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Documentary, Murdoch Part 2
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00:01Rupert Murdoch is one of the most powerful and most divisive media lords on the planet.
00:08He's a pragmatic, some would say ruthless, you know, operator who is determined to get, you know, what he wants.
00:14Don't get between Rupert Murdoch and a dollar bill. He'll run you over.
00:18He's curious and a visionary and a maverick. He's a game changer, really. That's who he is.
00:25As his empire advanced relentlessly across the globe, from Australia to London to New York and Hollywood,
00:34so did his influence and his appetite for more.
00:38Like the late Führer, he controls the media for his own personal benefit. He is power crazed, I think.
00:48Presidents and prime ministers beat a path to his door.
00:52Rupert was a very powerful individual. He could be a pretty dangerous opponent.
00:57And whether you were a Hawke or a Keating or indeed a Fraser or a Howard, you took no to him.
01:03You didn't want to dismiss him.
01:05I've got to like him more and fear him less now that, you know, there's nothing he can do to put me in power or not put me in power or whatever.
01:11But the house that Murdoch built nearly crumbled to dust.
01:18As the 80s came to a close, Murdoch was about to stake everything on the biggest gamble of his life.
01:26One that would bring him and the company he had built up over 40 years to the brink of collapse.
01:34For years, Australia's media was fought over by two warring moguls.
01:46Rupert Murdoch and Kerry Packer.
01:51While Murdoch became a world player, Packer stuck to his home base,
01:57dominating the magazine market and building up the most successful commercial TV network, Channel Nine.
02:04I said to Rupert, what do you think of Kerry Packer?
02:08And he said, too powerful.
02:14I thought that was paradoxical.
02:17I wonder what that meant. Do you think too powerful for Rupert's comfort?
02:22Distinguished television journalist, Gerald Stone, worked for both Packer and Murdoch at different times in his career.
02:31Kerry Packer was fascinated with Murdoch, but he had great respect for Rupert's competitiveness.
02:37Kerry was a very competitive man himself.
02:40I would call Rupert coldly calculating.
02:44Kerry made people passionate to do things.
02:48Rupert made them want to succeed and be very competitive.
02:52But I don't think he ever had the passion that Kerry Packer had.
02:57Rupert was the total workaholic.
03:00The seven day a week person with few interests outside of his business.
03:07Kerry took lots of time off.
03:10His view of the world was, I've got plenty. I'm going to enjoy it.
03:14I don't think Rupert ever took that view.
03:16Rupert's view was, I've got plenty. I want more.
03:19Murdoch and Packer would soon be embroiled in another turf war.
03:24But before then, thousands of miles away, Murdoch had another battle to fight.
03:30In June 1988, Rupert Murdoch took aim at the British television market.
03:42He staked his reputation and his empire and launched Sky Television, Britain's first pay satellite TV service.
03:51The story of Sky is the story of Rupert.
03:55We bet the whole goddamn lot on making this work.
04:00We are seeing, I think, the dawn of an age of freedom for viewing and freedom for advertising.
04:09He was incredibly excited, of course he was.
04:11He was doing something that a lot of people had thought could never happen.
04:15You know, satellite television, 24-hour news, that's never going to catch on, is it?
04:21Until then, British television had been the fiefdom of the free-to-air established broadcasters.
04:28And they didn't take kindly to the tabloid warrior trying to take over their turf.
04:34Now, what are you telling viewers they'll be able to see on your channels?
04:37Will they be able to see the kind of quality material of your Sunday Times and your Times newspapers?
04:41Or are they going to be looking for page three of the Sun or the news of the world?
04:44Well, I think you can be pretty confident it won't be page three of the Sun.
04:47We like to keep that exclusive.
04:49I'm very confident in the programming that Mr Murdoch is going to put on on these four channels.
04:55Sky planned to start broadcasting in just eight months.
04:58And none of Murdoch's team had done anything like this before.
05:03The main risk was I didn't know what I was bloody doing.
05:05I never knew how to make a satellite dish, never knew how to make a satellite receiver.
05:09But that's another point. That's my business, right?
05:13Mr Murdoch said, would you like to start a television channel?
05:16And I said, sure, where?
05:18He said, London. And I said, when?
05:21He said, February. I said, February when?
05:23He said, February next year.
05:25I said, holy shit, I better get going. He said, yeah.
05:27And he then took a phone call and kind of like motioned me out. And that was it.
05:32Mr Murdoch.
05:34Everybody else told us it would fail.
05:37This was Rupert Murdoch at his best.
05:40Coming to the outside to take on powers that believe they're unassailable.
05:44I will never forget the night we were launching the satellite from French Guiana.
05:52And it didn't, the rocket didn't go up the first night.
05:54And he started calling and calling the second night.
05:56I said, I promise you, the moment I know it's going up, you know.
06:00And he called back again. I said, what's the, he said, Andrew, I'm betting the whole company on this.
06:05The whole company's bet on this rocket going up.
06:08One, two, one, double.
06:20But few of his colleagues knew that Murdoch was up against a financial wall.
06:24Looking great.
06:26To launch Sky, he'd put his whole empire in hock to the banks.
06:34Welcome to Sky Television.
06:37February 5th, 1989. The dawn of television's new age.
06:42At six o'clock, Murdoch switched on Sky's four channels for the first time.
06:47Good evening. You're watching the world news from Sky Television.
06:50News on the hour, every hour.
06:52But back on Earth, almost no one was watching.
06:56Well, joining us now, direct from Sky Television's headquarters,
06:59is John O'Lone, who's Head of News at Sky. Good morning.
07:02Good morning.
07:03What's your estimate of how many people watched last night?
07:06In the newsroom, I think there were about 250.
07:09Anyone else outside?
07:11Off the satellite, I know I got calls from my family,
07:15who thought it was very good.
07:17It was a hell of a risk.
07:20But there is that saying, particularly in News Corp,
07:23when you find you're in a hole, you just dig faster.
07:27Welcome back to Sky News at 21 minutes past 11.
07:30Nobody had heard of Sky.
07:31The joke was that even in the early days,
07:34more people had seen the Loch Ness Monster than had seen Sky Television.
07:41But then, as 1990 got underway, a real monster reared its ugly head.
07:50A world recession.
07:53What sort of pressure are you under from the banks?
07:56Any?
07:57No, we're under no pressure at all.
07:58We enjoy the confidence of our banks.
08:00We've never misled them.
08:02And we're not under any pressure.
08:05The truth was, Murdoch was under tremendous pressure.
08:09His relentless expansion had left his company drowning in debt.
08:14And he had refused to listen to warnings of a looming crisis.
08:19Well, I was very worried.
08:21And it was my fault.
08:22I had ignored a lot of advisers that we should, when times were good in the late 80s,
08:27and take on a lot of public debt.
08:28But that meant that it was much higher cost of interest than borrowing from banks.
08:33And they remained dependent on the banks.
08:35And the banks were getting scared as they were under a huge squeeze themselves.
08:39To help him save his empire, Murdoch's bankers drafted in a cracked team of financial advisers from New York and London.
08:48They set to work to sort out the mess.
08:51We explained to him that there was an enormous amount of debt, over 7 billion, probably closer to 8 billion dollars of debt.
08:59And we eventually found out there were 146 banks lending differing amounts of money to different parts of the business.
09:07Hello, good afternoon. It's 5 o'clock.
09:11By the end of its first year, Sky had lost 95 million pounds.
09:18Murdoch's empire was facing bankruptcy.
09:24He and his team travelled the globe to persuade all 146 banks to renew his loans and avert disaster.
09:33The company came very, very close to bankruptcy because there were several small banks who were very reluctant to go through with keeping their money in the company.
09:47One Australian bank was not prepared to take Rupert's calls.
09:51And we had to make every effort to get the chairman to accept that he should at least speak to Rupert Murdoch.
09:58When Rupert got on the phone, he still was not able to convince him, but agreed to fly out and meet with him in America.
10:06I think that was one of the occasions on which Rupert was really worried about whether this deal would go through.
10:17It teetered on the brink.
10:19And he has spoken to me about it, and I think for those days it was touch and go as to whether they could come through it or not.
10:26Murdoch came through the worst, but it took him another year of desperate negotiations with the banks to raise enough cash to stay afloat.
10:41We worked very hard, and we built back from it, and it was a pretty searing experience.
10:46This is the Sky Satellite Network.
10:52Murdoch sealed his place in British broadcasting history when Sky won the rights to Premier League football in 1992.
11:01Viewership took off, and Sky now turns over a billion pounds a year.
11:07But with his large stake in Sky, and his dominant newspaper empire, many complained that Murdoch had amassed an unprecedented monopoly of the British media market.
11:19Anybody could have started Sky Television. Anybody.
11:24And we started it. And people are still free to start against us.
11:28But they'd rather write articles, bitch and moan, lay around and say, no, we'd rather just keep our lazy way of life.
11:37We don't want to compete.
11:39Sky now reaches a third of British homes.
11:43Murdoch had changed the face of broadcasting in Britain.
11:47Now he planned to do the same on the world stage.
11:58Murdoch had taken on the TV big boys in Britain.
12:02But now he set his sights on the big three TV beasts in America.
12:07Back in 1986, he bought 20th Century Fox and six TV stations.
12:14They formed the nucleus of Fox, the fourth American network.
12:19But from the outset, Murdoch had a master plan that stretched beyond America's shores.
12:25It was clear that his ultimate ambition was much larger than just a fourth network.
12:32He wanted the ability to be able to reach the entire globe.
12:35So everything that we were doing in the United States was building a vehicle in the United States to fit into a much larger picture.
12:44To run Fox, Murdoch put Hollywood heavyweight Barry Diller in charge.
12:48But the network got off to a rocky start.
12:53Show after show failed to win an audience.
12:57And Murdoch demanded instant results.
13:01You know, Rupert doesn't have a lot of patience.
13:04He would say, I'm too old. We can't wait.
13:07And I would say, it takes the time it takes.
13:10It was about a year into Fox and he said, putting on all terrible programs and, you know, maybe you should run the movie company and let somebody else do this.
13:22And I said, I said to him, I said, no frigging way.
13:28I'm not doing that.
13:29It got very hot between us.
13:34But Diller's strategy paid off.
13:37Soon, they hit the jackpot with a cartoon show about a dysfunctional family.
13:42The Simpsons.
13:46I've been to the left. I'll get around here.
13:48Fox took off and Murdoch moved his family to Hollywood to take control of his burgeoning new kingdom.
14:01We're now at two senior executives, one the owner of the company and the other a senior executive, who are trying to manage the same operations.
14:10So Barry at some point said to Rupert, I'm either your partner or I have to leave because the two of us can't be managing the same company.
14:17And Rupert basically says I don't do partners.
14:20And so Barry left.
14:24Now in complete control, Murdoch put his own stamp on the new network, buying the rights to primetime NFL football.
14:32I was in shock.
14:34And all I could think about was Homer Simpson and the cartoon characters.
14:38And you've got to be kidding me, because that was my, my vision of what this network was.
14:43And he started saying, we're going to put the time in the top left corner.
14:48We'll put a box up there and you guys are going to be stars.
14:51And then I said, you're going to put stuff on the screen where people can see how much time is left.
14:55And like, oh, my God.
14:57It was like, oh, my God.
15:00What have I got?
15:01I can't.
15:05But it worked.
15:06The NFL gave Fox credibility and cash flow.
15:11Now it was in the same league as the big three American TV networks.
15:15If you believe in something, creative will back it, regardless.
15:20Murdoch liked the Hollywood prophets, but he didn't care for the Hollywood people.
15:26Rupert's a bit skeptical of Hollywood and a lot of the hypocrisy that you see in Hollywood.
15:32A lot of the, uh, the pure values that are espoused and then lives that are lived quite differently.
15:38But he enjoys ideas and creativity.
15:42And so he couldn't deny that in Hollywood.
15:44And I think it eventually got into his blood as well.
15:47Rupert is a maverick.
15:49In terms of Hollywood, mavericks seem to do well in Hollywood.
15:53Uh, people who don't mind taking a risk and people who have vision.
15:56And Rupert has vision, he doesn't mind taking a risk.
15:59And, uh, you know, you have to have a thick skin to survive in Hollywood.
16:03And, uh, he's got one of those.
16:05But the king of Tinseltown would soon be drawn to another battleground.
16:12One he hoped would deliver vast riches and his global TV dream.
16:18China.
16:20Murdoch has this quite extraordinary ability, I think, you know, to see round corners,
16:25to see opportunities where, where others don't.
16:28He went to China in 1985, took the family on a family holiday.
16:31At that stage, I mean, China was largely, you know, Mao suits and bicycles.
16:36And Murdoch saw a market, I mean, he saw, you know, a billion television eyeballs.
16:41And if you could crack this market, you know, you could make an absolute fortune.
16:45In 1993, Murdoch snapped up Hong Kong-based Star Television, shelling out over 500 million dollars.
16:58Its footprint covered 38 countries in Asia, with well over half the world's population.
17:04He will go out and he'll pay astonishing amounts of money for properties that he thinks are worthwhile.
17:11On the other hand, if you go into a budget meeting with him, he goes line by line by line,
17:16and he'll go even down to, like, somebody's expenses and say, well, did somebody travel first class?
17:22But Murdoch's ambition for Star went beyond mere profits.
17:29The staunch anti-communist hoped his new satellite venture would help remove the communist leaders of China.
17:36I think Rupert's ambition was to cause a change in the form of government and economy of China,
17:42by bringing to the Chinese people more information about the prosperity and freedom of people elsewhere in the world.
17:50Televisionary, Rupert Murdoch.
17:53As Murdoch prepared to make a keynote speech outlining his vision,
17:57his colleagues became increasingly worried about his politics getting in the way of business.
18:06Advances in the technology of telecommunications have proved an unambiguous threat to totalitarian regimes everywhere.
18:18He was advised by more than one person that that was basically setting a red flag in front of the Chinese bull,
18:26and that he should take that out. And he insisted on putting it in.
18:30Satellite broadcasting makes it possible for information-hungry residents of many closed societies to bypass state-controlled television channels.
18:42The speech was later called the most expensive 16 words ever uttered.
18:50Within a month, the Chinese government banned satellite dishes.
18:53All the bureaus of the radio broadcasting and film from the provincial bureaus all received instructions from the ministry,
19:04saying that, well, they're not allowed to deal with Rupert Murdoch.
19:07So it was very, very difficult.
19:10He realised that that had done him a lot of damage.
19:14And he knew, and so it was damage control time.
19:17With his multi-million dollar Chinese investment about to go down the drain,
19:23Murdoch ditched his political ambition and went into overdrive,
19:27now to placate the communist Chinese leadership.
19:30The BBC's World Service television channel is to stop broadcasting to China.
19:35First, he removed the BBC World Service from the Star satellite.
19:38It had been a thorn in the side of Beijing.
19:43Next, he tried to win them over with joint television ventures, technology projects,
19:49and even a lucrative book deal for the daughter of the paramount Chinese leader.
19:59But then, he was told that the former governor of Hong Kong, Chris Patton,
20:04a fierce critic of the Chinese leadership, was about to publish his memoirs,
20:09courtesy of HarperCollins, a Murdoch-owned company.
20:14Rupert merely got on the phone to somebody from HarperCollins.
20:18He was screaming, he was yelling, he was stomping the foot.
20:21I had a call from Rupert, and he said,
20:25I don't want to publish that man's book.
20:27I tried very hard.
20:28I said to him, this book will get far more attention if it's cancelled than if we publish it.
20:35But Rupert became adamant, dug his heels in, would not listen,
20:40and said he just did not want this to come out.
20:45And so, we cancelled the book.
20:50Patton's book was immediately picked up by another publisher.
20:53And of course, all the publicity made Patton's book a bestseller.
20:58Up to that point, it should have been quietly sort of disappearing into obscurity.
21:04Over the last 20 years, Murdoch has worked tirelessly to woo the Chinese leadership,
21:10to extend his television interests into mainland China.
21:13But his dream of a truly global TV network continues to elude him.
21:18Rupert Murdoch sees himself as a great agent of change.
21:20He thought, in China, money and persistence would allow him to finally break through.
21:26I think it's the one place where it didn't work.
21:29This is not a democracy.
21:31It's a system where flexing your media muscles doesn't buy you influence.
21:35And it's always sort of confounded him.
21:37I think, you know, of all his great ventures and all the things that he's done,
21:41it's probably, you know, he's one huge failure.
21:44Communist China had taught Murdoch an expensive lesson.
21:47From now on, he would use his political influence on more amenable nations.
22:02By 1994, Rupert Murdoch was set to do battle once again with his old foe, Kerry Packer.
22:08Packer owned Channel 9.
22:12Hi, Bob. How are you? How are you?
22:14Murdoch had been forced to give up his two Channel 10 television stations when he became an American citizen.
22:20But the Labour government was about to introduce Australia's first pay TV channels.
22:25And both men wanted a slice of the action.
22:31Kerry Packer and Rupert Murdoch didn't really differ on pay television's introduction into Australia.
22:38The only thing they differed on was who was to own it.
22:40Each one of them thought they were the right person to own it and run it.
22:43You said it. Thank you.
22:46Foxtel.
22:48Murdoch set up a joint pay TV venture, Foxtel.
22:52While Packer got into bed with another operator, Optus Vision.
22:58After the success of football on Sky and Fox, Murdoch set his sights on the ever popular Australian Rugby League.
23:05There was just one snag.
23:09Packer already held both the free to air and the pay TV rights to broadcast the league's games up until the millennium.
23:17And he wasn't about to give them up.
23:20I want it forever.
23:22I reckon rugby league and cricket, as far as I'm concerned, are the two great sports in Australia.
23:29Packer had forced the clubs to sign five-year loyalty agreements.
23:32Not to be outdone, Murdoch came up with a cunning plan.
23:39He who pays the most will get it.
23:42He instructed Ken Cowley, the chief of his Australian arm, News Limited, and his son, Lachlan, to set up a breakaway Super League.
23:51And he gave them $120 million to buy up the best players and clubs.
23:56We came in and of course it was unwelcome to Kerry Packer.
23:59Kerry was horrified.
24:03If you had Super League and Channel Nine didn't have Rugby League, then it was going to be a huge problem for Kerry.
24:09The Nine network had its cosy relationship with the Australian Rugby League, rudely interrupted by a company which was actually saying,
24:17Hey, it's not yours forever. We're going to compete.
24:21And it became an enormous war.
24:24Both camps slugged it out to buy up players and their clubs.
24:29The lure of the money was pretty great.
24:32And so we were never going to hold them all.
24:34And the initial raid, they got so many people straight away.
24:37Suddenly the amounts just tripled overnight.
24:42The ARL, backed by Packer, took Murdoch to court in a bid to stop the new competition.
24:49While we are disappointed at today's judgement...
24:53Murdoch lost the first round, but he wasn't giving up.
24:56All right, so you have the NFL in the United States.
24:59You have the soccer in the UK.
25:01It would be a nice trifecta to have the Rugby League.
25:04It'd be great.
25:06Maybe we'll come back to Rugby League one day soon.
25:08Or later. We'll see.
25:12More court action followed.
25:15Murdoch had no intention of backing down.
25:18Mr Murdoch, how do you see this Super League issue finally being resolved?
25:21Oh, I think I will win and the ARL collapse.
25:25Will there have to be a peace settlement day for the game to really survive, as people know?
25:29No.
25:31It'll have to go away.
25:33Finally, the Federal Court gave Super League the go-ahead.
25:37Well, we're wrapped, but, you know, we're very happy.
25:42But the euphoria was short-lived.
25:45Fans deserted the game in droves,
25:47angry at being forced to choose between rival competitions.
25:52The Super League ran on Foxtel for just one premiership season.
25:57Look, we are very happy with Super League as it is.
26:00Murdoch was hemorrhaging money.
26:03So far, the whole exercise had cost him more than $500 million.
26:08They're very welcome.
26:09It was an horrendously expensive exercise setting up the Super League.
26:13And eventually, common sense prevailed.
26:18Murdoch and Packer left it to their sons to reach an agreement.
26:22Lachlan Murdoch and James Packer brokered a truce.
26:26And the rival leagues were united in one competition.
26:30The National Rugby League.
26:31The games were broadcast, as they still are today, on Fox Sports and The Nine Network.
26:39Live on Fox Sports.
26:44Murdoch's next TV venture, in his adopted homeland, would be less troublesome.
26:49For years, he'd wanted his own TV news network in America.
26:52I'd just like to say, how delighted I am, that we can firmly announce the starting of a Fox News Channel.
27:02So in 1996, he launched Fox News.
27:06Good morning, welcome to Fox News Channel.
27:08This is Fox News Now, all the news...
27:09From the outset, Fox would pursue a right-wing agenda to counteract what Murdoch saw as the liberal bias of the established news broadcasters, including his arch rival, CNN, and its owner, Ted Turner.
27:24Like the late Führer, he controls the media for his own personal benefit.
27:34He is power crazed, I think, for money and power.
27:40We were not concerned about it particularly.
27:43In retrospect, we should have paid closer attention, in all honesty.
27:46And, of course, the essential thing that we missed was that it wasn't going to be just 24-hour breaking news.
27:52It was going to be mixing fact with opinion.
27:57It was going to be lacing polemics through the news.
28:01From the West Coast to the center of power in Washington, Fox News is now the most-watched cable TV news channel in America.
28:12But across the Atlantic, in Britain, Murdoch's politics were about to swing in the opposite direction.
28:17He'd backed Mrs. Thatcher's successor, John Major, through one election.
28:26Five more weeks! Five more weeks!
28:28But his government was in trouble.
28:31And it was open season in Murdoch's British papers.
28:34John Major was already in deep doo-doo, and we had been told very clearly that Rupert likes to back a winner.
28:46And he was not convinced that Jay Major would be a winner next time round.
28:50Suddenly, this young chap, who looked and sounded a bit like a moderate Tory, took over the Labour Party.
28:59Suddenly, there's a leader that he thinks he can do business with.
29:04With the British election two years away, Tony Blair enraged many in his own party when he flew halfway around the world to attend a News Corp conference on Hayman Island,
29:18in the hope of getting Murdoch and his British papers on side.
29:22The political damage that the Murdoch media certainly at the time could do was legendary.
29:31It was a big decision for us to go, and I decided to do it because, you know, the relationship between the Murdoch press and the Labour Party had been absolutely terrible.
29:40The Australian Prime Minister, Paul Keating, had also accepted Murdoch's invite to the conference.
29:48We have media in three continents, and Labour leaders like to trust and ties about the things they're doing.
29:54We're proud of what we're doing.
29:56So has the Labour government become too pal-y with Rupert Murdoch?
30:01Hi.
30:03Paul Keating said to me, look, Rupert could be a complete bastard, but he is someone you can deal with.
30:07And that, in a way, gave me confidence because I trusted Paul's judgement.
30:11Do you expect Mr Rupert Murdoch's papers to support you in the upcoming election?
30:16No, I mean, I've made it clear right from the very start, I'm not here to trade policy for an editorial support.
30:22What Mr Murdoch's papers do is up to him, what the Labour Party does is up to us.
30:27I felt that he wasn't, as it were, you know, your standard right-wing Conservative,
30:31that he was someone who was open to persuasion, someone who, you know, would, if they thought it right,
30:38or maybe even if they thought it convenient, but if he thought it right, would switch sides.
30:43In Australia, Murdoch had already decided to switch sides.
30:51He'd supported the Labour governments of Hawke and Keating for 13 years.
30:57But an election was looming, and the Liberal leader John Howard was the favourite to win.
31:03It was pretty obvious that the winds had shifted, and that John Howard was going to be in power.
31:10And of course Sir Rupert Murdoch wanted to be there with him.
31:13We want John! We want John! We want John!
31:16I thought I had a very fair run from the Murdoch press.
31:20Howard won the election.
31:22And, on the opposite side of the world,
31:25Howard's political opposite, but likely winner, was also about to get Murdoch's blessing.
31:33Not only did Murdoch's British tabloid, The Sun, back Tony Blair,
31:38he ordered all-out war on the Conservative Party he had supported for 18 years.
31:46Murdoch comes on the phone and he said,
31:49Neil, I'm coming down to see you. Click.
31:52And I'm thinking, what?
31:56Rupert comes straight up to me, and he said to me,
31:59you're not getting it. He said, we are backing Blair,
32:03we are backing the Labour Party to win this election.
32:07We are doing our best to destroy the Tories.
32:12He said, there's no two ways about this. He said, we're either in it or we're not, and we're in it.
32:16He said, so you back them 100%, and you go for the Tory party jugular.
32:23And I said, yes, sir.
32:26Tony Blair led Labour to a landslide victory in May 1997.
32:34In Britain and in Australia, the new Prime Ministers made personal efforts to keep Murdoch on side.
32:41If I heard he was in town, I'd probably have someone call up and say, you know, you should pop in and see me.
32:46Morning, Mr Murdoch.
32:48He would always come and see me. We would often have a meal together.
32:51But they would not always see eye to eye.
32:56He was a very strong Republican, but I wasn't.
32:59And his papers campaigned relentlessly and unceasingly in favour of Republicans.
33:05Murdoch's newspapers have consistently attacked the British monarchy.
33:10Howard committed his new government to a referendum on a republic.
33:18Murdoch personally entered the fray, issuing a front page appeal in his flagship, the Australian.
33:25Despite that, the Republican movement was comfortably defeated.
33:30The Australian people have said no.
33:33No.
33:35He's been quite vocal in his criticism of the monarchy.
33:41And he's not liked by the monarch.
33:44But I did meet him not long ago at a party at Buckingham Palace.
33:50And I said, Rupert, how strange to find you here.
33:53And he sort of laughed sheepishly.
33:57He said, well, you know, we had the invitation and I thought I'd come along.
34:02And he realised that this was something that a much more sophisticated diplomat than Rupert Murdoch,
34:11the Queen herself, had thought, what a good move that would be.
34:15I think there's no question that he has a grudging respect for the old lady.
34:23But one area where Howard and Murdoch did agree was changing the media ownership rules.
34:30As a naturalised American, Murdoch was prevented from owning a TV station.
34:36Within months of coming to power, Howard ordered a review of the existing rules.
34:41It was viewed as a payback for the support that Murdoch had offered Howard in 1996.
34:50And others, Kerry Packer and others, I mean, the Liberals swept to power.
34:56And most of the media proprietors supported that.
34:59I didn't make any secret deals with anybody in the media.
35:02I think it's absurd to put restrictions on what people could own.
35:06It was always something that, to me, seemed an unnecessary restraint.
35:15Howard's reforms repealed the rules governing foreign ownership of television.
35:21They came into force in 2007, enabling Murdoch to up his stake in Foxtel to 50%.
35:28But Australia is just one part of Murdoch's vast global empire.
35:37His newspapers were still his first love.
35:40And he was determined to keep tabs on them.
35:43The famous saying, the sun never sets for Murdoch.
35:47He was in constant motion.
35:48You know, if there was a bank holiday in America, chances are he'd get on his plane and go to London.
35:54So, where there wasn't a bank holiday and work there and vice versa.
35:58You know, when there was a bank holiday in England, he'd be over in New York.
36:02He couldn't stand to miss a day.
36:07But flying visits to his far-flung newsrooms often sparked off a panic.
36:11Word would come that he was on his way and we would move into a state of PMT, as we called it, pre-Murdoch tension.
36:19Everybody was then on sort of war alert.
36:21And the most dreaded words of all you ever heard were, Rupert's on his way down.
36:27And you'd go, how long have we got?
36:29It goes way past tension.
36:31It's borderline terror.
36:33Because one thing you know about Rupert is when he comes to town, people lose their jobs.
36:37It happens all the time.
36:38He'll have his meetings and then he'll get on a plane and then the bodies start falling down the elevator shafts.
36:48But Murdoch's constant travelling was also taking its toll on his marriage.
36:54He'd been married to his wife, Anna, for 30 years.
36:58Anna thought she had an agreement with Rupert that by the time he reached a certain age, he would begin to slow down.
37:05And she used to call him the perpetual motion machine because by this time he had a private jet and he was never off it.
37:13He slept in the jet. He was always travelling. She never saw Rupert.
37:17Rather than slowing down as he got older, he got even faster.
37:20The perpetual motion machine speeded up and she saw even less of him.
37:24And I think that hurt her and disappointed her deeply.
37:33It was on a trip to Hong Kong in 1997 for the handover of power to China that Murdoch met the woman who would change his life.
37:41A junior executive at Star TV, Wendy Deng.
37:48I do remember the occasion when I did introduce Rupert to Wendy.
37:51It was a cocktail party following the 1997 handover.
37:56And it was simply, you know, Rupert, Wendy, Wendy, Rupert.
37:59As I went round the room introducing him, you know, he kept gravitating back to Wendy.
38:05But, you know, little did I know that this was the start of a beautiful friendship.
38:10In April 1998, New York Post executive Ken Chandler was in his office when a colleague burst in to alert him to a breaking news story.
38:19And he said, you better look at this.
38:23So I read it and my jaw dropped.
38:28And it was basically an announcement that Rupert and Anna were splitting up.
38:35I read it again and then I read it a third time.
38:40And I was like, what? Is this some kind of joke?
38:44It was no joke.
38:4717 days after divorcing Anna, Murdoch, now 68 years old, married 31-year-old Wendy on board his yacht.
39:02Wendy helped Rupert discover his lust for life again.
39:06Rupert ran his first seven-minute mile when he was in his seventies.
39:11He has always made it pretty clear that he wants to live forever.
39:16He doesn't see any reason that he shouldn't be immortal and run the company forever.
39:20Thanks to Wendy's influence, Murdoch began to enjoy Hollywood and acquired some A-lister friends.
39:34She's got an enormous amount of energy and Rupert adores her.
39:41And I think she's a lot of fun.
39:44That's the thing about when she's fun and she's up for anything, which is good for Rupert too.
39:49A year after his marriage, Murdoch was diagnosed with a life-threatening disease, prostate cancer.
39:57He recovered, and remarkably, at the age of 70, he and Wendy had their first child, Grace, followed by Chloe two years later.
40:09I remember one of the first times I went around to Rupert's place for lunch, and it was the day after Christmas.
40:16Big family time. His family together were invited down to their country house.
40:19We had a great time.
40:21And at some point in the afternoon, I said to Deb, my wife, I said,
40:25Oh, you know, maybe we should, maybe we should go.
40:27You know, it was about four o'clock.
40:28And I said, you know, Rupert, thank you so much.
40:30And he goes, mate, why don't you stay?
40:31You stay.
40:32He goes, well, we've got, we've got some more food.
40:34Have another beer.
40:35What do you want?
40:36I feel that he really enjoys having people around.
40:39He loves big family atmosphere.
40:41He enjoys the dynamic.
40:44But all was not well with the children from Murdoch's previous marriage.
40:49His daughter, Liz, had left Sky TV back in 2000 to set up her own TV company.
40:56His eldest son, Lachlan, was his chosen successor.
40:59In 1999, Murdoch brought him over from Australia to work with him in New York.
41:07Everybody felt that Lachlan was in a very difficult position.
41:12I mean, how would you like to be following in Rupert Murdoch's footsteps?
41:17I mean, it's, it's a lose-lose, whoever you are.
41:22He tried to sort of put his stamp on things.
41:25At the same time, Rupert tried to step back and give him space.
41:32But neither of them were successful in either of those things.
41:36Lachlan left the company in 2005 and went back to Australia.
41:43But soon, Murdoch's dynastic problems would be the least of his worries.
41:48Thousands of miles away, a scandal was brewing.
41:52One that would rock him and his dynasty to its very core.
41:56For decades, Rupert Murdoch has been one of the most influential media barons in the world.
42:07Prime Ministers quartered him.
42:10And politicians of all colours flocked to his side.
42:16Trust me, in all those years that I watched Rupert Murdoch,
42:21politicians crawled over broken glass to see him.
42:24Governments were always frightened of him because, with all those newspapers,
42:30he can make a hell of a difference, and still does.
42:34He could be a pretty dangerous opponent.
42:36And whether you were a Hawke, or a Keating, or indeed a Fraser, or a Howard,
42:42you took no to him. You didn't want to dismiss him.
42:45See you tomorrow.
42:47In Australia, Murdoch dominates the newspaper market with over 70% of the press.
42:54But it's his national flagship, the Australian, that arguably wields the most influence in the corridors of power in Canberra.
43:03The Australian is unashamedly right-wing.
43:05And that's primary role, perhaps more than any other, is to exert power, get close to power, use power, demonstrate his power.
43:17Rupert Murdoch, not only does he want to be close to it, he wants to be in bed with it.
43:21He wants to have the doona up to the chin, he wants to have the blanket on three.
43:27I mean, he wants to get as close to power as he can.
43:31Every Prime Minister up to Rudd wanted to be on friendly terms with him.
43:36And people did fear him, because he could be pretty frightening.
43:40In 2007, Murdoch gave his backing to a new generation of leaders in Downing Street and The Lodge.
43:48Today, Australia has looked to the future.
43:53Like his predecessors, Bob Hawke and Paul Keating, the new Labour Prime Minister, Kevin Rudd, was given Murdoch's blessing.
44:02Rudd would often drop into Murdoch's newsrooms.
44:06While in Britain, Murdoch became close to Tony Blair's successor, Gordon Brown.
44:11Murdoch, the power broker, was on a roll.
44:17But his dynasty wasn't.
44:20Only his youngest son, James, remained by Murdoch's side.
44:26He was running B Sky B, and in 2009, he assumed responsibility for the British newspaper empire, News International.
44:35The editor of The Sun tabloid, Rebecca Brooks, was promoted to help James run the newspapers.
44:43She was Rupert Murdoch's protégé.
44:46I always felt she was sort of the daughter he'd never had in that sense.
44:50I mean, they were obviously very close indeed.
44:53They'd get on wonderfully well.
44:55Whenever you saw them in public, they were smiling and laughing.
44:58Great. Father and daughter.
45:00I mean, she's a brilliant conduit for him.
45:04But a time bomb was ticking under Murdoch's empire.
45:08Ironically, it was sparked by the suspicions of favourite royal tabloid target, Prince William,
45:15after he noticed his phone messages had been tampered with.
45:19In 2007, an investigation into a phone hacking scandal at Murdoch's British tabloid, The News of the World,
45:27led to the jailing of a royal reporter and a private investigator.
45:30Further newspaper reports would claim that the same paper had hacked the phones of thousands of celebrities, politicians and public figures.
45:41British politicians barely raised an eyebrow.
45:43The new Conservative leader, David Cameron, was keen to win over Murdoch.
45:50David Cameron, you know, took the baton onwards and became unbelievably friendly with all the Murdochs and Rebecca Brooks.
45:58And they all hung around this village called amusingly Chipping Norton, which sounds like a sort of venue for an Agatha Christie plot.
46:09And they went riding on horses together, him and Rebecca Brooks.
46:13And then it got to the point where you felt it won't do.
46:21Rebecca Brooks and James Murdoch lobbied his father to withdraw his support for Gordon Brown.
46:27Rupert fought against the tide of dumping Brown for some time. David Cameron, he did not find charismatic at all.
46:38I remember sitting at dinner and it was being put to Rupert by Rebecca, by James Murdoch, Rupert's son, that this was the new Blair.
46:48She was trying to get them into bed together. And Rupert was very much the reluctant suitor.
46:59Nonetheless, Murdoch reluctantly pulled the plug on Gordon Brown.
47:04And the son endorsed David Cameron in September 2009.
47:11Seven months later, Cameron entered Downing Street.
47:14Murdoch was one of his first visitors via the back door at Number 10's request.
47:22Rupert, bless him, changes his politics when he fancies, you know.
47:27He will tell you how the Prime Minister's consulted with him and all that stuff.
47:31And that's how he likes to feel.
47:33Yeah. The reality is, is they were shit scared of him, shit scared of his newspapers.
47:38I've got to like him more and fear him less now that I don't, you know, I've got no, you know, there's nothing he can do to put me in power or not put me in power or whatever.
47:49Six weeks after Cameron's election, in Canberra, Kevin Rudd was deposed by Julia Gillard after his popularity collapsed.
47:58I accept that the government has lost track. We will get back on track. I have taken control for precisely that purpose.
48:10After a spate of negative headlines, Rudd had complained that Murdoch's newspapers were running a vendetta against his government.
48:17We've lived through an extended period over the last five years of a cycle of government of glass jaw.
48:25People have been incapable of receiving and responding to criticism in what I regard as being an absolute political obligation in responsibility to the community.
48:37On her first visit to New York as Prime Minister, Gillard beat the well-trodden path to Murdoch's door.
48:44Back in Britain, Cameron's government appeared to be on the verge of approving a bid by Murdoch to take over all of BSkyB.
48:55It was a deal that would have given him unprecedented power in the British media.
49:00But a murdered 13-year-old girl called Millie Dowler changed everything.
49:06The lawyer for the parents of the murdered schoolgirl Millie Dowler says her mobile phone was hacked by the News of the World
49:13during the investigation into her disappearance.
49:16I think Millie Dowler was a revelation.
49:20The public had been told this was the rogue reporter.
49:24This was just celebrities, sports people, politicians.
49:28And actually this is much wider.
49:30They're ordinary people, people who've had the most atrocious experience.
49:33No parent wants to lose a child.
49:37For the first time, Murdoch found himself on the receiving end of a media frenzy.
49:44Murdoch flew to London to try and take control of the crisis.
49:54He shut down the tabloid that had established him in Britain 42 years earlier.
50:03This is the final edition of Tomorrow's News of the World.
50:06He abandoned his bid to buy the rest of BSkyB.
50:09His son James was forced to step down from his positions at BSkyB and News International,
50:17throwing Murdoch's succession plans into disarray.
50:20Rebecca Brooks resigned.
50:23Rebecca Brooks has been arrested over the phone hacking scandal.
50:25And is awaiting trial on charges related to phone hacking.
50:29She denies the charges.
50:32So far, over 100 people have been arrested in connection with the phone hacking scandal.
50:38David Cameron set up a public inquiry led by Judge Leveson into press standards and ethics.
50:45The relationship hasn't been right because it has been too close.
50:50A contrite Murdoch gave evidence before a committee of British MPs.
50:55I would just like to say one sentence.
50:57This is the most humble day of my life.
51:00But questions were being asked.
51:03Just how widespread was the illegal phone tapping?
51:06And how far up the chain of command did it go?
51:08Rupert is the company.
51:11And the company is Rupert.
51:13I mean, he might have tens of thousands of employees, but he's created that company in his own image.
51:20It shares his moral code, his determination to succeed, his whatever it takes notions of success.
51:28It's going to affect how people view him forever.
51:31Rupert encouraged a certain culture in the UK.
51:37He certainly didn't encourage the behaviour that's gone on.
51:40But a general dose of naughtiness was encouraged and rewarded at the papers.
51:46I don't for a minute believe that he knew what was going on.
51:50And I don't believe for a minute that James knew what was going on.
51:53But still, that doesn't excuse the end result.
51:56I think we will have a long debate about media ethics in this country.
52:02But if I could put it as clearly as I can, I'd say to you, don't write crap.
52:07Julia Gillard followed David Cameron's lead and set up an inquiry into the media headed by Justice Finkelstein.
52:15I do believe Australians, watching all of that happening overseas with News Corp, are looking at News Limited here and are, you know, wanting to see News Limited answer some hard questions.
52:28When asked the logical question, what questions, there was no response.
52:34There was a whole lot of gobbledygook.
52:35It was clearly an inquiry that was launched very directly at News and I think most of the motivation was a concern on the part of the government that it was incapable to respond to criticism in any orderly, considered, coherent and persuasive fashion.
52:53The government's relationship with Murdoch's newspapers plummeted to a new low, as did Julia Gillard's poll ratings.
53:04Weeks earlier, Murdoch had summoned his Australian editors to a conference.
53:09He reportedly told his editors that he thought it was time that Tony Abbott had a chance at running Australia.
53:16And sure enough, in the weeks and months that followed, the reporting on the Gillard government became more aggressive, some would say much more negative.
53:27Liberal leader Tony Abbott, a former feature writer on The Australian, now had Murdoch's ear.
53:34Rupert has a high regard for Tony Abbott and he has a developed view that Tony has considerable leadership skills.
53:42I think many in the community share that view.
53:46Murdoch received some respite from his troubles when a review of his Australian newspapers found no evidence of phone hacking or bribery.
53:55The hacking of the mobile phone of a murdered teenager.
54:00Then, in November 2012, Judge Levison published his findings and found no evidence that Murdoch himself had any knowledge of the scale of phone hacking at the News of the World.
54:12The right to a free press is vital for democracy.
54:18But media organisations also have obligations to the Australian public.
54:22In March, Communications Minister Stephen Conroy's attempts to rush through new media legislation were abandoned at the 11th hour.
54:31In Australia, Rupert Murdoch controls so much that why would you take him on?
54:38He's too big to tackle.
54:40It's a scary proposition.
54:42You'd make an enemy for life and for any politician that spells political doom.
54:45You can't put that genie back in the bottle.
54:49Rupert Murdoch has become too powerful, not only in Australia, but across the world.
54:56Murdoch is splitting his empire into two.
55:00Separating the publishing division, including his newspapers, from the global entertainment arm.
55:05He hopes it will draw a line under the phone hacking affair.
55:11Nobody defends phone hacking.
55:13Let's make that absolutely clear.
55:16Absolutely.
55:17But he has been the most successful Australian on the world business scene ever.
55:22Now, a lot of people who don't like him won't like that being said, but it's true.
55:27Rupert works for a hobby.
55:31We must have a press free from government intervention.
55:35His passion for the media and his drive to continue investing and inventing in the media is probably without parallel in the modern world.
55:48Thank you very much.
55:51He's a bit of a shark.
55:52He's got to keep moving.
55:54That's his life.
55:56That's how he survives.
55:59Rupert Murdoch once said his life has been a series of interlocking wars,
56:04and the outsider boy publisher has spent a lifetime on the battlefield.
56:10Now in his 80s, he continues to relish his battles and looks set to fight another day.
56:22www.kestlieke.co.uk
56:29www.kestlieke.com
56:32www.kestlieke.com
56:47www.kestlieke.com
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