Murdoch: Rupert Murdoch's difficulties with the UK are mounting – and so are the UK's difficulties with Rupert Murdoch. The government's top spin doctor, Andy Coulson, quit on Friday amid continuing controversy surrounding the News Corp tabloid he once edited. The latest twist in this messy saga may not alter the course of Murdoch’s bid to take full control of UK satellite broadcaster BSkyB. But Coulson’s exit doesn't help the media mogul. Nor will it end questions about Murdoch’s links with Downing Street.
The crisis dates back to 2007, when a reporter from the News of the World and a private investigator were jailed for phone hacking. Coulson resigned as editor, but he was quickly snapped up by David Cameron to be communications chief of the Conservative Party. In hiring and then steadfastly defending Coulson, Cameron seems to have underestimated the durability of the scandal. The fact that Coulson has become a casualty of the affair adds to questions about Cameron's judgment. Still, this is hardly going to bring down his Conservative-led coalition government.
The development is also bad timing for News Corp’s bid for the 61 per cent of BSkyB it doesn’t already own. The government already faced huge pressure to refer the bid to the Competition Commission for a comprehensive assessment of its impact on media choice, given the concentration of newspapers already under Murdoch’s control.
But now it can only be harder for News Corp and the government to reach any pre-emptive agreement to get the deal through without a referral. That said, this was a remote prospect even when Coulson was in place. The scandal might not have gained such traction were it not for Cameron’s decision to hire Coulson and Murdoch’s own attempt to take full control of BSkyB. For his part, Coulson denies being aware of any wrongdoing at the tabloid while he was in charge. But many will ask why then he felt the need to step down, and whether the News of the World scandal has the power to inflict more damage on News Corp. With the paper having recently suspended one of its senior editors, Murdoch and News Corp are a long way from drawing a line under the affair. News Corp needs to get on top of this crisis.