“Wednesday, March 28, 2012, is one day when The AFR, the world’s most expensive financial daily, is certainly worth its $3 cover price.”
Stephen Mayne is referring to The Australian Financial Review‘s front-page splash by Neil Chenoweth which chronicle the activities of a rogue division of News Corp which “… promoted a wave of high-tech piracy in Australia that damaged Austar, Optus and Foxtel as News was trying to take control of the pay TV industry”.
The scheme eventually left behind a $5 billion windfall for News Corp and a trail of destruction for its pay-TV competitors.
In the context of the phone hacking scandal in Britain, these revelations — essentially the Australian angle run in tandem with the BBC Panorama program that aired overnight — are explosive and widen allegations of corporate misbehaviour far beyond a couple of rogue journalists and a couple of rogue newspapers to ensnare News Corp’s real bread and butter: pay TV.
But when will these kinds of allegations begin to hit the company where it hurts — the share price?
As Mayne points out in Crikey today: “Amazingly, News Corp’s share price has soared ever higher in recent months and jumped another 10c to $19.48 this morning, valuing the company at $US51 billion. The Murdoch family has a debt-free $6.5 billion stake in News Corp and appear to be financially unscathed from the British scandal.”
Perhaps these latest revelations will prove to be a tipping point, given that the “family’s biggest single earner over the years has been US programming pumped out through the world’s most lucrative global pay-TV distribution channels.”
Thanks to the work of Chenoweth and Panorama, News Corp no longer has the luxury of amputating their UK newspaper arm to make their problems disappear.
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