News Corp Under Fire, Again

As if Rupert Murdoch's News Corporation wasn't taking enough heat for its phone hacking scandals, now all Britain is a buzz that the megamedia corporation  also brought down a rival satellite TV operator by dirty pool tactics. 

 Reported last night on the BBC program "Panorama," the News Corp-owned software security company NDS allegedly cracked and then spread the smart card security codes of a satellite TV company called ONdigital which was a rival to the News Corp-co-owned BSkyB  (short for British Sky Broadcasting.) 

  Sources of their information are the  German hacker Oliver Koermmerling, who says he cracked the code for NDS, and  Lee Gibling, operator of the pirate website The House of Ill Compute (THOIC), who says an NDS operative paid him  to distribute the security codes on line  so other hackers could make and sell counterfeit smartcards  to pirate ONdigital's signal.

 ONdigital, owned by the ITV broadcasting companies Granada and Carlton, eventually went under from this duress in 2002, leaving the lucrative pay TV business to BSkyB to rule alone.

According to the British paper The Guardian (which also broke the News Corp's phone hacking scandal last summer), News Corp attorneys attempted to derail the BBC report this past weekend by sending 'round denials and legal threats to other media companies. Then in a post-revelation response, NDS admitted that Gibling was on its payroll and that it had the ONdigital security codes. But NDS now claims their intent was for THOIC to "trap and catch hackers and pirates."

During the period when News Corp also owned DirecTV in the U.S., NDS took over the security side of the operation. Both DirecTV and  satellite rival DISH Network suffered then from rampant  smartcard hacking. The boldest of  pirates were subsequently found out, imprisoned and charged huge fines.

According to the Guardian, ONdigital smart card developer Canal Plus sued NDS in a U.S. Court in 2002, alleging that NDS had hacked its codes. But "no evidence about a link to ONdigital emerged," says the paper, and the case was dropped following a Murdoch purchase of Canal Plus assets.

Why is all this coming out now? Because News Corp is attempting to take over controlling interest in BSkyB, and must pass a "fit and proper" test with the British government. Ironically,  Murdoch closed his  News of the World operation last summer, in an attempt to diffuse that other hacking scandal and save the BSkyB deal.

Will Fox News, the Wall Street Journal, New York Daily News or iPad digi-paper The Daily get on this case today? Unlikely. But "The Daily Show with Jon Stewart" - always game to point out News Corp. missteps - should have a ball with it tonight.