News Corp denies James might ‘take a breather’

A spokesman for News Corp has denied a Reuters report that senior management at Rupert Murdoch's media empire are making plans should James Murdoch feel it necessary to "take a breather" from his job because of the pressures of the phone hacking scandal.

One high ranking insider is quoted as saying: "The company is still trying to operate as if James isn't going anywhere. But everyone is thinking about what will happen if he has to step aside."

Another source, said to be close to the Murdoch family, is reported to have said: "There needs to be some kind of separation for James from this issue before he can run the company more broadly."

While News Corp have officially dismissed the story as "absolutely not true" the fact that it comes from the reputable Reuters news agency gives it credibility.

Reuters have issued the report at time when pressure on the Murdochs is building again.

It is almost certain that members of the Commons culture committee will want James Murdoch to reappear before them to explain apparent discrepancies in his July 19 testimony.

This follows the emergence this week of documents including the 2007 Clive Goodman letter, in which the sacked royal reporter alleged that the practice of phone hacking was widely discussed at the News of the World and apparently condoned at the highest levels.

Goodman's comments appear to expose as a corporate pretence the notion – constantly espoused by Murdoch and other senior figures at News International - that he was a sole 'rogue' reporter.

Also this week, yet another former News of the World journalist has been arrested by police investigating the phone hacking scandal. As reported here yesterday, James Desborough had been based for the past two years in Los Angeles. If it should transpire that he used phone hacking techniques on American soil, then the ramifications for Murdoch's American interests are potentially enormous.

Today, Bloomberg is reporting that Murdoch's right-hand man, chief operating officer Chase Carey, is holding discussions with some of News Corp's biggest investors who are concerned about matters of governance at the company.

News Corp have declined to comment, but a spokesman for the California State Teachers' Retirement System, which holds 3.86 million Class A shares, confirmed it was involved in discussions. "Because this is delicate, we cannot say anything further about our efforts," a spokesman told Bloomberg.

James Murdoch holds three key roles in his father's organisation. He is deputy chief operating officer of News Corp, number two to Carey. He is also chief executive of News Corp's European and Asian operations, which includes overseeing the UK newspaper business through News International. And he chairs BSkyB, part-owned by News Corp.

If James Murdoch were to take a leave of absence from News Corp, it would probably only be temporary, according to the Reuters report.

"Even if he did step out of the spotlight for a while, that wouldn't necessarily mean he wouldn't come back when things are quieter," said one source.

Meanwhile his father has just sold the ranch he's owned for nearly 20 years in Carmel Valley, California. An omen? Apparently not. According to the Daily Telegraph, his young wife Wendi "didn’t see it in her future portfolio". ·