If this was tough, Rupert Murdoch, wait till the US inquisition starts

After his appearance in London – a mixture of apologies and throwing another few editorial shrimps on the barbi – the mogul should now prepare for an extensive probe at the very heart of his empire

Rupert Murdoch after giving evidence at the Leveson inquiry (AFP)

Rupert Murdoch's evidence to the Leveson judicial inquiry was to be one of those rare moments when a global business tycoon, usually shielded from accountability by his wealth and influence, was to be subjected to very uncharacteristic public scrutiny. It was to be, his critics hoped, the moment when the curtain was pulled back and this wizard of Oz was revealed to be a manipulating puppet-master pulling the strings of politicians in pursuit of power and profit. His admirers were less hubristic, warning that Murdoch, the wily survivor of countless bruising encounters, was most dangerous when cornered.

The two days of questioning certainly brought the anticipated high drama. By the end of it, a cabinet minister's career was twisting in the wind, as the Murdochs', senior and junior, appearances resulted in a fresh injection of fuel into the phone-hacking conflagration that was already burning merrily.

At the end of it, as his admirers pointed out, Rupert Murdoch was still standing. Still swinging, in fact. They hailed a bravura performance. There was the recognition that the scandal at the News of the World (NOTW) left "a serious blot on my reputation". The mea culpa: "I have failed. The NOTW was an aberration, and it's my fault," he said. The contrition: "I am very sorry about it." He should have closed the newspaper down years ago, he claimed.

His roles ranged from "doddery amnesiac", when seeking to avoid awkward questions, to Mafia Godfather, as he dished out ice-cold revenge on his enemies.

Former editors were all criticised personally, including Andrew Neil, David Yelland, and Harold Evans. Colin Myler, the last editor of the now closed NOTW was singled out for special attention, without even being named. In his own mind at least, Rupert portrayed himself as a victim of a conspiracy by "one or two very strong characters" at the newspaper. They included, he claimed, "a clever lawyer", which prompted Tom Crone, former senior lawyer at NOTW, to later call Murdoch's claim a "shameful lie".

Mr Crone said: "It is perhaps no coincidence that the two people he has identified in relation to his cover-up allegations are the same two people [Crone and Myler] who pointed out that his son's evidence to the parliamentary select committee last year was inaccurate."

Murdoch dismissed as "myth" the idea that he exercised undue political influence or that he traded the backing of his papers for political favours. As he did, the sound of score settling was deafening. Gordon Brown was "unbalanced", he claimed. Sir John Major, was damned by Murdoch's near-zero recall of him. "I have no recollection of those meetings [with Major]." When it was put to him that he wasn't "that appreciative" of Major, Murdoch added: "Or his government."

Tony Blair "impressed" him, so much that Mr Blair became godfather to his daughter Grace, but he insisted he never asked Mr Blair for anything. "Nor, indeed, did I receive any favours." He could not recall Mr Blair pledging not to tighten up the media ownership rules during a meeting with him, as recorded in Alastair Campbell's diaries.

When, after two days of skirmishing, the smoke cleared from the battlefield and the casualties were counted, many observers were still far from certain who could claim victory. For some, it was clear Murdoch was the loser. Brian Cathcart, professor of journalism at Kingston University, said the email evidence between Murdoch lobbyist Frédéric Michel and the Culture Secretary Jeremy Hunt's office revealed "in cold detail, the nuts and bolts of a mighty machine of corrupting political influence. This was much more than lobbying; it was manipulation, even puppetry, and it was done in Rupert Murdoch's name. Even if (wink, wink) when the mogul met the Prime Minister nothing substantive was ever talked about, we now have chapter and verse about the abuse of power going on beneath the surface." Murdoch senior's testimony amounted to a "farewell performance", he argued.

If this was Rupert Murdoch's valediction, then some believe it resembled the chaotic scramble for the last helicopter departing from the US embassy roof in Saigon in 1975. His performance at Leveson witnessed the jettisoning of the last of the cumbersome and unwanted luggage which he, his family and News Corporation, the parent company of his UK-media empire, were finding so burdensome. All sentiment was gone. The fate of his newspapers, which many believed Rupert cherished beyond a point where it made economic sense, is more uncertain than ever.

Blame, as far as Murdoch was concerned was firmly apportioned well away from his son James and his quasi-daughter, Rebekah Brooks.

However, the idea that the Murdochs may have escaped relatively unscathed is largely illusory. Next Tuesday, the publication of a Commons select committee report will see if MPs believe the Murdochs misled Parliament when they gave evidence about the phone hacking.

More worryingly from the Murdochs' viewpoint, the scandal is threatening to ignite in the US, where it could truly damage them and their empire, although if so, the fuse is long and slow. Mark Lewis, the London solicitor who has done as much as anyone to take the fight to Rupert, said yesterday that he was bringing more cases against News Corp in the US. "The suggestion in the US that people have stood up to a News Corp subsidiary has bolstered the confidence of others who claim that they are victims of the company." Among them is Koo Stark, the photographer, author and TV presenter, who was reported to be suing the Murdoch empire after allegations that her phone had been hacked while she was on US soil. The revelation that the Leveson inquiry was pressing the Murdochs to allow Burton Copeland, the London law firm called in to advise them on the phone-hacking allegations, to hand over potentially incriminating documents about an alleged cover-up could have major ramifications for the Murdochs in the US.

While questioning Murdoch senior, inquiry counsel Robert Jay QC, revealed that News Corp, despite denials, was still refusing to waive legal privilege over the advice Burton Copeland provided them with after the arrest of Glenn Mulcaire, a private detective who was working for the newspaper.

Mark Lewis said: "I have no doubt that the US financial authorities will be very keen to see the Burton Copeland report to see whether information was not just withheld from Rupert Murdoch as he says, but also from shareholders and other investors."

Peter Jukes, who has written a book about the Murdochs, said: "Rupert's position on the News Corp board is pretty unassailable. There's months before the next shareholders' meeting, and the buy-back of shares is keeping the price up. As Mark Lewis brings his civil cases in the US, there will be slow legal disclosure. They're all watching the UK, agog."

Murdoch's biographer Michael Wolff thinks there is little appetite in the Obama administration for taking on Murdoch. "I don't know anyone who thinks Obama has the political will to go after him now," says Wolff. "That would probably change if he was to be re-elected. For now. the story hasn't really made the leap to the US, though I'm surprised the Leveson inquiry hasn't spoken to more people who were working with Rupert in the US in 2007, like Les Hinton. They don't seem to have pursued them."