Murdoch Bid for Australia Press Agency Stirs Critics

Rupert Murdoch is facing a public outcry and regulatory scrutiny over his reported plans to buy control of Australia’s domestic news agency and tighten his grip on the nation’s main newsprint maker.

Murdoch’s News Corp. Ltd., which already is Australia’s biggest media company, reportedly is seeking to double its holdings in Australian Associated Press by purchasing a 40% stake now held by John Fairfax Ltd.

That also would increase News Corp.’s stake in Reuter, the British news service of which AAP owns 13%, and would raise Murdoch’s control on the 16-member Reuter board of directors to three seats from the present one seat.

AAP is not related to the Associated Press, the U.S.-based news cooperative service.

News Corp. also reportedly plans to buy Fairfax’s 40% interest in Australia’s biggest newsprint supplier, Australian Newsprint Mills Holdings Ltd., in which Murdoch already holds a 50% stake.

The Australian-born Murdoch, who became an American citizen in 1985, currently controls 58% of daily news circulation in Australian cities.

AAP management has made no public statement nor, according to employees, has it issued any internal memoranda on the reported proposal.

Murdoch also has not issued a statement, and News Corp. spokesmen in New York said company officials there were not available for comment Tuesday.

Bob McComas, chairman of the Trade Practices Commission, said a “very active” inquiry of the proposed acquisitions was under way. The agency attempts to prevent any company from dominating a particular market, much like the U.S. Federal Trade Commission.

Urges Government Action

Some Australian newspapers and a prominent politician on Tuesday inveighed against Murdoch’s proposed acquisitions.

“He has more power over public information than any non-elected person should possess,” the Age newspaper editorialized. “It is more than time that the government called a halt to the increasing concentration of information ownership.”

Ian Macphee, a prominent member of the opposition Liberal Party, issued a statement calling for government intervention to block the purported deal and suggested that Parliament at its sitting next week amend the Trade Practices Act “as a matter of urgency.”

“Just how long do we have to wait until Mr. Murdoch, an American citizen, controls virtually 100% of Australia’s press?” Macphee asked.

“No country in the world would tolerate such a high level of ownership by a national, let alone a foreigner,” he said.

AAP, founded in 1935, supplies news to Australian newspapers and radio and television stations. Initially set up to bring overseas news to Australia, it now provides domestic news as well and also has a wide photographic distribution network.

AAP employs about 120 journalists in Australia and has bureaus in every Australian state capital as well as offices in Fiji, Papua New Guinea, the Philippines and Britain.

Like Reuter, AAP has expanded into other areas, particularly financial services and information and as well as developing high-technology communications systems.

Major U.S. Holdings

Murdoch’s global media empire includes substantial holdings in Britain, the United States and Hong Kong.

News Corp.’s U.S. holdings include 20th Century Fox Film Corp., parent of the syndicated Fox television network; the New York Post, Boston Herald and San Antonio Express-News daily newspapers, New York magazine, the Star weekly, and Harper & Row Publishers Inc.

Its British newspaper properties include the Times of London, the Sunday Times, the tabloid Sun and News of the World.

News Corp. in September acquired a 14.9% stake in Pearson PLC, a major British media conglomerate that controls the Financial Times newspaper, the Economist magazine, the merchant bank Lazard Bros. and Royal Doultan porcelain. The purchase sparked objections on similar grounds as those in Australia, by critics worried that Murdoch was gaining too much control over the British media.