Stan Grant and Tracey Holmes are the relatively innocent victims in a broader fight between Kerry Stokes and News Corp. The tabloid dogs are never set loose without the blessing of those at News Corp counting the dollars.

Last week we published Graham Davis’s take on the Stan Grant and Tracey Holmes saga on Crikey and published our own views in a sealed section that went to subscribers only. However, the issue is still bubbling away nicely so it’s time to bring all of this out into the wider public domain.

Firstly, you have to assess this story from the perspective of the broader corporate sub-text. Stan Grant and Tracey Holmes were merely pawns in a far bigger game. For the Daily Telegraph to chase this story so hard, it clearly means that News Ltd is not happy with Kerry Stokes and the Seven Network at a corporate level for some reason.

Murdochs pull story on Packer separation

The Murdoch editors will defend their actions on the basis of it being “a bloody good yarn”, as Telegraph editor Steve Howard so eloquently told Mark Day last week for his cover story in the Media section of The Australian. But how do they defend the stories they have not run? I can remember being in the Telegraph newsroom that October night in 1998 when the Murdochs pulled the story on James Packer and Kate Fischer separating. It was the same day as the News Corp AGM in Adelaide and the Murdochs got their message around to all of the editors that the story was not to be run. Clearly they were trying to keep sweet with the Packers at the time as part of some broader corporate agenda.

None of the editors stood up to the Murdoch’s for this and it was clearly a great story that deserved to be on the front page, especially in Sydney. Daily Telegraph editor Col Allan dutifully went on radio and claimed it wasn’t a fresh story because New Idea had reported it that day. So why would they chase the Stan and Tracey story so hard for two weeks if James Packer and Kate Fischer didn’t even rate a mention? The answer has to be some form of bigger fight.

Cowley Departure Sows Seeds of Bigger Fight

The retirement of Ken Cowley as News Ltd chairman and chief executive in 1998 is pivotal in understanding this issue. His departure meant that the close personal friendship he shared with Kerry Stokes also left the News Ltd head office. Remember that the two of them are the largest shareholders in RM Williams. In the old days, one call from Stokes to Cowley could have nipped this whole thing in the bud. However, Lachlan Murdoch wanted to make his own name in Australia and therefore cut Cowley off. The two of them shared responsibility for the Super League fiasco which was presumably a source of great tension.

Since Cowley’s departure, relations have progressively soured but they reached a new low just before the Telegraph unleashed its campaign against Stan and Tracey. Things first got ugly when News Ltd sold its 15 per cent stake in Seven in 1998, a clear vote of no confidence in Seven’s leadership team. However, the company was putting on a brave face at this time. As Daily Telegraph business editor I wrote that story pretty hard with phrases like “dumped” and “vote of no confidence”. News Ltd group editorial director John Hartigan sauntered over to the backbench as is his want close to deadline and directed that it be toned down and the story run straight. A check of the library would show the story to be very neutrally presented – a complete contrast to the emotive “Holmes Wrecker” headlines of the past month. People like Harto and Col Allan spend a lot of their time deciding how stories about the opposition are to be run.

So, why did News sell out?

My take on why News sold out of Seven is twofold: Rupert knew how badly MGM was going in Hollywood and he wanted a clear run at the digital sprectrum debate without being in bed with one of the free to air networks. Stokes was obviously pissed off that News had sold out and Hartigan told me that night of the sale that Seven was “appallingly managed”. The decision to sell has cost News more than $100 million in missed profits because the Seven share price has taken off since the sale. News wasn’t to know that Stokes would pull off a Houdini-like exit from Seven’s stake in MGM or that he and Packer would seduce the Libs and win the digital argument hands down.

Stokes sides with Packer over digital

Relations deteriorated further last year when News was desperate to get some of the digital spectrum that was handed out for free by the Howard government. Little Kerry lobbied hard behind the scenes to Richard Alston and others that Murdoch be denied. News Ltd was mightily pissed off about this but Stokes had increased his stake in Seven to more than 30 per cent by now and fell into line with Big Kerry and the Nine network. Consider the contrast with when Stokes bought into Seven in 1995. He argued long and hard that the board should not be locking Seven into a pay-TV deal with Optus and the Packers, but rather they should be looking at Foxtel. Everyone presumed that Stokes was Murdoch’s mate – afterall, when Stokes bought the Canberra Times off News, Cowley dutifully provided the services of long time Murdoch editor David Armstrong, now editor-in-chief of The Australian, to edit the boring Canberra monopoly broadsheet for three years.

Falling out over Foxtel

How things have changed since Little Kerry argued so hard to back Foxtel when Seven turned around this year and successfully sued Foxtel for access to its cable network. This is how Financial Review legend Ivor Ries described its court victory two weeks ago.

“Seven Network supremo Kerry Stokes now has the Foxtel trio – Ziggy Switkowski, Rupert Murdoch and Kerry Packer – just where he wants them. On toast.”

Little Kerry Rubs Salt Into Rupert’s Super League Wounds

If that wasn’t enough to piss News Ltd off, you then have Little Kerry committing $3 million three weeks back to help save Super League victim South Sydney next year. This would have infuriated the Murdochs who have already dropped more than $500 million on Super League and just want the head-ache to go away by shutting down Souths once and for all. Stokes was encouraged by two Seven personalities who double as Souths supporters – Mike Whitney and Andrew Denton. Souths was one of those clubs that stuck with Packer during the Super League wars and has a number of Murdoch enemies as supporters – notably one Alan Jones. Interestingly, John Laws was paid by Super League to spruik its interest, as good old Media Watch revealed last year.

So, How Did The Stan and Tracey Debacle Start?

There was no directive issued to especially hunt out the Stan and Tracey story. However, when the Tele got wind of it, it whipped it up way beyond its normal tabloid style. Dubbing Tracey a “Holmes Wrecker” was outrageous, even by the Telegraph’s own low standards.

Mark Day’s piece in the Media Section fills in some of the gaps. Grant initially co-operated with the Telegraph’s Brooke Williamson and issued a statement on August 3 confirming the liaison with Holmes. It included the following: “There is pain for everyone involved. The main concern now is for the well-being of our children.”

It is at this point that Stokes would have rung Cowley and nipped the whole thing in the bud, just as the Packers headed off the Telegraph’s reporting of the split between James and Kate Fischer.

Why did the Tele pull the story on Jodie Packer’s dad?

Similarly, it was 8pm on the Friday night before the Packer wedding last October that the Telegraph pulled what would have been a fabulous front page story by Adam Harvey on the fact that Jodie’s dad was not invited to the wedding and his step-daughter was getting married on the same day in a very humble Rockhampton wedding. The story was to be the contrast between the two weddings but Lachlan flew back into Australia that morning and decided he was going to attend the wedding of the century – hence the Telegraph could not dump all over it on the front page.

Stan Mishandled The Whole Affair

There is no doubt that Stan Grant mishandled the affair but he was rightly outraged about the “Holmes Wrecker” label. Is it any wonder he snapped at a News Ltd photographer in Adelaide and abused The Australian’s chief of staff when she started snapping them together in a supermarket. Hypothetically, how would News Ltd group editorial director John Hartigan react if Today Tonight did a story labelling him a “Home Wrecker”.

News Ltd leave themselves wide open for counter attacks

The decision by Harto’s great mate Col Allan to play the Stan and Tracey story so hard puts Harto and others in a difficult position. What if Today Tonight turned around and started pursuing them over their private lives. Watching Media Watch last week, it was also interesting to see that the Herald Sun described Stan and Tracey as “disgraced”.

So what does that make Herald Sun editor Peter Blunden, who subscribers would remember has left his wife and kids for his secretary. If the Herald Sun can call it “The Grant Affair”, maybe Today Tonight should respond with a story called “The Blunden Affair”. It is absolutely no different and we look forward to hearing from any pious Herald Sun scribes trying to argue it is different.

Kerry Stokes revealed as a hypocrit

Graham Davis made the point about Kerry Stokes’ hypocrisy elegantly in Crikey last week and Mark Day put it in the following terms:

“Executive chairman Kerry Stokes was reported to be unimpressed by the goings-on between two of his stars, but reluctant to act. He was fully aware of the potential for claims of hypocrisy if he, thrice married and the sometime squire of his own female employees at public functions, were to tut-tut about the private affairs of others.”

Day went on to point out that Stan Grant was not happy in the job and Tracey Holmes was proving to be “difficult” and he concluded that both stars brought it on themselves. Stokes offered them different positions but for some reason they were too proud to accept. According to Day, Tracey would simply have been sharing the morning presenter’s role with one other rather than doing it solo and Stan would have been back on the road without a pay cut.

However, none of this would have happened without the Telegraph’s campaign – they would both probably still be with the network. And why did the Telegraph campaign so hard, especially against Holmes?

Mark Day touches on the South Sydney theory but failed to expand it to the broader corporate brawl. He then simply quoted Tele editor Steve Howard saying things like: “It kept feeding itself. Each day posed more questions. You don’t need any agenda with a story like that.”

And what about reporting the great story of Rupert and Wendi Deng Steve? And what about the story of Jodie Packer’s dad? And what about the break-up of James Packer and Kate Fischer? You can’t have it both ways old boy.

The lesson from all of this

Let’s face it, the Murdochs only let their tabloid dogs loose when it suits their commercial interest. Just ask John Howard after the digital decision last year, just ask Joan Kirner, just ask the British Labor Party and just ask Kerry Stokes, Stan Grant and Tracey Holmes at the moment.

Here ends the lesson.

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Peter Fray
Peter Fray
Editor-in-chief of Crikey
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