Is News International Just Rearranging Deck Chairs on the Titanic?

Review comes as company deals with hacking scandal

Like newspaper companies the world over, Rupert Murdoch’s News International is in financial free fall, reporting a loss of almost $130 million last year. Most publishers, however, are not saddled with the kind of legal woes that News International is currently facing.

Last week, Scotland Yard confirmed plans for a possible investigation that would dig deeper into comments made by Rebekah Brooks, News International’s chief executive. In March 2003, when Brooks testified before a Parliamentary committee, she said that The Sun newspaper, where she was then editor, had paid police officers for information. Earlier this month, the chairman of the Home Affairs Committee wrote Brooks asking for further details on these payments. Brooks responded that it had not been her intention to give the impression that she had “knowledge of any specific cases.”

Asked about the impending investigation, News International spokeswoman Daisy Dunlop told Adweek that there would be no comment from the company at this time.

This recent inquiry into Brooks’ comments is part of the ongoing phone tapping scandal that has embroiled News International since 2007. In early April, News of the World—a tabloid under the News International umbrella—saw three more of its journalists arrested for illegally hacking into the phones of politicians and celebrities. With the potential to uncover dozens of additional victims who may sue the tabloid, a judge in London plans to move forward with four cases to access damages for future suits. So far, News International has paid out the equivalent of roughly $1.65 million to cover up hacking cases.

Despite a possible police probe, Brooks appears to be maintaining a business-as-usual attitude, or at least she's trying to project that image.  This week, Brooks launched a three-year internal review for each department of News International. Under the banner “changing the game,” Brooks plans to scrutinize the print-based company and determine how better to invest in digital and TV to more aggressively compete for advertising as circulation continues to decline.