December 4, 2021

BBC to Sell Lonely Planet Guidebooks to a U.S. Billionaire

SERRAVAL, France — In 2007, when the British Broadcasting Corporation bought the Lonely Planet travel guidebooks, it drew criticism from rival media organizations in the private sector, which argued that a public television company had no business expanding into areas like book publishing.

On Tuesday, when the BBC confirmed plans to sell Lonely Planet to a reclusive American billionaire, it drew internal scrutiny — this time for losing money on the sale.

BBC Worldwide, an arm of the public broadcaster that runs many of its international and profit-making operations, said on Tuesday that it had agreed to sell the series to NC2 Media, a company controlled by Brad M. Kelley, a businessman from Kentucky who made a fortune in tobacco and later turned his attention to real estate and other interests.

The price, £51.5 million, or $77.8 million, was nearly £80 million below the £130 million that the BBC paid for Lonely Planet, in two stages.

The BBC insisted that no public money was lost because BBC Worldwide used its own money rather than the main BBC budget, derived largely from a license fee on British television-owning households, to pay for Lonely Planet. Still, because BBC Worldwide returns any profit it earns to the BBC, any shortfall affects the BBC’s overall funding.

The scale of the loss on the sale of Lonely Planet prompted the BBC Trust, a panel that oversees the broadcaster, to call on the executive arm of the BBC to begin a review of the investment and report its conclusions.

“Although this did not prove to be a good commercial investment, Worldwide is a very successful business, and at the time of purchase there was a credible rationale for this deal,” Diane Coyle, vice chairwoman of the trust, said in a statement.

At the time of the purchase, the BBC — headed then by Mark Thompson, who is now chief executive of The New York Times Company — talked about extending the Lonely Planet brand into new areas, including digital outlets. But publishers of traditional travel guidebooks have struggled to compete with travel sites on the Web, like TripAdvisor.

And rivals of the BBC complained that the broadcaster had no business moving into new areas at a time when some commercial media companies had struggled with the challenge of the Internet.

In 2009, James Murdoch, then the head of the European and Asian operations of News Corporation, described the BBC’s purchase as a “particularly egregious example of the expansion of the state.” In addition to its other media holdings, News Corporation is the largest shareholder in British Sky Broadcasting, a pay-TV company that competes with the BBC.

The BBC has been scaling back since it agreed to a reduction in its public financing in 2010.

“Lonely Planet has increased its presence in digital, magazine publishing and emerging markets whilst also growing its global market share, despite difficult economic conditions,” said Paul Dempsey, interim chief executive of BBC Worldwide, in a statement. “However, we have also recognized that it no longer fits with our plans to put BBC brands at the heart of our business and have decided to sell the company.”

Despite the challenges facing travel publishers, the BBC said Lonely Planet was the biggest travel guidebook series in the United States, Britain and Australia, where the guides were founded in 1973 as a bible for backpackers. It said 120 million books had been published in 11 languages, and 120 million people visited its Web sites annually.

“The challenge and promise before us is to marry the world’s greatest travel information and guidebook company with the limitless potential of 21st century digital technology,” Daniel Houghton, executive director of NC2 Media, said in a statement. “If we can do this, and I believe we can, we can build a business that, while remaining true to the things that made Lonely Planet great in the past, promises to make it even greater in the future.”

The purchase is a big expansion of Mr. Kelley’s media holdings; he also has an investment in OutWild TV, a Web site that shows travel videos. Mr. Kelley is said to be one of the largest private landowners in the United States, with millions of acres of land in Texas and other states.

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Cameron Orders Two Inquiries Into Hacking Scandal as Former Aide Is Arrested

Struggling to contain the biggest scandal since he took office more than a year ago, Mr. Cameron announced two separate inquiries into the revelations, saying “no stone will be left unturned.”

In a statement, Scotland Yard said Andy Coulson, Mr. Cameron’s former director of communications, had been interviewed at a police station in south London and was “currently in custody.”

While his arrest had been expected, it brought a new dimension to the scandal, turning it from one of claim and counter-claim to a question of criminal charges.

A police statement said the former editor had been arrested “on suspicion of conspiring to intercept communications” and “on suspicion of corruption allegations.” It said he had been interviewed by officers investigating illegal payments to corrupt police officers and phone hacking.

The arrest came as Mr. Cameron scrambled desperately to contain the fallout from scandal and focus public attention on measures being taken to investigate it. But it was certain to draw renewed taunts by Mr. Cameron’s critics that he showed flawed judgment in hiring Mr. Coulson in 2007. In the past, the prime minister has always vouched for Mr. Coulson’s integrity and said he believed Mr. Coulson’s assurances that he had done nothing wrong.

The developments followed a decision by Rupert Murdoch’s family on Thursday to close The News of the World — the tabloid newspaper at the center of the scandal over illicit payments to corrupt police officers and the hacking of cellphones belonging to victims of crime and terrorism and possibly families of soldiers killed in Iraq and Afghanistan.

The decision seemed to be a calculated move to help protect Mr. Murdoch’s proposed $12 billion takeover of the pay-television company British Sky Broadcasting. Mr. Murdoch already owns a controlling 39.1 percent stake in it; the deal would allow him to own it outright.

Members of the British public had until Friday to make their views known to the culture secretary, Jeremy Hunt, who is to rule on the takeover. The BBC said some 256,000 individuals had lodged objections, many in recent days, and it could take months to sift through them.

Before the phone-hacking crisis exploded this week, Mr. Hunt had been expected to approve the deal, possibly this week. But he indicated on Friday that a decision would take longer.

In a statement, his office said that “given the volume of responses,” it would “take some time” to make a ruling. Mr. Hunt “will also consider all relevant factors” including the impact of the closure of The News of the World, the statement said.

The repercussions from the crisis also seemed to be spreading to the question of media regulation.

At a hastily-convened news conference to unveil his plans for inquiries, Mr. Cameron also proposed an extraordinary tightening of regulations on the behavior of the free-wheeling British press, which prides itself on investigative prowess far beyond the tabloid titillation with which some of its titles are associated.

“I believe we need a new system entirely,” Mr. Cameron declared, saying the current self-regulation of the press by a body called the Press Complaints Commission has “failed.” The scandal has shaken the intertwined worlds of press and politics, laid bare the cozy ties between British leaders and Mr. Murdoch and raised questions about the future of two once high-flying newspaper executives — Mr. Coulson and Rebekah Brooks, the current chief executive of Mr. Murdoch’s newspaper operations in Britain who herself had been editor of The News of the World.

At his news conference, Mr. Cameron spoke with a rare candor about the darker practices that have been common in the British press, particularly tabloids like the News of the World, whose power to destroy reputations has spread widespread fear among politicians, celebrities and others in the public eye.

The prime minister said he would ask the inquiry he plans to appoint to make a sweeping review of “the culture, the practices and the ethics” of  the country’s newspapers. But he also acknowledged that politicians have traditionally failed to speak up about press abuses for fear of alienating press barons with the power to wreck their careers  or their parties’ electoral prospects.

John F. Burns reported from London and Alan Cowell from Paris. Reporting was contributed by Sarah Lyall, Jo Becker, Julia Werdigier and Ravi Somaiya from London, Jeremy Peters, Brian Stelter and Tim Arango from New York.

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