadcast ad featuring a smiling, dark-haired woman who bears a resemblance to the real Kardashian has been viewed more than two million times on Old Navy's YouTube channel.
Kardashian's lawsuit claims consumers may be confused by the ads and the model's actual endorsements, which include her own clothing store and shoe line. A commercial, titled, "Super C-U-T-E," began airing in February and Old Navy is still using some of the promotions, the lawsuit states.
The case cites all the benchmarks of modern celebrity: her eight million followers on Twitter, more than five million fans on Facebook and ranking as one of the most searched-for celebrities on the Internet.
The lawsuit states that Kardashian has invested substantial time, energy, finances and entrepreneurial effort in developing her considerable professional and commercial achievements and success, as well as in developing her popularity, fame, and prominence in the public eye.
Louise Callagy, a spokeswoman for San Francisco-based Gap said the company has not yet seen the case and had no comment.
Kardashian, 31, has rocketed to fame in recent years after gaining prominence as a friend of Paris Hilton and for having a sex tape. She appears along with her family on the E! Entertainment Television series "Keeping Up With the Kardashians" and routinely graces magazine covers.
Her lawsuit is seeking unspecified damages and wants a federal judge to prevent Old Navy from using a Kardashian lookalike model in its ads again.
The model in the ads, Melissa Molinaro, is not named in the lawsuit. She expressed exasperation that the resemblance was being pointed out again.

19 July 2011


To his many enemies, Rupert Murdoch is getting his comeuppance.
Murdoch's tabloid newspapers long have reveled in the misdeeds of others with salacious photos and pun-packed headlines. Now, one of the world's most powerful media executives is learning what it's like to be enveloped in his own scandal.
For some there is a feeling that Murdoch has been king of the world for too long and it's about time that somebody brought him back to Earth.
But no one is calling press conferences to gloat about Murdoch's troubles. Even his bitterest media rivals are keeping quiet.
Liberty Media chief John Malone, who engaged in media-mogul head butting with Murdoch over his stake in Murdoch's News Corp and other issues has not commented.
CNN founder Ted Turner, who once challenged Murdoch to a boxing match in Las Vegas isn’t talking either.
New York Daily News Publisher Mort Zuckerman, whose newspaper fights every day for front page dominance with the Post for New York's tabloid audience also has clammed up.
It's hardly surprising, of course. Despite a scandal that has claimed two of his top executives and led him to close one of his British tabloids, Murdoch still runs News Corp., one of the world's most imposing media empires. There's no percentage in gloating publicly about the scandal if you still have to compete - and perhaps do business - with the 80-year-old Murdoch.
But others aren't as charitable. In recent days, Murdoch has drawn comparisons to a cruel monarch, Richard Nixon, even the devil.
The scandal centers on revelations that journalists at his top-selling British tabloid, News of the World, gathered information through a variety of possibly illegal endeavors that included phone hacking and bribery of police officers. Last week, he closed the 168-year-old tabloid and withdrew a hard-fought bid for 100 percent ownership of prized satellite TV carrier British Sky Broadcasting. He even met with and apologized to the family of a missing, murdered girl whose phone was hacked by News Corp. journalists.
On Friday, he accepted resignations from two top News Corp. executives, Rebekah Brooks, who ran News International, which controlled News of the World and the company's other British newspapers, and Dow Jones & Co. CEO Les Hinton, who used to run the same unit.
The unfolding saga threatens to expose Murdoch and his company to further scorn and legal troubles. News Corp. stock has shed billions of dollars in value. And criminal investigations are under way in Britain, while the FBI has begun a preliminary inquiry in the U.S., where the company's holdings include the nation's largest newspaper, The Wall Street Journal, the New York Post, the Fox TV network and the 20th Century Fox movie studio.
For now, Murdoch's job as News Corp.'s CEO is secure because he controls 40 percent of the company's voting stock through a family trust and the board is stacked with directors that shareholder activists have long criticized as his cronies. He also remains one of the world's richest people, although a fortune pegged at $7.6 billion in March by Forbes magazine has been clipped by a 13 percent decline in News Corp.'s stock during the past two weeks.
But the British lawmakers who have traditionally supported Murdoch rather than risk being pilloried in the pages of his newspapers no longer seem to be in his corner because their fear of retaliation is fading. He will surely face tough questions Tuesday when he appears before a Parliament committee eager to grill him about the phone hacking and bribery allegations.
All the powerful allies that used to help him, either publicly or behind the scenes, have appeared to be faded to the sidelines, and now it looks as thought he is on his own, and he is in over his head.
Some Murdoch critics compare the crisis and widespread antipathy surrounding Murdoch to the unraveling of Richard Nixon's presidency in 1974 as details of the Watergate cover-up were revealed. Like Nixon then, Murdoch is in free-fall mode, and there seems to be nothing he can do to stop this story.
The lack of control over the situation seemingly bothers the notoriously autocratic Murdoch, who said he was getting annoyed with the media's unrelenting coverage of the scandal.
If the scandal widens, some believe Murdoch eventually will have to step down as CEO, though he could still retain the chairman's title.
Disgraced newspaper publisher Conrad Black, whose former ownership of The Daily Telegraph turned him into a bitter Murdoch rival, thinks his old foe is more like another polarizing historical figure - French emperor Napoleon Bonaparte. He stated that like Napoleon, Murdoch is a great bad man, and it is as wrong to dispute his greatness as his badness.
Black, who was convicted of fraud in 2007 and still has some prison time to serve, wrote that it would be astonishing if Murdoch's British newspapers didn't commit crimes while reveling in the climate of immunity that has been the group's modus operandi for decades. Although he stopped short of calling him a crook, Black lambasted Murdoch as an an exploiter of the discomfort of others and a malicious myth-maker, an assassin of the dignity of others and of respected institutions.
Murdoch also is despised by union workers who still remember how he used a new printing plant to foil a printers' strike in the gritty London district of Wapping in 1986 and 1987. One area resident, recalls seeing police regularly harass and arrest picketers while making sure delivery trucks got into and out of the printing plant. That fed his suspicions that the police were in Murdoch's pocket.
In the U.S., much of the ill will toward Murdoch has stemmed from the belief that he uses his media properties, especially the Fox News cable channel, to promote a conservative political agenda. There is essentially a partisan reaction against Murdoch and his use of right-wing politics.
Fox News isn't covering Murdoch's scandal as aggressively as other outlets. From July 4 through July 13, Fox aired 30 segments about the story. Rival CNN showed 109 segments and MSNBC 71.
When Murdoch bought Dow Jones, parent company of the Wall Street Journal, for $5.7 billion in 2007, there were fears the Journal's quality would deteriorate. But Paul Steiger, who left as the Journal's top editor shortly after the acquisition was completed and started a non-profit journalism service called ProPublica, credits News Corp. for investing in the newspaper to maintain its quality and increase its circulation.
Some members of the family in control of the company that sold the Journal to Murdoch seized on the scandal to express seller's remorse. They stated that they did a deal with the devil and it really saddens them.
Hinton, 67, became the first of Murdoch's U.S. executives swept out in the scandal. He resigned Friday from his post as CEO of Dow Jones & Co. and publisher of The Wall Street Journal, ending a 52-year career working for Murdoch. Hinton was executive chairman of the division that included News of the World during some of the years in which the phone hacking occurred. He had assured British parliament in 2007 and 2009 that the hacking had been limited to a rogue reporter, an assertion that proved to be untrue. Hinton joined The Associated Press' board of directors in April.
In his resignation statement, Hinton said he never knew about the rampant hacking at the British tabloid.


British Prime Minister David Cameron, under huge political pressure over the intensifying phone hacking scandal at Rupert Murdoch's embattled U.K. newspaper empire, said Monday that Parliament should delay its summer break so he can brief lawmakers.
Parliament is due to break up for the summer on Tuesday, but Cameron said that it may well be right to have Parliament meet on Wednesday so he can make a further statement.
Cameron was speaking in South Africa, on the first day of a two-day visit to the continent. He had planned a longer trip, but cut it short as his government faces increasing questions about its relationship with the Murdoch media empire amid a scandal that has tainted some of Britain's top political, media and police figures.
London police chief Paul Stephenson resigned Sunday over his ties to a former News of the World executive editor who has been arrested over the scandal. In his resignation speech Stephenson made reference to Cameron's hiring of Andy Coulson, a former editor of the shuttered tabloid who was arrested earlier this month over hacking.
Murdoch's former British CEO - and Cameron's friend - Rebekah Brooks, was arrested Sunday on suspicion of hacking.
Cameron said his government had taken very decisive action by setting up a judge-led inquiry into wrongdoing by the newspaper.
Both Stephenson's resignation and Brooks' arrest are ominous not only for Murdoch's News Corp., but for a British power structure that nurtured a cozy relationship with his papers for years.
The arrest on Sunday of the 43-year-old Brooks, often described as a surrogate daughter to the 80-year-old Murdoch, brought the British police investigations into the media baron's inner circle for the first time. She was released on bail some 12 hours later.
Brooks, the ultimate social and political insider, dined at Christmas with Cameron. His Conservative-led government is now facing increasing questions about its relationship with Murdoch's media empire.
Rupert and James Murdoch are to be grilled by British lawmakers Tuesday over the scandal. Brooks also had agreed to be questioned before a parliamentary committee, but her arrest throws that appearance into doubt.
Stephenson said he did not make the decision to hire Wallis and had no knowledge of allegations that he was linked to phone hacking, but he wanted his police force to focus on preparing for the 2012 London Olympics instead of wondering about a possible leadership change.
Stephenson said he had no knowledge of the extent of this disgraceful practice and the repugnant nature of the selection of victims that is now emerging, and that he will not lose any sleep over his personal integrity.
Cameron's office says he is back in Britain on Wednesday. He will visit South Africa and Nigeria. He had also planned to visit Rwanda and Sudan but a decision was made last week to drop that part of the itinerary.


News Corp.’s phone-hacking crisis claimed two top newspaper executives as Chief Executive Officer Rupert Murdoch defended his handling of the scandal and the FBI began a U.S. probe of the company.

Les Hinton, chairman of News International in the years the alleged hacking occurred, stepped down as head of the Dow Jones division yesterday. That followed the exit of News International CEO Rebekah Brooks. She was editor of the News of the World, the newspaper implicated in the scandal, from 2000 to 2003.

The spotlight will shift back to Murdoch and his son, James, the deputy chief operating officer, on July 19 when the two testify about the phone-hacking scandal before the U.K. Parliament. With the FBI involved and the company facing civil litigation in the U.S., the scandal is likely to grow.

In a statement announcing Hinton’s departure, the 80-year- old CEO downplayed his own importance to the company he built from two inherited Australian newspapers. He stated that News Corp. is not Rupert Murdoch, that it is the collective creativity and effort of many thousands of people around the world, and few individuals have given more to this company than Les Hinton.

FBI Role

The Federal Bureau of Investigation, prodded by members of Congress, began looking into whether News Corp. employees may have targeted the phones of victims of the Sept. 11, 2001, terrorist attacks.

U.S. Representative Peter King, the Republican chairman of the House Committee on Homeland Security, asked FBI Director Robert Mueller in a July 13 letter to investigate whether News of the World employees tried to access voicemails belonging to the victims through bribery and illegal wiretapping.

The FBI stated they are aware of certain allegations pertaining to a possible hacking by News Corp. personnel and they are looking into those charges.

Hiring Counsel

News Corp. has hired criminal defense lawyer Brendan V. Sullivan Jr.
of the Washington law firm Williams & Connolly LLP, the New York Times reported. Sullivan’s clients have included former Alaska Senator Ted Stevens, ex-New York Stock Exchange Chairman Richard Grasso and Reagan White House aide Oliver North.

Murdoch, in an interview with the News Corp.-owned Wall Street Journal, said an independent committee led by a distinguished non- employee will investigate the phone-hacking allegations. He claims the company has handled the crisis extremely well, with minor mistakes.

He met yesterday with the parents of Milly Dowler, a murdered schoolgirl whose voicemails were hacked by News of the World in 2002.

After meeting the Dowlers, Murdoch said he was appalled to find out what happened. He claims he apologized.

Dropped Bid

Murdoch has been in London since last weekend as the scandal escalated and politicians of all parties called on him and James, 38, to take responsibility. News Corp. is publishing an apology in all national newspapers in Britain, the younger Murdoch said in a letter to employees.

The now-defunct News of the World tabloid is accused of hacking hundreds of voice mails, including those of murder and terrorism victims, and bribing police for confidential information. Last week, News Corp. closed the 168-year-old newspaper. London police have made at least nine arrests as part of their investigation.

The scandal led News Corp. to abandon its $12.6 billion (7.8 billion-
pound) bid for full control of British Sky Broadcasting Group Plc.

News Corp. rose 21 cents, or 1.3 percent, to $15.64 yesterday in Nasdaq Stock Market trading in New York. The Class A shares have fallen about 13 percent since the first reports on July 4 that News of the World had hacked Milly Dowler’s voice mail.

The resignation of Brooks marked a U-turn for Murdoch, who had stood with the newspaper executive and said she would stay on. Murdoch this week backed his son and heir apparent, saying James had acted as fast as he could, the moment he could.

Family Holdings

The Murdochs must cooperate fully with inquiries into the phone- hacking scandal.

Murdoch controls News Corp. through a 38 percent stake in the company’s Class B voting shares. Those shares represent a 12 percent economic interest in the company, when nonvoting shares are counted as well.

In addition to Rupert Murdoch, News Corp.’s board members include his son Lachlan, 39, as well as James. Murdoch’s daughter Elisabeth, 42, was expected to become a director after selling her Shine Group TV production outfit to News Corp. for $673 million in February.

Justice Department

King’s request to Mueller was one of several by elected officials and media watchdog groups to investigate News Corp. King, who represents part of New York’s Long Island, said in the letter that his district lost 150 people in the attacks.

In a July 13 letter, New Jersey senator Frank Lautenberg asked U.S.
Attorney General Eric Holder and SEC Chairwoman Mary L. Schapiro to investigate whether News Corp. or its subsidiaries breached the U.S. Foreign Corrupt Practices Act.

The act makes it a crime for a U.S.-based company, such as News Corp., to pay foreign officials to get or keep business.

Holder yesterday confirmed the existence of a U.S. probe in public comments he made while in Sydney.

He claims there have been members of Congress in the United States who have asked them to investigate the same allegations, and they are progressing in that regard using the appropriate federal law enforcement agencies in the U.S.

Rupert Murdoch said the company isn’t separating its newspaper assets, which also include U.K.tabloid The Sun, the Times of London and the New York Post. The company will establish a protocol for behavior for reporters across the company, he said.

12 July 2011


News Corp.’s Chief Executive Officer Rupert Murdoch is headed to London to help manage fallout from the phone-hacking scandal that forced the closure of News of the World, Britain’s biggest Sunday newspaper.
Murdoch will work from News International’s headquarters in London’s Wapping neighborhood and meet with staff.
The unfolding crisis led to the arrest of the tabloid’s former editor, Andy Coulson, and prompted public anger over allegations its journalists bribed police for stories and hacked into the voice mails of crime victims. The U.K. government said yesterday it will take some time before ruling on News Corp.’s 7.8 billion-pound ($12.5 billion) plan to buy a satellite- TV service.
News Corp., based in New York, said this week it will close the 168-year-old News of the World, a move that failed to stem the company’s stock slide or silence calls for the ouster of Rebekah Brooks, CEO of the News International publishing unit. While Murdoch, 80, and Deputy Chief Operating Officer have both supported Brooks, U.K. Prime told reporters he would have accepted her resignation.
Brooks, 43, said in a letter to the U.K. Parliament’s Home Affairs Committee published today, that she had no knowledge of any phone tapping and has no reason to believe any other of the company’s newspapers used the method to get stories. News International also manages The Times, The Sunday Times and daily tabloid The Sun.
Brooks told News of the World employees yesterday she will try to find them jobs after the newspaper shuts down, while signaling she will remain in her post. All the newspaper’s employees, about 200, will be paid for the next three months, she said.
Murdoch plans to arrive tomorrow.
Shares of News Corp. and BSkyB, the U.K.-based broadcaster it partially owns, have fallen since accusations that its journalists hacked the phones of murder victims and the families of soldiers who were killed in Afghanistan.
News Corp., which operates the Fox television networks and film studios, the Wall Street Journal newspaper and book publisher HarperCollins, fell 68 cents, or 3.9 percent, to $16.75 yesterday in Nasdaq Stock Market trading. The shares were down 7.3 percent for the week. BSkyB fell 7.6 percent yesterday to 750 pence in London, and lost 12 percent this week.
Bloomberg LP, the parent of Bloomberg News, competes with News Corp. units in providing financial news and information.
Coulson, 43, who resigned as press chief in January, was arrested in connection with the phone-hacking probe and an investigation begun this week into claims the tabloid paid police officers for stories. The arrest is the highest-profile so far in the investigation that has ensnared seven people, including six with connections to the paper. Coulson has denied any knowledge of illegal activity when he was editor from 2003 to 2007.
News of the World’s former royal reporter, was re-arrested yesterday and his office at the Daily Star tabloid was searched. London police confirmed they arrested a 53-year-old man and searched his home in Surrey, Englan, yesterday and also raided a London business.
A 63-year-old man was also arrested at a residence in Surrey in connection with the investigation, police said yesterday without identifying him. The 43-year-old man and a 53- year-old man were released on bail, police said in an e-mailed statement without disclosing the names.
Brooks hinted she expects more damaging information to surface. She said that eventually it will come out why things went wrong and who was responsible, and that will be another very difficult moment in this company’s history.
Brooks told News of the World staffers she was among those betrayed by the acts of others. She rejected resignation, saying she is much more useful leading the company through the crisis.
Brooks became head of News International in 2009 after serving as editor of The Sun for 6 1/2 years. Beginning her career as a feature writer for the News of the World in 1989, Brooks rose through the ranks and was editor of that newspaper from 2000 to 2003.
Criticism of Brooks intensified this week with a report that in 2002, when she was editor, the News of the World hacked into the phone of murdered schoolgirl Milly Dowler and deleted voice-mail messages, misleading her parents into thinking she might be alive and complicating the police investigation of her disappearance. Before this week, the phone-hacking scandal had centered on celebrities, politicians and athletes.
Brooks said in her letter to the U.K. lawmakers she wanted to be absolutely clear that as editor she had no knowledge whatsoever of phone hacking in the case of Milly Dowler and her family, or in any other cases during her tenure.
News Corp.’s decision to close the Sunday tabloid came after companies halted advertising in the paper to protest its activities.
The company now needs to find new revenue sources to replace the sales lost in the shutdown. It may add a Sunday edition of the daily Sun.
A website titled thesunonsunday.com was registered July 5. The company hasn’t made any decisions on any new publications or expanding existing ones, Brooks said in the memo.
News Corp. can quickly regain advertisers trust with an overhaul of the outrageous journalistic practices that led to News of the World’s closure. If the company in the next couple of weeks creates a new News of the World with much more ethical behavior, advertisers will return.
A final edition of the News of the World, to be published tomorrow, won’t carry commercial advertising, and News Corp. has offered its ad space to charities. So far household name charities have turned down the offer, preferring not to be associated with the tabloid.

F.C.C. Ownership Ruling

In a narrow ruling unlikely to have an immediate effect on current broadcasters, a federal appeals court on Thursday overturned a 2008 decision by the Federal communications Commission to relax restrictions on cross-ownership of newspapers and broadcast outlets in the same city.
The United States Court of Appeals for the Third Circuit, based in Philadelphia, did not rule on the merits of the 2008 regulatory changes, which made it easier for a single company to own both a station and a newspaper in the same locality. Instead, the court said that the F.C.C. had failed to allow sufficient time for official notice and public comment on the new rules, as required by law.
The ruling Thursday essentially sent the issue back to the F.C.C., which is undergoing a mandatory re-evaluation of ownership rules anyway. At the same time, the court upheld most of the media ownership rules handed down by the commission in 2008.
In a statement, the general counsel for the F.C.C., took no notice of the cross-ownership ruling and instead cited the court’s approval of the other rules for ownership, saying that the decision affirms the F.C.C.’s authority to promote competition, localism and diversity in the modern marketplace.”
But counsel for Free Press, a public advocacy group that supported the challenge to the 2008 ownership standard, said that today’s decision is a sweeping victory for the public interest because it concluded that competition in the media — not more concentration — will provide Americans with the local news and information they need.
The head of Media Access Project, one of the groups that brought the case — and the lead lawyer for those groups — acknowledged that the ruling did little more than bounce the issue back to the F.C.C., which will include it in the reassessment of rules that the commission is mandated to make every four years. He also said the more immediate impact would come in the radio business, where efforts by some companies to expand the ownership limits — currently up to eight stations in a single city — were rejected.
The broadcast ownership rules have always been politically charged, with Republican administrations arguing for almost unfettered freedom to own stations and Democratic administrations pushing for limitations to enhance diversity and avoid dominance by the largest media voices. He added that it was possible and even likely that the current F.C.C., which he said seemed more focused on Internet issues, could reinstate the 2008 rule. And then they will take it up again in court.

07 July 2011


Wimbledon is leaving NBC after 43 years and appears headed to ESPN.
NBC said in a statement Sunday that while they we would have liked to have continued their relationship, they were simply outbid.
A person with knowledge of the negotiations confirmed that ESPN was working on a contract with the All England Club to televise the entire Grand Slam tournament. The person spoke on condition of anonymity because the deal was not ready to be announced.
ESPN had owned the rights to extensively televise early rounds of Wimbledon, with NBC picking up coverage as the tournament progressed, culminating with the Breakfast at Wimbledon broadcasts of the finals.
It would be the latest major sporting event to move from the traditional four over-the-air networks to cable. College football's Bowl Championship Series title games are on ESPN, and NCAA basketball's Final Four will be on TBS in alternating years starting in 2016.
Months into its new partnership with Comcast, NBC is losing a marquee event. The network did keep an even bigger one when it outbid ESPN and Fox last month for four Olympics.
This year was the 32nd anniversary of "Breakfast at Wimbledon," with coverage ending Sunday in the men's final.