Jun 21, 2012

Can the independent KGB survive the News Corp gulag?

Will the Business Spectator doyens of business journalism, who deliberately named their business Australian Independent Business Media, now pull their punches on News Corp's appalling corporate governance?

Stephen Mayne — Journalist and Founder

Stephen Mayne

Journalist and Founder

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.

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20 thoughts on “Can the independent KGB survive the News Corp gulag?

  1. Modus Ponens

    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

    @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

    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

    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

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

  6. Frank Campbell

    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

    “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

    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

    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

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

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