The hacking scandal that shuttered British tabloid News of the World deepened Monday amid reports that the paper’s journalists sought to break into the phones of 9/11 victims by trying to enlist the aid of a former New York City cop.
Rupert Murdoch, 80, the CEO of News Corp., is hunkered down in England trying to quell the scandal, but two fires pop up for every one he puts out. His firm’s shares plunged more than 7 percent.
The crisis has led to increasing speculation about how the scandal could reverberate across the pond at his properties here, which include the Wall Street Journal and the New York Post.
Jeff Jarvis, media critic and blogger at buzzmachine.com, said News Corp.'s American properties are indeed tainted by the scandal.
"It tends to be a very decentralized company ... but yes, association with News Corp. is going to be a liability," he said. "I don’t know that there's much [his American papers] can do."
Ava Seave, who teaches at Columbia University’s business and journalism schools, agreed, adding that the scandals will likely put pressure on the American side of the business.
"News of the World was very profitable," she said. "With less profit around, there might be some cuts in [News Corp.] companies that” make less money, she said.
The scandal has also forced News Corp. to postpone its purchase of British TV operator BSkyB to 2012 and send it to government review.
News Corp. didn't return a call for comment.
On this side of the Atlantic, a group of shareholders reportedly filed a lawsuit against News Corp. over its handling of the scandal.
Journalists at the shuttered paper reportedly asked an ex-NYPD officer turned private investigator to hack into the voicemails of 9/11 victims and to obtain calls logs.
He refused, saying he knew "how insensitive such research would be, and how bad it would look,' the British Daily Mirror reported.