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Crisis, what crisis? Murdoch is defiant as daughter Elizabeth and PR man husband Matthew Freud orchestrate fightback

You don’t get to be Rupert Murdoch by rolling over before a bunch of UK MPs who have (belatedly it must be said) decided that it’s time to cut you and your media empire down to size.

Well actually on this occasion Rupert Murdoch and his son James have; agreeing to appear before a Parliamentary committee on Tuesday after first declining the MPs’ kind offer.

At first they said they weren’t coming (James said he might be able to fit them into his busy diary in August) but then they received an official summons and one of their lawyers pointed out that they could be imprisoned if they didn’t turn up.

But, Rupert being Rupert, he’s taken the opportunity in his own Wall Street Journal to state some of his case.

In an interview with the WSJ late last night he said he wanted to address “some of the things that have been said in Parliament, some of which are total lies. We think it’s important to absolutely establish our integrity in the eyes of the public. …I felt that it’s best just to be as transparent as possible.”

He also said his company News International, publisher of the now defunct News of the World, had handled the crisis “extremely well in every way possible,” making just “minor mistakes.” He added that London law firm Harbottle & Lewis, initially hired to investigate the extent of phone hacking at the paper, had made a “major mistake” in underestimating the scope of the problem.

One can see the glimmer of a defence strategy here: it was all (or mostly) the lawyers’ fault.

The problem for Murdoch and son James, and NI CEO Rebekah Brooks who is also to attend the hearing, is that, although evidence at this will not be given on oath it most certainly will at the subsequent judge-led public inquiry which the three will be required by law to attend.

So telling the truth on Tuesday would seem to be the wisest course of action, however inconvenient it may be.

Of more pressing concern to the Murdochs, and the shareholders in master company News Corporation, may be the opening of a probe by the FBI into whether employees of News Corp might have hacked or attempted to hack into the private calls, voice-mail messages or call records of 9/11 victims or their families.

The investigation began yesterday morning, following a request a day earlier by Republican congressman Peter King from New York who heads the House Homeland Security Committee and whose Long Island district was home to many victims of the 2001 terrorist attacks.

How this will all play out is anyone’s guess but what’s certain is that the empire is fighting back and the driving forces, apart from Rupert himself, are daughter Elizabeth (who’s just sold her production company Shine to News Corp for £400m) and her husband Matthew Freud, owner of the UK’s most high profile and aggressive PR company.

News International in the UK this week hired the services of PR firm Edelman (Rupert could hardly spend the company’s money with his son-in-law). But this appointment also shows the hand of Freud. Global firm Edelman (run by Richard Edelman, the son of the company’s founder) is independent, just like Freud Communications is now, and famous for its ability to gain access to important people on the global stage.

Richard Edelman (pictured) networks the world like a combination of former UN secretary-general Kofi Annan and new IMF chief Christine Lagarde.

Since Rupert Murdoch returned to London to handle the crisis personally Elizabeth has rarely been far from his side although most of the photos have majored on him and Brooks. The hand of Freud, a notoriously adroit behind-the-scenes fixer was surely evident in the dramatic closure of the News of the World.

This didn’t strangle the current phase of the crisis at birth and save the bid for BSkyB, as many people supposed it had been intended to. Freud is too much of a realist to expect that to happen but it did at least get News Corp on to the front foot.

A combination of Freud in the UK and Richard Edelman in the US is probably about the best News Corp can do.

Was Murdoch’s improbably impenitent line in the WSJ interview partly on Freud’s advice?

It’s rather like the strategy BP’s Tony Hayward adopted in his disastrous response to that other recent corporate disaster Deepwater Horizon (we mustn’t forget that people actually died in that), play tough at first and then your subsequent apology will have more impact.

But, unlike Hayward, Murdoch actually is tough.

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About Stephen Foster

Stephen is a former editor of Marketing Week and London Evening Standard advertising columnist. He wrote City Republic for Brand Republic and is a partner in communications consultancy The Editorial Partnership.
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