Not only is Rupert Murdoch’s News Corporation embroiled in allegations of hacking into voice mails and emails, charges that led to him closing down the 168-year-old British tabloid News of the World and that have at least indirectly contributed to his son James Murdoch no longer being considered as the heir apparent to his father’s media empire. The Australian branch of News Corp. now also faces allegations of hacking and piracy in an attempt to sabotage its rivals in Australia’s pay television market.
On Wednesday, The Australian Financial Review and a documentary aired on BBC1 said that the NDS Group had hacked into satellite television companies and made pirate copies of their smart cards. News Corp. has minority ownership of NDS Group, a British-based technology television group, and also holds minority stakes in both cable companies BSkyB and Foxtel. NDS Group is accused of hiring hackers to acquire the codes of smart cards associated with subscription satellite services for rival companies including Austar and Optus. The codes were allegedly made available on the black market at a cost of $50 million a year to News Corp.’s rivals.
Not surprisingly, News Limited, News Corp.’s Australian unit, has denied any wrongdoing.
In the US, News Corp., which owns Fox News, is continuing efforts to expand its media holdings by creating a cable sports network to rival ESPN. While a decision has not yet been made, News Corp. executives have reportedly “held extensive discussions about creating a national cable sports channel,” says the New York Times. News Corp. might try to “re-brand” an existing channel, such as Fuel, whose focus is “thrill-seeking sports,” or the Speed Channel, which is based on car racing.
The New York Times points out that “if the plans come to fruition, it could set up a ferocious competition among several corporate parties,” including ESPN, Comcast’s NBC Sports Network, the CBS Sports Network and the Turner Network. Notably, the cable television rights to Major League Baseball and to the N.F.L. are up for renegotiation in the not-so-distant future. Currently, ESPN dominates in subscription fees for its sports programming, charging $5.06 a month per subscriber this year, while other channels charge less than a dollar.
If News Corp. does move ahead with its plans to create a sports channel, ESPN and the other companies had best be on their guard.
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