In the wake of its announcement that it will cleave its business into two separate publicly traded entities, News Corp. chairman and CEO Rupert Murdoch shot back at critics who said the split was motivated by a desire to ease political pressure from the months-long phone hacking scandal at its U.K. newspapers.
News Corp. has weathered a firestorm of criticism over the phone hacking scandal, where editors and reporters at its former News of the World tabloid were accused of illegally intercepting voice mails from celebrities and political figures. The most egregious of the charges against the paper, which News Corp. shuttered last year, was that employees hacked into the voice mail of 13-year old murder victim Milly Dowler. News Corp. has cooperated with officials throughout the investigation.
The scandal has caused some U.K. regulators to look into other aspects of News Corp.'s business -- with some questioning whether the company was fit to hold licenses for its British Sky Broadcasting satellite TV service.
In an interview with Fox Business Network Thursday, Murdoch told host Neil Cavuto that the split is in no way connected to the fallout from the hacking scandal.
"This is not a reaction," Murdoch said according to a transcript of the program. "This is looking forward to what is best for our companies and what's best for our shareholders."
Murdoch added that News Corp., which had tried to acquire the 60% of BSkyB it didn't already own last year but scratched that idea after it became apparent that regulators, chafing from the hacking scandal would not allow it, no longer has the appetite to own the rest of the satellite giant.
"[We've] moved on in our thinking now from that," Murdoch said.
Murdoch will serve as chairman of both entities when the deal is completed in about a year, and the company has already named chief operating officer Chase Carey to head up the media and entertainment unit. So far, no chief has been picked for the publishing unit. While Murdoch said the company will select a publishing chief in the future, he shot down speculation that his son Lachlan -- who had been deputy chief operating officer before resigning in 2005 to head up his own media investment company -- would take the helm. Whether his other children (deputy chief operating officer James Murdoch and television executive Elisabeth Murdoch) would take bigger roles after the split remains to be seen.
"Well, they have to earn it, and they have to want it," Murdoch said. "Lachlan is very happy running his own businesses in Australia. And he loves living there. So we'll see."