Murdoch drops bid for British Sky Broadcasting

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Wednesday’s debate centered on a motion declaring that Murdoch’s bid for BSkyB would not be in the national interest. All three main parties had vowed to back the nonbinding motion.

The debate went ahead after Murdoch withdrew his bid, and the motion was approved without a formal vote, in a chorus of “ayes.”

News Corp. lost several billion dollars in market value after the scandal broke last week, but its shares rallied after the company said Tuesday that it was buying back $5 billion of its own shares. Shares rose 71 cents, or 4.6 percent, to $16.06 in afternoon trading in New York.

For Murdoch, it was a dramatic reversal. For three decades, the Murdoch media empire has had near-mythic powers among British politicians to destroy careers and determine the result of elections. After the Conservatives triumphed in the 1992 election, the Sun blared in a front-page headline “It’s the Sun wot won it” — and few doubted that it was true.

Steven Barnett, communications professor at the University of Westminster, said Murdoch’s retreat signaled a new era in British political life.

“This means the British Parliament has discovered its spine,” he said. “After 30 years of successive governments caving in to powerful media corporations, finally Parliament has realized it has to take a stand.”

It was a bitter irony for Murdoch that it was the News of the World, his first British acquisition in 1969, that sabotaged his ambitions to control the nation’s most profitable broadcaster.

Its ramifications for News Corp. and its executives — particularly Murdoch’s son James, head of News Corp.’s European and Asian operations, and the chief of its British division, Rebekah Brooks — are still playing out.

The scandal claimed a senior casualty Wednesday as News International, the company’s British unit, said its legal director, Tom Crone, had left the company. Crone led an internal inquiry that concluded only two people at News of the World had been involved in phone hacking — a stance that collapsed as numerous revelations tumbled out this year.

Cameron has struggled to control a spiraling scandal that includes his own former communications chief, Andy Coulson — an ex-News of the World editor — being arrested. The prime minister announced he was putting senior judge Brian Leveson in charge of an inquiry into phone hacking and alleged police bribery by the tabloid.

The inquiry will be able to compel witnesses — including government figures — to give evidence under oath.

Leveson will first investigate the culture, practices and ethics of the press, its relationship with police and the failure of the current system of self-regulation. The judge said the inquiry would begin “as soon as possible,” but that its second phase, examining what went wrong at the News of the World, would have to wait until the criminal investigation is complete.

Police are pursuing two investigations of News International, one on phone hacking and the other on allegations that News of the World bribed police officers for information. Police have indicated the bribery investigations involve about half a dozen officers.

Detectives have arrested eight people so far in their hacking investigation, including Coulson. No one has been charged. Cameron said police had the names of more than 3,700 potential victims, and would be contacting them all.

The allegation that Murdoch papers may have targeted 9/11 victims comes from the Mirror, which quoted an anonymous source as saying an unidentified American investigator had rejected approaches from unidentified journalists who showed a particular interest in British victims of the terror attacks. It cited no evidence that any phone had actually been hacked.

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