A political scandal in the UK involving allegations of phone tapping has pitched two of the great family media dynasties against each other. The outcome could have considerable consequences for both, writes Katie Barker.
The scandal began in 2006 and centres around allegations that Murdoch-owned tabloid News of the World hacked into the telephone messages of UK royals and celebrities in order to get stories.
There have already been two parliamentary reviews investigating the claims, which resulted in the jailing of News of the World journalist Clive Goodman and private investigator Glenn Mulcaire in 2007.
The original investigation touched on the role of the newspaper's editor at the time, Andy Coulson. He has always denied any knowledge of the actions of Goodman and the News of the World has maintained that the practice was not encouraged but the actions of one rogue journalist. The sentencing of Goodman and Mulcaire seemed to draw a line under the scandal and Coulson has since gone on to become the new prime minister David Cameron's chief media adviser.
But an article in the Sulzberger-controlled New York Times on 1 September reignited the debate. The investigation by the newspaper suggests Coulson was fully aware of the phone hacking and in fact actively encouraged it. And the investigation is not confined to calling for a further look into Coulson and his role, but goes on to make accusations directly linked to Murdoch's News International.
There is some debate as to why the US-based New York Times got involved at all in a primarily UK problem. It might have something to do with a move made by Murdoch earlier this year when he launched a daily New York section of his Wall Street Journal that competes directly with the New York Times. However, the newspaper also has a reputation for good investigative journalism and uncovering stories such as this one, as its array of Pulitzer Prizes emphasise.
Both Murdoch and Sulzberger have much to lose if they have pitched themselves on the wrong side of the debate. The New York Times Company is struggling with debts of more than $600 million and last year was forced to sell assets in order to decrease the debt burden on the publishing group.
Although the company's most recent financial figures show revenues were up 1% year-on-year in the last quarter, the company will need a few more quarters of advertising growth before they can show they are definitely back on track.
And if Coulson is found guilty, it could undermine the Murdoch media empire's reputation for integrity. That is something the world's biggest family-controlled media business doesn't want.