News Corp Subsidiary NDS Hacks Rival

One would imagine that the last thing News Corp NWSANWS needs right now is another scandal, especially a scandal that involves the word “hack”. But that is exactly what has happened. According to the BBC, the company's news show Panorama has uncovered the fact that a News Corp subsidiary used a computer hacker to sabotage Sky TV's biggest rival. The accusation is that NDS leaked information from On Digital which could be used by consumers to create bootleg smartcards. They would then have free access to subscription TV. On Digital, owned by regional British TV companies Carlton and Granada, ceased to exist in 2002 after being unsuccessfully rebranded as ITV Digital. Naturally, NDS has denied the claims but, let's face it, the parent company has prior. Would Murdoch use technology to gain any advantage he can by any means necessary? Most likely yes, and he would probably call that “being a strong businessman”. These latest hacking claims have come from Lee Gibling, who told the BBC that he was paid to publish stolen information on his website, The House of Ill-Compute. He states that his contact as NDS was Ray Adams, head of UK security for the firm. "It is simply not true that NDS used the Thoic website to sabotage the commercial interests of ONDigital/ITV digital or indeed any rival," NDS said in a statement. “As part of the fight against pay-TV piracy, all companies in the conditional access industry - and many law enforcement agencies - come to possess codes that could enable hackers to access services for free. It is wrong to claim NDS has ever been in possession of any codes for the purpose of promoting hacking or piracy." ITV Digital chief technical officer Simon Dore is in no doubt that NDS are behind the company's demise, stating that the codes on Gibling's Thoic site came from NDS. “hey delivered the actual software to be able to do this, with prior instructions that it should go to the widest possible community.” Despite NDS's connection to News Corp, there is no evidence that Rupert Murdoch knew anything about these new hacks. However, Tom Watson MP of the Culture, Media and Sport Select Committee has called for Ofcom to investigate. “Clearly allegations of TV hacking are far more serious than phone hacking," he said. "It seems inconceivable that they (Ofcom) would not want to look at these new allegations. Ofcom are now applying the fit and proper person test to Rupert and James Murdoch. It also seems inconceivable to me that if these allegations are true that Rupert Murdoch and James Murdoch will pass that test." The news is not hurting News Corp in the market at the rime of writing. On Wednesday, ValuEngine published a research report stating that ValuEngine has issued a STRONG BUY recommendation for NWSA. “Based on the information we have gathered and our resulting research, we feel that NEWS CORP INC has the probability to OUTPERFORM average market performance for the next year. The company exhibits ATTRACTIVE company size, momentum and volatility.” On March 21, Deutsche Bank said that Fox remains number one in the U.S., with an average 2.83 rating and is now down 11.3% (-7.7% ex sports, STD C3 down 10.1%) including tough comps against the Super Bowl, but also due to large declines at Idol.