Page 6 - AIB | The Chanel | Issue 2 2011

Dutch retreat behind their dykes
THE CHANNEL | MEDIA MARKETS
A far-reaching plan to reform
public broadcasting in the
Netherlands has been
announced by the minority
government of Liberal VVD and
Christian Democrats, with
domestic PSBs to be cut from 21
to 8 through mergers by 2016.
International broadcaster
Radio Netherlands Worldwide is
to bear the brunt of the
measures, with its budget cut
from EUR46m to 14m by 2013
and a reduction in activities with
two of the broadcaster's current
tasks - providing information for
Dutch people living abroad and
presenting a realistic image of
the Netherlands to the rest of
the world - scrapped. Instead,
RNW is to focus exclusively on
bringing reliable and
independent information to
people in countries where there
is little or no press freedom.
RNW DG Jan Hoek (right) is
now faced with devising and
implementing a colossal down-
scaling of a well-respected
organisation and the associated
redundancy planning. He said:
"In today's international world,
each self-respecting country has
to live up to its responsibilities.
The Education and Culture
Ministry (OCW) is making it
Few would have predicted that
one of the world's largest media
companies, seen almost
constantly in expansion mode,
would be brought to its knees by
a case of phone hacking.
Yet this is what has happened
to News Corp, the print-to-pay-
TV media company headed by
Rupert Murdoch, the newspaper
proprietor who kick-started the
satellite TV industry a quarter of
a century ago. Operator of right-
wing Fox News in the US, owner
of the Fox film studios, TV sports
networks and significant share-
holder in the Sky TV brand in the
UK, Germany and Italy, not to
mention Foxtel in Australia,
Rupert Murdoch has been
courted by politicians the world
over in an attempt to secure his
papers’ support at election time.
Now the Murdoch empire is
starting to crumble after revelations
of phone hacking in the UK by
one of his tabloid papers, the mass
circulation News of the World.
Evidence that phone hacking was
widespread - including mobile
messages of missing schoolgirl
Milly Dowler, later found murdered,
and the families of dead soldiers
as well as public figures and
celebrities - eventually led to the
closure of the paper by Murdoch.
The resignation of Rebecca Brooks,
former editor of the NOTW and
subsequently Chief Executive of
News International, followed.
The revelations came as
Murdoch's US$12bn bid for the
remaining shares in the hugely
profitable BSkyB business not
already owned by News Corp
was under review by the UK
authorities. As more evidence
poured out of Murdoch’s UK
newspaper businesses and
under immense pressure from
UK politicians and public opinion,
he took the decision to drop the
bid. The News Corp share price
tumbled as institutional
shareholders took fright.
The implications for the News
Corp business are significant. If
the BSkyB bid comes back to the
table, it is likely to be subject to
considerable investigation and
multiple objections. Already before
the hacking scandal, News Corp
was forced to agree to hive off Sky
News into a separate company not
directly controlled by News Corp,
as a price for the bid to go through
Britain's regulatory process.
There are perhaps wider
implications. Sky News Arabia, a
joint venture between BSkyB and
the Abu Dhabi Media Investment
Corporation, is due to launch in
April 2012. As further damaging
details emerged, and Rupert
Murdoch and his son James
appeared before a UK
parliamentary committee to
answer questions on the
06 | ISSUE 2 2011 | THE CHANNEL
impossible for us to do this.
Without any preliminary
research, nor any consultations,
a decision has been taken that
will leave a global audience of
millions out in the cold, and will
cost 250 jobs."
The cuts come as RNW
reports significant advances in
reaching audiences in many
parts of the world, with hundreds
of partner stations in Latin
America taking RNW programming
while innovative partnerships
with mobile operators in India
start to deliver massive numbers
of listeners among mobile phone
subscribers.
scandal, Sky News Arabia issued
a statement saying "Both [JV]
organisations remain committed
to the launch".
Despite the assurances being
given, if News Corp suffers
further embarrassments, the
launch of the Arabic-language
service could be affected. It is
worth noting that 7% of News
Corp is owned by Saudi billionaire
Prince Alwaleed bin Talal bin
Abdulaziz Al Saud.
This is a story that will
continue to make the front pages
and lead bulletins for some time.
And it says something about the
scale of the risk to the News
Corp empire that Rupert
Murdoch has felt compelled to
run personally signed letters in
UK newspapers - his rivals -
saying "We are sorry" and has
called his appearance before the
UK parliamentary committee
"the most humble day of my life".
The Fall of the
House of Murdoch?