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Denis O’Brien extends his media empire - my media mogul story

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Denis O'Brien (Laura Hutton/Photocall Ireland)
Back in the early 1990s when I was editing a new weekly section for the Irish Independent called Dubliners I started an annual competition called Dubliner of the Year.  Because of limited budgets in the paper (some things never change) and also to give the competition a wider reach, I got one of the new commercial radio stations involved as a media partner. 

Which is how, a year later, I ended up at a lunch hosted by the lord mayor, the Independent and the radio station, at which the monthly winners of the competition and their families were wined and dined and the Dubliner of the Year was announced.

I don't remember too much about the lunch, except that the monthly winners of the competition, who had been nominated by the readers and listeners, were all true Dubs. 

They included some real characters with great stories to tell, some of  whom were doing fantastic work in their local communities.  Official lunches and award ceremonies can be tedious affairs, but this one was a riot.

Not counting the lord mayor (and no one did), there were to be two speakers at the event, myself on behalf of the paper and a hot young businessman called Denis O'Brien, the boss of the radio station we had got on board.  As the pre-lunch reception was concluding, O'Brien arrived in his limo, wearing an expensive suit and a perma tan, a man in a hurry.

I went over to meet him, but even as we shook hands his eyes were already scanning the room behind me for someone more important.  Failing to see anyone who mattered, he allowed his PR handler to steer him to his place at the top table; he subsequently delivered a bland speech he had clearly not read before, posed for a picture with the winner ... and then he was out of there. 

I remember thinking at the time that it was his loss.  There were some great people in the room, even if they were ordinary Dubs, and the party went on late into the afternoon. 

I was struck at the time by his ruthlessness and time management.   But the next day's paper had the picture of Denis with the winner which, of course, was what his PR team were after.
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----------------- Even then, still in his thirties, he was someone going places fast.  By last week, some 20 years later, he had not only become Ireland's wealthiest businessman (he has been for some time) but he also finally got control of Tony O'Reilly's media empire, Independent News and Media, the publisher of the Irish Independent as well as many other papers. 

He's still ruthless and his time management is still pretty impressive. And he's still a man in a hurry, as we have seen from some of the revelations about his business dealings. 

Now 54, O'Brien is a self-made billionaire, although he did come from a family with good business contacts.

As young hotshots, he and Michael O'Leary got their first break when they were hired by the late Tony Ryan who started the aircraft leasing giant GPA and also Ryanair.   O'Leary now runs Ryanair, of course, but O'Brien soon went off to do his own thing.   

One of his businesses was commercial radio, and by the time I had the above encounter with him he already had several stations.   (His Communicorp company now owns six stations in Ireland, including influential outlets like Newstalk and Today FM, and it also runs more than 30 stations in eight or nine other countries.) 

But it was the cell phone business that really made him.   In the mid-1990s he and some partners applied for and, in spite of being the outsiders in the process which included some very experienced international operators, won Ireland's second mobile phone license. 

It was, as they say, a license to print money.  Before too long he sold his personal share in the venture to British Telecom for over £250 million and went to live in Portugal to avoid paying the £50 million Irish tax that was due on it. 

That £250 million was to be the foundation of everything that followed, the seed capital.   He was soon back in the cell phone business again, setting up Digicel, the cell company that now has operations in the Caribbean, Central America and other regions, with well over 10 million subscribers.  Revenues run to billions of dollars. 

He is also involved in other business areas, like aircraft financing, property, oil, web services, golf courses, and so on.   These days his personal worth is around €3 billion.

But it is his media involvement that put him in the headlines here last week when he swallowed up Independent Newspapers, the media empire run for almost 40 years by Tony O'Reilly and more recently his son Gavin. 

Having ploughed more than half a billion euro into shares in Independent News and Media (INM) in recent years, O'Brien finally got control last week and the young O'Reilly was out. 

To add to all his radio stations, O'Brien now has all INM's papers in Ireland as well as papers in South Africa and Australia.   This makes him a major media player, and in Ireland gives him a dominance that is worrying for two reasons. 

Firstly, there is the big question mark over his financial dealings, and secondly, there are concerns about one person controlling so much of the media here.   

The financial question arises from the findings of the Moriarty Tribunal (one of the judicial inquiries here into corruption) which found that O'Brien gave almost £450,000 directly to Michael Lowry, the minister in the last Fine Gael government in the 1990s whose department was running the competition for the cell phone license which O'Brien eventually won.

O'Brien also guaranteed loans and made other financial arrangements that benefited Lowry around the same time.  It all added up to around £1 million he gave to Lowry (this was before we went on to the euro and is equivalent to almost €1.4 million). 

According to the tribunal, Lowry had an "insidious and pervasive" influence on the competition, and gave O'Brien "substantive information" that helped his consortium win the license. 

Moriarty also found that Lowry "not only influenced, but delivered" the license  to O'Brien. 

Both Lowry and O'Brien have rejected the tribunal report, but there's no sign of them challenging the findings in the High Court.   What it amounts to in plain English is a finding that suggests O'Brien bribed Lowry to give him the cell phone license. 

As I said above, this is critical because it was the foundation on which O'Brien's business empire was
built. The tribunal findings cannot be used in a criminal prosecution because a different standard of proof is used.

Tribunals make findings based on the balance of probability rather than beyond a reasonable doubt.
For that reason, the Gardai (police) have to start from scratch when building a case, even if they have clear pointers from a tribunal report. 

So far, there is no sign of the state bringing corruption charges against O'Brien (or any charges against 95% of the business leaders who got the country into its present mess -- the contrast with what happens to people like Bernard Madoff in the U.S. is striking). 

But the concern over O'Brien's business ethics remains, and many people here believe he should be shunned by the state because of the damning tribunal findings against him.

Which is why there was such a furor in the media here when he was pictured on the balcony of the New York Stock Exchange at the recent bell-ringing ceremony with the Taoiseach (Prime Minister) Enda Kenny. 

Of course it is also true that he provides lots of jobs and is a big donor to lots of charities.   But he is also a tax exile, like the other Irish billionaires who like to lecture us on how to save the Irish economy. 

And does giving to charity and providing jobs mean we should overlook the very serious questions
about his financial past?  

All of  which raises concerns about his suitability as a media mogul in Ireland. He now has effective control of the INM papers in Ireland which include the Irish Independent, Sunday Independent,
Evening Herald, Sunday World, The Star, The Belfast Telegraph and its weekend paper Sunday Life.  INM also has a large stable of local papers across Ireland.
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----------------- Together, this makes INM by far the most dominant player in print in Ireland.  Added to all O'Brien's radio stations here, it will give him an extraordinary level of potential influence in Ireland, to a level that puts Rupert Murdoch in the shade in other markets.

Is this healthy for the Irish media or for Irish democracy?  The answer has to be no.

Even if there were no worries about O'Brien's probity, to allow such dominance of the media in one country seems dangerous, to say the least.  

The government here is now trying to decide what to do about the situation.

Arguments about cross-media ownership are being made by journalists, lawyers and people from many areas of Irish public life.  It has been suggested that a legal cap must be introduced to limit cross-media ownership by one person or company. At present there is no such legal bar, apart from the ordinary competition rules that apply to all industries.   

This story , as they say, will run and run.

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