News Corp is moving towards the denouement of a drama that started 13 days ago with the relevation that the News Of The World hacked into the voicemail of murdered schoolgirl Milly Dowler in 2002.
On Sunday, Rebekah Brooks, News International's current chief executive, was arrested. The Wall Street Journal, owned by News Corp, said Brooks had not been charged as of early Sunday afternoon. On Friday Brooks offered her resignation to James and Rupert Murdoch for the second time. This time, her offer was accepted.
Saturday brought apologies from Murdoch and News International, in the form of full page advertisements in most of the UK's national newspapers.
Friday night, Les Hinton, chief executive at News International between 1995 and 2007, resigned as boss of Dow Jones, the News Corp subsidiary that publishes the * Journal*. It was Hinton, one of Murdoch's most trusted advisers, who assured Parliament in 2007 that the offenses that led to the jailing of News Of The World reporter Clive Goodman were an isolated aberration.
Spiky defensiveness has given way to profuse apologies. What was unthinkable 12 days ago has become necessary. Ahead lies a harsh test. Next Tuesday, James and Rupert Murdoch, as well as Rebekah Brooks, will face hostile questioning from the Commons Select Committee for Culture, Media and Sport. The outcome may determine News Corp's future not just in the UK, but in the US, too.
[partner id="wireduk"]Beneath the surface, the really important change may involve a shift in the relationship between Murdoch and his offspring. Friday, the Daily Telegraph reported that Elisabeth Murdoch is "furious" with Brooks, whom she accuses of having "fucked the company".
It's worth asking how Brooks -- or for that matter Hinton -- might have achieved this feat on their own.
Neither seems to know anything about what increasingly looks like a smoking gun: the unpublished 2007 internal investigation into phone hacking at the News Of The World that was kept hidden from the public, MPs and police. According to last week's Sunday Times, this document has caused those who have seen it to utter profanities similar to those favoured by Lis Murdoch.
On this basis, it's easy to conclude that Elisabeth Murdoch's anger may be partly directed toward her father. From the start of this crisis, Murdoch Senior seems to have allowed personal relationships drive his decision-making. As a result, his once-vaunted ability to divine the public mood has evaporated.
By any definition, Rupert Murdoch is now an elderly man. Fifteen years beyond the point at which he could have claimed a state pension in the UK, he continues to put in long hours as the chairman of News Corporation. Out of the blue, in an interview published yesterday by the Wall Street Journal, Murdoch told a reporter: "I'm tired."
This may explain why his decision-making has been so disastrous, his ability to assess the trajectory of this socially-amplified crisis so impaired. From the start, two weeks ago, his initial decision to hang out in Sun Valley rather than head straight to London looked ill-advised. Then, when Murdoch finally arrived, he allowed himself to be pictured smiling while reading the News Of The World in his car. This defiant gesture that may have gone down well with his hacks, but didn't charm parliament.
Having made 200 journalists redundant, Murdoch then placed his arm around Rebekah Brooks in front of the cameras and suggested that she -- rather than the parents of Milly Dowler -- was his first priority.
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Murdoch should have arrived in London with a new PR team. He didn't. Instead, his arrival became associated with the half-baked antics of Wapping's spin doctor Simon Greenberg, who told Radio 4's Today program on Monday morning that News International had been co-operating with the police ever since January.
Unbidden, Greenberg did what every PR knows to avoid. He answered the question: "When did you stop beating your wife?" The clear implication was that the company had been obstructing police inquiries until early 2011. As the week rolled on, the police became increasingly agitated by the leaks that continued to emanate from Wapping. If the aim was to get all the bad news out into the public domain as rapidly as possible in order to save the Sky deal, this strategy, too, failed abysmally.
Next came News Corp's withdrawal of the plan to hive off Sky News as part of the BSkyB deal. This technical maneuver meant that Ofcom would no longer be required to decide whether the Murdochs were "fit and proper" broadcasters. It made News Corp look like a wrongdoer trying to evade the consequences of its actions. Embarrassingly, it was followed 48 hours later by the abandonment of the Sky bid.
The same push-me-pull-you pattern repeated itself on Thursday. In the morning, the news broke that Rupert Murdoch had refused to testify in front of the Commons Select Committee. His son, James, replied that he was simply too busy to attend until mid-August (when, rather conveniently, Parliament will have broken up for the summer holidays).
Then came the climb-down. Late on Thursday afternoon, having received a summons from the Commons' serjeant-at-arms, the Murdochs decided to attend the hearing.
Most remarkable of all, perhaps, was the absence of any formal apology from Murdoch Senior. In any crisis, set-pieces of sorrow and regret create a firebreak beyond which critics cannot venture. Last week, we heard apologies from both James Murdoch and Rebekah Brooks. Yet from the Sun King himself, we heard nothing until yesterday, when News Corp's newly-appointed PR advisors arranged a private conversation between Murdoch Senior and the family of Milly Dowler.
Last week, it was reported that Murdoch thought the crisis would "blow over". His actions suggest that this was his view. Only yesterday, he told the Wall Street Journal that News Corp's "reputation of great good works in this country" would allow the company to quickly recover from any damage. News Corp, he said, had handled the crisis "extremely well in every way possible," making just "minor mistakes".
Investors reading comments such as these are entitled to wonder whether Murdoch remains fit to be the chairman of a publicly-quoted company. The reality is that his management of the crisis has left News Corp -- an otherwise smart and innovative company -- looking shifty, cynical, and arrogant. So far this week, the value of its shares have fallen by 14 percent. The hit to market capitalisation amounts to over $7bn.
The departure of Brooks and Hinton, plus the arrival of new heavyweight PR advisors, suggests new urgency. If the PR professionals really are in charge now, what's the endgame?
The News Of The World is gone. The bid for Sky is dead. The need remains to secure the Murdoch succession. News Corp must also restrain the contagion in the US.
Until yesterday, Murdoch Senior was visibly undermining News Corp's ability to achieve these objectives. In three days' time, we'll find out precisely much damage has been done, when the Murdochs and Brooks come face to face with their chief tormentors in the House of Commons.
MPs on the Committee like Tom Watson and Chris Bryant possess a forensic knowledge of the case. They have been misled by News Corp previously. Their hostility will be overwhelming.
In this lion's den, the Sun King needs to push all the right buttons. If he fails, he himself will become vulnerable.
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