WSJ Europe publisher quits over circulation deal: paper

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The publisher of the Rupert Murdoch-owned Wall Street Journal Europe has resigned after an internal inquiry found editorial content was influenced by a circulation deal, the paper said Thursday.

Andrew Langhoff, managing director of Dow Jones & Co. in Europe, Africa and the Middle East, the Journal's parent company, stepped down "because of a perceived breach of editorial integrity", Dow Jones said in a statement.

But a report in the Wall Street Journal Europe said Langhoff resigned after an investigation found he pushed for two articles in the paper that favoured Netherlands-based consulting firm Executive Learning Partnership, or ELP, which had a commercial agreement with the paper's circulation department.

It quoted people familiar with the matter as saying that for two years ELP bought 12,000 copies of The Wall Street Journal Europe each day for one euro cent.

That helped the paper keep an audited circulation of about 75,000.

The Wall Street Journal and Dow Jones are owned by Australian-born media tycoon Murdoch's US-based News Corporation.

The Dow Jones statement said The Wall Street Journal circulation programmes were "fully disclosed and certified", but added that it had now halted the deal with the Dutch firm.

"The practice of sponsored distribution to business schools and universities is common in the industry and clearly identified in all WSJE publisher statements," it said.

"As we've stated, while the copies associated with ELP were legitimate and appropriate, we were not comfortable with the appearance of the programs and no longer have relationships with any of the third parties directly involved in these agreements."

The Guardian newspaper said it had found evidence that the Journal had been channelling money through European companies in order to buy thousands of copies of its own paper at a knock-down rate.

Dow Jones rejected the "inflammatory characterisation" by The Guardian of the circulation programme, saying it was "replete with untruths and malign interpretations."

The controversy is a fresh blow to Murdoch's media empire following the closure of the News of the World, Britain's top-selling Sunday newspaper, in July over a scandal involving the illegal hacking of voicemails.

It is also the latest departure of a senior Dow Jones figure after long-time Murdoch aide Les Hinton resigned as chief executive in July over the phone-hacking scandal.

According to sources quoted by the Wall Street Journal Europe, Langhoff sent an email to staff saying that the relationship with ELP, "overseen by a now-former employee, is no longer in place."

"Because the agreement could leave the impression that news coverage can be influenced by commercial relationships, as publisher with executive oversight, I believe that my resignation is now the most honorable course," he said.

The paper however quoted people familiar with the matter as saying that Langhoff personally pressured two reporters into writing articles featuring ELP.

It also reported that Langhoff and other officials at the paper "executed several side deals" in which the paper directed thousands of euros to the Dutch firm through third-party companies for services ELP said it provided at events.

The Dow Jones statement said the payments to the Dutch firm were "admittedly complex but nevertheless legitimate."

© 2011 AFP

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