Get a load of this! Murdoch empire continues its slow, painful demise

I’ve never been one to believe the circulation figures of most publishers, specifically newspapers.  There are just too many ways that I’ve seen to manipulate the numbers in publisher’s favor.  And the circulation bureau audits are a lot like the financial industry ratings agencies in that they are financially dependent on the industry they are supposedly judging impartially.  But this story on the scam run by the Wall Street Journal’s European edition is a new low, even to my cynical sensibilities.

Here’s the latest in the recent unending, sad saga of Rupert Murdoch’s newspaper empire.  Read it and weep. 

So the Wall Street Journal’s European edition cut deals with various organizations to exchange positive editorial coverage for them buying bulk copies of the paper for as little as a penny a copy to distribute freely at seminars and such.  The Audit Bureau of Circulation ruled that this practice was somehow legitimate and these copies would be counted as paid circulation. 

There are several problems here.  The first and most obvious is the quid pro quo for positive editorial coverage.  This is the Wall Street Journal, for god’s sake, giving away biased editorial coverage openly in exchange for favors.  The second is the circulation audit bureau legitimizing the scheme by declaring that copies at a penny a piece handed out freely as swag at seminars counts as paid circulation.  Even that, as obviously crooked as it is, wouldn’t be so bad if it was a modest number of copies.  But it accounted for over 40% of their daily circulation for over a year, or somewhere in the neighborhood of 30,000 copies per day!  That’s a helluva lot of seminars, don’t you think.  The first question that popped into my head was, “were all these copies actually printed?”  Given the sheer numbers involved here, I wouldn’t be surprised if most of them never existed in the first place.

The whole point of this exercise was to boost the circulation figures of the Journal’s European edition to prop up ad rates.  How, in the name of all things good and holy, does this not constitute massive-scale fraud on advertisers?  Not to mention fraud on readers who now get slanted positive coverage of the groups that helped the journal perpetuate this scam on advertisers.  And what does this say for the audit bureau’s credibility that they legitimized this rip off?  But wait, it actually gets worse!

A company “buying” some of these copies decided last year that they weren’t happy with the editorial coverage they were getting, so they pulled out of the deal.  The Journal then promised even more slanted coverage to this group.  And, get this, they started funneling money through other third party companies, paid to the squeaky wheel, who then used that money to pay for these discounted Journal copies.  They were basically buying large numbers of their own newspaper at barely above free prices to prop up circulation!  Can I say it again?  This is the Grand Old Lady, it’s the Wall Street Journal, the most famous newspaper on the planet doing this!

There’s also the little matter of someone inside the company who ratted out this scam to the Journal’s parent company, Dow Jones, last November.  This person was ordered to shut up about it in December, essentially fired in January and now is painted by the company as the scapegoat for the whole fraudulent, unseemly affair.  Seriously, read the article.  If it doesn’t turn your stomach, you’re far more cynical than me, and I thought I’d heard it all.

And here’s the Wall Street Journal’s somewhat half-hearted response to the allegations.  In it, they deny any wrong doing, point the finger at the whistleblower if there was any wrongdoing, firmly asserting that the scam was above board, but also that they’re ending it because it appears to be cockeyed.  Nothing like covering all your bases.  We didn’t do anything wrong, even if it really looks like we did, and if we did, it wasn’t us, it was the guy over here who we fired in January, and we only kept things going until someone else found out about it and it looked bad.  But it’s okay now because we’ve stopped it.  It’s all good.  You can trust us, we’re the Wall Street Journal!

The only question I have at this point is when can we expect the Murdoch retirement party?

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