Rupert Murdoch’s News Corp yesterday faced a fresh barrage of allegations over its conduct, with an Australian newspaper claiming it had a secret unit that promoted pirating of pay-TV rivals.
The Australian Financial Review said the company sabotaged its competitors by promoting high-tech piracy that damaged Austar and Optus at a time when News Corp was moving to take control of the Australian pay-TV industry.
The newspaper, which belongs to News rival Fairfax, said the evidence was unearthed during a four-year investigation, as it began releasing 14,000 e-mails concerning one of the group’s security subsidiaries.
It follows the BBC’s flagship current affairs show, Panorama, on Monday making similar charges against the company in Britain and it piles the pressure on News Corp, which is already under siege over a phone-hacking scandal.
Australian Communications Minister Stephen Conroy said the allegations needed to be referred to police, while Australian Treasurer Wayne Sawn said the story was “concerning.”
“These are serious allegations and any allegations of criminal activity should be referred to the Australian Federal Police for investigation,” Conroy’s spokeswoman said.
News Corp has consistently denied any role in fostering piracy in pay-television.
In a statement, its Australian arm, News Limited, said the report was “full of factual inaccuracies, flawed references, fanciful conclusions and baseless accusations.”
“News Limited and Foxtel have spent considerable resources fighting piracy in Australia. It is ironic and deeply frustrating that we should be drawn into a story concerning the facilitation of piracy,” it said.
The Australian Financial Review claimed a secret unit of former policemen and intelligence officers within News Corp, known as “Operational Security,” crippled the finances of competitors such as Austar and Optus.
They did so by cracking the codes of smart cards issued to customers of the services and then selling them on the black market, giving viewers free access and costing the broadcasters millions of dollars, it said.
Austar is currently the subject of a takeover bid by Foxtel, which is part-owned by News Corp. News Limited said the notion that it tried to undermine Austar so that Foxtel could bid for it “are so far-fetched as to be laughable.”
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