The phone hacking scandal engulfing Rupert Murdoch’s media empire overseas cost News Corporation $224 million in the fiscal year that ended June 30, the company announced on Wednesday. In the last quarter alone, News Corp. spent $57 million related to the investigation.
Overall, the media conglomerate posted a quarterly net loss of $1.6 billion. The loss reflected a $2.9 billion “restructuring charge” related to its publishing business. The company intends to split its entertainment and broadcast assets from its publishing businesses, which include newspapers and book publishing. The company’s publishing income continued to fall last quarter.
Even with the corporate split, the hacking scandal shows no signs of relenting. Late last month, British police announced charges against prominent former News of the World employees, including Rebekah Brooks and Andy Coulson.
Brooks, the former News of the World editor and former News International chief executive, faces phone-hacking charges in addition to allegedly perverting the court of justice. Coulson, who was the tabloid’s editor during the alleged hacking, faces hacking charges as well as perjury charges. Coulson most recently served as UK Prime Minister David Cameron’s communications chief.
In a statement released with the company’s earnings, Murdoch said News Corp. continues to “innovate, grow and consistently adapt to the changing media industry landscape.” The company will “only be enhanced” by the planned corporate split, he added.
David Taintor
David Taintor is TPM’s News Editor. He contributes to TPM’s Livewire coverage, among other areas. David is from Chanhassen, Minnesota, where, yes, it gets very cold. Reach him at taintor [at] talkingpointsmemo.com
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