The eyes trained on the scandal over Bill O’Reilly aren’t just American ones. As Rupert Murdoch weighs the Fox News host’s fate, with an ouster seeming imminent, observers on the other side of the Atlantic are watching closely as well.
What they see unfold over the next 24 to 48 hours could affect Murdoch’s quest to expand his presence on the European broadcasting scene. In Britain, where James Murdoch has already been faulted by the government for past “failures of corporate governance,” regulators are now wrestling with whether 21st Century Fox would be a “fit and proper” owner of Sky, the pan-European broadcaster that Fox is trying to take over and the Murdochs have long coveted.
That has upped the pressure on – and scrutiny of – the Murdochs’ handling of the O’Reilly crisis. It has also revived uncomfortable memories of how a previous news scandal, Britain’s phone-hacking affair, torpedoed their earlier bid to acquire Sky.
Critics have already lined up to urge British regulator Ofcom to say no to the new takeover bid. One person who recently sent a letter to the agency from all the way across the Atlantic: Lisa Bloom, the attorney representing women who accuse O’Reilly of sexually harassing them.
“The similarities between the current harassment scandal and the phone-hacking scandal reveal the company’s approach to business and management – a lack of oversight, intervention, and decency,” Bloom wrote to Ofcom, in a little-publicized letter dated April 11. She lambasted Fox News for its “utter disregard for the rights of women.”
Ofcom is expected to deliver its verdict on the takeover bid by May 16. Whether the O’Reilly factor will figure into its deliberations is unclear, however.
According to some analysts, the agency is limited in what it looks at, and while it does take into account any criminal investigations, the mere fact of sexual harassment lawsuits and settlements at a company is no way disqualifying. Otherwise, “not one broadcaster would pass the ‘fit and proper’ test,” noted Claire Enders of London-based Enders Analysis.
Still, the controversy has raised echoes of the 2011 phone-hacking scandal, in which reporters at Murdoch’s British newspapers illegally tapped into the voicemails of celebrities, politicians, and even a murdered teenager. With the O’Reilly affair, again “you have a corporation which allows its talent to get away with breaking ethical guidelines,” British media commentator Roy Greenslade said. “It has a track record which suggests it breaks the rules, and that is something that should be taken into account by any regulator, especially one that is about to give a company huge leeway in media dominance.”
Reports say Rupert Murdoch is more protective of O’Reilly than are his sons James and Lachlan, who see the embattled host as a liability. Murdoch prizes loyalty, a trait that was also on display in the phone-hacking scandal. But the evidence also suggests that personal loyalty gets sacrificed, in the end, to his wider business interests.
In 2011, he staunchly defended Rebekah Brooks, the protegee who oversaw his British newspapers, including the News of the World tabloid, which sat at the center of the hacking scandal. After flying in to London to deal with the fast-escalating crisis, Murdoch was asked by reporters what his top priority was. He gestured towards Brooks and said: “This one.”
Yet within days, the News of the World was summarily shut down, the politically toxic Murdochs were forced to ditch their bid to acquire Sky (then known as BSkyB), and Brooks resigned from her high-profile post, eventually facing criminal charges, of which she was acquitted.
O’Reilly is likely to be in for similar treatment from his big boss.
“He has seemed in the past to give the top priority to loyalty and ties of employment over corporate governance,” Enders said of the elder Murdoch. But “when things get serious enough, they’ll be weighing how it looks for their business as a whole.”
During the hacking scandal, the Murdochs were quickly abandoned by the politicians in Britain who had earlier curried their favor with alacrity. Since then, the family has tried hard to rehabilitate their image and their newspapers in the U.K., citing “lessons learned” from the crisis. Rupert Murdoch, who for a time was shunned by Downing Street, met with Prime Minister Theresa May last year.
But May this week called for a snap election to be held in Britain on June 8. That means that campaigning will have begun before Ofcom’s deadline for submitting its report on the Fox-Sky takeover. The agency’s recommendations will be delivered in an atmosphere in which many politicians will once again be eager to avoid any taint of close association with or accusation of going easy on the Murdochs at a time when their company is embroiled in another major scandal.
Avaaz, an activist group urging rejection of the takeover bid, said it would keep up the pressure.
“Murdoch’s Sky bid rests on his promise that he’s cleaned up his act since the phone-hacking scandal in Britain,” said Alaphia Zoyab, a senior campaigner with Avaaz. “But leopards don’t change their spots, and it’s no surprise that he’s being engulfed in fresh scandals with the same pattern of cover-ups and impunity in the U.S. Britain should reject the Sky bid to stop Sky being turned into Fox News.”