Pay TV piracy hits Murdoch

A secret unit within Rupert Murdoch's News Corporation promoted a wave of high-tech piracy in Australia that damaged Austar, Optus and Foxtel at a time when News was moving to take control of the Australian pay TV industry, a four-year investigation by The Australian Financial Review has revealed.

The piracy cost the Australian pay TV companies up to $50 million a year and helped cripple the finances of Austar, which Foxtel is now in the process of acquiring.

The AFR investigation has revealed a global trail of corporate dirty tricks directed against competitors by a secretive group of former policemen and intelligence officers within News Corp, known as Operational Security.

Their actions devastated News's competitors, and the resulting waves of high-tech piracy assisted News to bid for pay TV businesses at reduced prices – including DirecTV in the US, Telepiu in Italy and Austar. These targets each had other commercial weaknesses quite apart from piracy, the AFR says.

The Australian Competition and Consumer Commission is still deliberating on final details before approving Foxtel's $1.9 billion takeover bid for Austar, which will cement Foxtel's position as the dominant pay TV provider in Australia.

News Corp has categorically denied any involvement in promoting piracy and points to a string of court actions by competitors making similar claims, from which it has emerged victorious. In the only case that went to court, in 2008, the plaintiff EchoStar was ordered to pay nearly $19 million in legal costs.

The issue is particularly sensitive because Operational Security, which is headed by Reuven Hasak, a former deputy director of the Israeli domestic secret service, Shin Bet, operates in an area which historically has had close supervision by the Office of the Chairman, Rupert Murdoch.

The security group was initially set up in a News Corp subsidiary, News Datacom Systems (later known as NDS), to battle internal fraud and to target piracy against its own pay TV companies. But documents uncovered by the AFR reveal that NDS encouraged and facilitated piracy by hackers not only of its competitors but also of companies, such as Foxtel, for whom NDS provided pay TV smart cards. The documents show NDS sabotaged business rivals, fabricated legal actions and obtained telephone records illegally.

The actions are documented in an archive of 14,400 emails held by former Metropolitan Police commander Ray Adams who was European chief for Operational Security between 1996 and 2002.

smh.com.au 28 Mar 2012

The Hollywood financiers are on an anti-piracy rampage, and are telling governments what laws to put in to stamp out piracy.

Individuals who are allegedly caught with pirated software are dealt with in such a manner that incarceration waits them upon successful prosecution.

Phone hacking / tapping that was conducted by the media mogul is also illegal, but there were no charges or incarceration bought about.

Similalry with this matter, there will be no criminal conviction against the corporate giant.

What will follow will be a media circus.

Certain perople who are supported by corrupt governments are truly untouchable.