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Can the independent KGB survive the News Corp gulag?

When I sold Crikey to Eric Beecher and Di Gribble in 2005, one of the clauses in the sales agreement limited the ability of each party to publicly criticise the other.

Seven years later, another feisty independent web publishing house has been sold, but this time the buyer is Rupert Murdoch, a proprietor with an unprecedented record of requiring and receiving loyalty and favourable editorial treatment from his employees.

So what does this mean for Alan Kohler, Robert Gottliebsen and Stephen Bartholomeusz — the crack “KGB” team of commentators and inquisitors at Business Spectator —  who have all reportedly become instant millionaires courtesy of the generosity of News Corp’s $20 million-plus up-front cash payment for their business?

Will these doyens of business journalism, who deliberately named their business Australian Independent Business Media, now pull their punches on News Corp’s appalling corporate governance, nepotism, stacked board, Murdoch family gerrymander, abuses of corporate power and industrial-scale criminality in the UK?

The KBG will now be answerable to uber-Murdoch loyalist Chris Mitchell, who was quoted in The Australian today saying it was “great to have Alan and Gotty back at The Oz after so many years, and to welcome Steven to the paper. Being able to add them to the best columnist in the country, John Durie, has made my day.”

Alan Kohler is now the richest business journalist in Australia and in my view he and John Durie share top billing for quality, writing and insight. However, Durie has one substantial flaw: he covers corporate governance issues better than anyone but baulks at criticising News Corp. Sadly, this is the price you pay when you agree to take Rupert’s shilling.

Most News Ltd business commentators through the years — Durie, Matthew Stevens, Terry McCrann, Bryan Frith, Michael West and Mark Westfield — have voluntarily submitted themselves to the culture of blind loyalty. I did it during my five years as a News Ltd business editor on the tabloids in Sydney.

But in light of the unprecedented media ownership concentration in Australia and the enormous governance scandals that have engulfed News Corp over the past year, is this really an acceptable state of play in 2012? Will we even have a decent debate about the dominant newspaper group extending its dominance in pay TV as well, courtesy of the $2 billion Foxtel and Fox Sports bid?

News Ltd publications have recently been railing against any possible regulatory reforms arising from the Finkelstein report on the grounds that it infringes free speech. Truth be known, the greatest impingement on free speech in Australia is the cultural requirement that the dominant newspaper and pay-TV company in Australia does not brook any criticism from within.

Kohler was certainly out of the gates fast talking up News Ltd yesterday. No mention of the Melbourne Storm scandal when he spoke to ABC Radio’s PM program last night and said:

Yeah, very happy. And very happy with News Limited, they’re a fantastic organisation and they’ve been really great to deal with.”

There were similar sentiments in his page-one column for The Australian today.

Such a gushing endorsement wouldn’t have been forthcoming without a News Ltd sale and employment contract that will deliver gross proceeds of more than $7 million to the ABC’s public face of business journalism.

It is easy for business pundits to take a cynical view on these matters. Unlike the vast majority of business journalists, Kohler tried his hand as an entrepreneur, laboured extremely hard for seven years and pulled off a much-deserved pay day.

He partnered up with canny operators such as Eric Beecher, Mark Carnegie and John Wylie to exploit the poor performance of former AFR CEO Michael Gill and then extracted a lofty premium from News Ltd at a time when the Murdoch empire was really keen to stick it up Australia’s only financial daily after its huge pay-TV piracy coverage. But don’t expect to ever hear the KGB calling for News Corp to belatedly respond to the hard questions that remain unanswered from the global NDS piracy scandal.

It would be great to be proved wrong on these matters, but don’t hold your breath. From the perspective of the ABC, the national broadcaster must insist on protocols that do not limit potential criticisms of News Corp as long as Kohler continues to present Inside Business on ABC1 each Sunday morning. Any ABC viewer who objects to Kohler being a Murdoch man does have alternatives at 10am on Sunday   — they can always switch over to the Lachlan Murdoch-chaired Network Ten where Andrew Bolt will probably be slamming Julia Gillard and talking up his favourite billionaire, Gina Rinehart.

Bolt’s main piece in the Herald Sun today was a perfect case study of the ideology, indulgences and excesses of News Ltd. Placed next to a huge picture of the $29 billion woman, the column was headlined: “Gina is not the real threat to free media” and it concluded that government-funded media and regulation was a far bigger worry.

The failure of News Ltd publications to seriously challenge the appropriateness of Rinehart controlling Fairfax Media shows how the Murdoch empire puts ideology and market dominance ahead of any genuine beliefs about free speech, media diversity and professional journalistic impartiality.

Kohler wrote a great column on Business Spectator slamming Rinehart this week. It would be great to see his News Ltd colleagues supporting such a view over the turbulent weeks and months ahead.

20
  • 1
    Modus Ponens
    Posted Thursday, 21 June 2012 at 1:10 pm | Permalink

    Who would have thought that the owner of this fine publication would receive around $5.4m from Rupert and Limited News! (18% stake of $30m sale).

    I feel pretty uncomfortable about it, plus not getting the business spectator extracts in these pages.

  • 2
    michael r james
    Posted Thursday, 21 June 2012 at 1:42 pm | Permalink

    @MODUS PONENS at 1:10 pm

    Dear Modus, I advise looking at it as a glass half full. Do we Crikey readers really believe that KGB’s contributions (to Crikey or BS) are that special? There has been a perception, IMO mostly accurate, that K stretches himself too thin and that the others write with an ideological bent not a million miles from what Rupert would approve of (does anyone imagine K hasn’t kept his peripheral vision on this from the beginning?) It is somewhat breathtaking that he can manage it all, but his pieces often show the strain in superficiality, mostly caused (if we are to be generous) by time pressure.

    Good business writers may be difficult to find (I suspect because they value {“monetize”} their own contributions more than most, whether justified or not) but this is an opportunity for Crikey to find better replacements. And for the record, I find Stephen Mayne’s contributions on business matters consistently much more worth reading than KGB’s.

    One should also be wary of concluding that Rupert is snapping up KGB because of their wonderful writing skills and reader appeal, instead of the obvious preventative action of stopping them going anywhere else, especially in the online area where KGB have succeeded (though in the wider perspective, quite modestly really even if it makes them millionaires).

  • 3
    michaelwholohan1
    Posted Thursday, 21 June 2012 at 1:53 pm | Permalink

    Take the money & run?…………Well that seems the way of things, BUT Mr. Kohler should remember Frank Zappa’s pronoucement “there is a big difference between kneeling down & bending over” ……………so what will it be crusader or courtier?

  • 4
    michael r james
    Posted Thursday, 21 June 2012 at 1:54 pm | Permalink

    I would add to my earlier post that in the matter of Kohler’s appearances on ABC, I think it is time for them to move on and find some fresh blood. Just like it was unacceptable to have Andrew Blot spew his partisan poison on ABC discussion shows, it will not be acceptable for a News Ltd employee and multimillionaire to be commenting on the people’s media on matters for which it is now (if it hasn’t been for a long time) incontestable that he is a “player” and a partisan (even if unconscious).

    Indeed when you think about it, because of the sustained profile given to K over the years, I believe he should tithe a fraction of his $8M payday back to the ABC. Come on Alan, it will be tax deductible and you know you owe Auntie.

    It is a nonsense to imagine there are no others who can do this stuff. In fact how about Stephen Long who speaks so much sense on the few minutes he gets each week (mostly on The Business but occasionally 7.30).

  • 5
    Pete from Sydney
    Posted Thursday, 21 June 2012 at 2:18 pm | Permalink

    Michael R James, surely Alan is already paying the ABC through his taxes?
    It is paid content after all

  • 6
    Frank Campbell
    Posted Thursday, 21 June 2012 at 2:20 pm | Permalink

    The Kohler conflicts of interest were always uncomfortable

    But the KGB joining the Murdoch mafia- really sick.

    At least we’ve still got Stephen Long.

  • 7
    Mike Smith
    Posted Thursday, 21 June 2012 at 3:03 pm | Permalink

    Its good to be the king” - Louis XVI and to be able to buy the silence of those that might otherwise commit lese majeste and criticise Him.

  • 8
    michael r james
    Posted Thursday, 21 June 2012 at 3:06 pm | Permalink

    Frank, I cannot tell if you are being sardonic with your Stephen Long comment. If you agree with me then please use your great letter writing talents/energy to send a missive to the ABC about it!

    I should add to my earlier musings about Crikey replacing KGB’s occasional pieces of wisdom: of course I know it was a cost-free mutually beneficial deal. But Crikey/Eric Beecher needs sometimes to put up some actual dosh for good journalism. Indeed with the KGB deal one could observe that you gets whats you pays for.

  • 9
    Seasprite
    Posted Thursday, 21 June 2012 at 5:24 pm | Permalink

    The Bolt writes in his article: “But government already has too much power over opinion forming, especially as the big private media outfits crumble.

    It already funds two television networks, a radio network, a 24-hour TV news channel, a 24-hour radio news station, a massive news website, an opinion website, an overseas TV network and blogs.”

    James and Rupert Murdoch have said government funded media are a threat to their interests and Tony Abbott looks set to be elected PM on current polling, when can we have some journalists asking some hard questions on what plans he has for the ABC, SBS and Government funded organizations.

  • 10
    GarryB
    Posted Thursday, 21 June 2012 at 5:37 pm | Permalink

    If Peter Reith can get regular, almost ad nauseam, certainly nauseating, appearances on the ABC Kohler is hardly a threat!

  • 11
    Pedantic, Balwyn
    Posted Thursday, 21 June 2012 at 6:24 pm | Permalink

    I share the concern about KGB joining the dark side, and its impact on any future financial reporting on the ABC. However, as ABC News already widely quotes News Ltd without further analysis or research or any attempt at balance I wonder what really changes?

    The ABC News Room’s slovenlyness is incremented by Chris Ulhmann’s determination to destroy reasonable debate on the 7.30 Report; except when Opposition members are given the velvet glove treatment.

    Any hope of credible reporting is left to Barrie Cassidy on Insiders, and even he tolerates Piers Ackerman boorishness. I suppose it is in the interests of balance; no doubt they would give a dictator like Mugabe equal time to spew out his intolerance in the same context.

  • 12
    AR
    Posted Thursday, 21 June 2012 at 8:15 pm | Permalink

    I think that we can kiss K(whispering G long ago and B - no idea) good bye. Apart from K’s often diverting graphs on ABC 7pm TV news, I’ve never heard him ask a pertinent, never mind tough, question of a BigBiz fatcat or flack on his risible Sunday morning prog.
    It behoves ABC to shed him entirely, for the reasons Mayne listed above.
    When (never were) poachers become forelock tugging gamekeepers, it is time to start divesting. Trouble is, where to go?

  • 13
    Frank Campbell
    Posted Thursday, 21 June 2012 at 8:19 pm | Permalink

    M.R.James:

    I always had the feeling Kohler would be the actress to Bernard Shaw’s Murdoch:

    Murdoch: “will you sleep with me for a million pounds?”
    Kohler: “Very likely”
    Murdoch: “how about a pound then?”
    Kohler: “Dammit Sir, what sort of economist do you take me for!?”
    Murdoch: “I know what kind. We’re just haggling over the price.”

    (allow a factor of 8 for inflation)

    We don’t see enough of Stephen Long. When he pops up on ABC’s “Business” at 11pm, we pay attention. Sharper attention than we give to Kohler, alluring though he is…

    The ABC should now reduce its intake of Kohler and hire others…as you say, there are quite a few to choose from.

  • 14
    michael r james
    Posted Thursday, 21 June 2012 at 9:08 pm | Permalink

    Frank at 8.19 pm

    Good.

    Actually Stephen Long has done a few longer pieces to camera this year (investigative pieces, possibly for Lateline?) so perhaps management are in fact testing him. I assume he is the researcher behind many of the economics stories on Lateline and Lateline Business (The Business).

    Although that recent thing on the Drum that created some son et lumiere was not a good idea, ie. I agree with Gawenda that ABC journalists/reporters should not be giving opinions. His interrogation-type session with Ticky Fullerton on The Business (errm, is it Lateline on Friday nights in a weekly wrap?) is a little close to the wind but actually he handles it extremely well IMO.

    Incidentally Ticky F. has a PhD in economics from Oxford and worked for CS First Boston for a decade, so she is eminently qualified as well as extremely good at her job. Sometimes I think she is underutilized, in that The Business is a bit formulaic and by-the-numbers a lot of the time. She is excellent as a investigative journalist as revealed in the story, then book (Watershed, 2001) on the farce that is Australian water politics.

  • 15
    Frank Campbell
    Posted Friday, 22 June 2012 at 10:19 am | Permalink

    MRJ: No doubt Ticky is sharp- perhaps hamstrung by being the presenter. Didn’t know about “Watershed”. Will check it out.
    The inevitable endemic problem with “business” journalism is that journos either uncritically share fundamental capitalist assumptions or are too timid to seriously question corporates. Take the fat banksters Kohler and Fullerton interview for instance- I’ve never seen any of them put under real pressure.

    Bigger picture is unhealthy: two camps- the Murdoch stable of nobbled horses, and the ABC/Fairfax/Crikey set of incestuous regulars, the Fitzglebes. Unlike Jennifer “Giggles” Byrne (to take but one egregious example) we need to distinguish between Murdoch’s Op-ed/editorial mavens and the mass of News Ltd journos. The latter are the majority of Oz journos! Many of them do what they can to ameliorate symptoms of Murdoch bias. One example was the late lamented Jim Hall, who briefly edited the Oz before being defenstrated by Rupert for culpable independence (aka leftist deviation)…Luckily Jim bounced off an awning and landed in Book Reviews.

    Journalists interviewing each other: epidemic. Dysfunctional. They then morph into pundits. Being generalists, they are easily bluffed about many issues (eg none are either energy or climate-literate).

    Speaking of cringe- the Fitzglebe clique all ended up on the ABC’s teeth and tonsils “Randling”…

    The political class is really a single, writhing organism, constantly biting and copulating with itself. These politicians (mostly ex-lawyers) and commentariat share one outstanding feature: they are intensely social. Most are computer illiterate (Abbott, Gillard). Virtually all are generalists. Classic example is Annabel Crabb. She made a mockery of keeping distance from politicians in her recent cringe-inducing TV series “Kitchen Cabinet”.

    Needless to say, this class is inner urban.

    Naturally, the agendas and priorities which emerge from it often bear little relation to the various realities beyond the lowest postcodes…

  • 16
    Frank Campbell
    Posted Friday, 22 June 2012 at 3:16 pm | Permalink

    Speaking of the political class being a single organism- I read today that Anna Rose and Simon Sheik (boss of Getup) recently married.

    Rose is a classic example of the uninformed generalist-lawyer launched on a career of pure propaganda (climate in her case). Carbon Yeti Anna won the Most Frequent Flyer award this year…

  • 17
    Paul Odgers
    Posted Friday, 22 June 2012 at 4:38 pm | Permalink

    I was at the Eureka conference yesterday and washed my hands with the protagonist - Mr Kohler and said - “I guess this means that Rupert hasn’t taken to heart all your comments in the past?” It took me a while to realise the irony of my comment in view of the possible outcome for Eureka and Alan’s liklihood to continue making those comments.
    Gottliebsen at the end of the day said that there were conditions in the contract that preserve their independence…But I am genuinely worried about the independence of media in Oz, with Gina’s foray…which is why today I have subscribed to Crikey for the first time.

  • 18
    Mike Smith
    Posted Friday, 22 June 2012 at 6:01 pm | Permalink

    Kudos to Frank Campbell for that piece of salacious gossip.

  • 19
    Frank Campbell
    Posted Saturday, 23 June 2012 at 10:07 am | Permalink

    Mike Smith: kudos not to me but to yesterday’s “Age”. Lawrence Money’s interview with the inane Anna Rose…

  • 20
    Frank Campbell
    Posted Saturday, 23 June 2012 at 10:10 am | Permalink

    Paul Odgers:
    “Gottliebsen at the end of the day said that there were conditions in the contract that preserve their independence”

    Rupert has a long history of trashing such agreements. KGB are well aware of this. What matters to them is the money.

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