Brooks out and Murdoch humbled on day of atonement

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Tycoon said to have had his head in his hands as he apologised to the Dowlers

Rupert Murdoch, the world's most powerful media tycoon, held his head in his hands last night as he offered a humble apology to Milly Dowler's family for the hacking of her phone by the News of the World.

At a meeting at the five-star One Aldwych hotel in central London with the murdered schoolgirl's parents, Sally and Bob Dowler, and her sister, Gemma, Mr Murdoch repeatedly said sorry for the distress his paper had caused them, according to their lawyer, Mark Lewis.

It was a torrid day for the embattled magnate, who appeared at the entrance of the hotel to announce he had apologised just seven hours after Rebekah Brooks confirmed her resignation as chief executive of News International. In turn, that brief appearance was followed just four hours later by the exit of another of his key henchmen, Dow Jones chief executive Les Hinton.

Flanked by the Dowlers, Mr Lewis said of Mr Murdoch: "He was humbled to give a full and sincere apology to the Dowler family. The Dowler family told him that his papers should lead the way to set the standards of honesty and decency in the field, and not what had gone on before.

"He apologised many times," Mr Lewis added. "I don't think anybody could have held their head in their hands so many times." He said Mr Murdoch had told the family that the NOTW's actions were "not the standard set by his father, a respected journalist, not by his mother".

A private investigator working for the NOTW is thought to have deleted messages from Milly's phone soon after she went missing in 2002, to make room for more recordings that could then be eavesdropped. The hacking gave the Dowler family false hope that their daughter might still be alive. As Mr Murdoch emerged from the hotel, a handful of protesters shouted "shame on you". Mr Hinton joined his boss in saying sorry in his resignation letter, saying of the hacking: "The pain caused to innocent people is unimaginable". He added that while he had been "ignorant" of these activities, he felt it was "proper for me to resign from News Corp".

News International today took the unprecedented and humiliating step of taking out full-page apologies in rival newspapers across Fleet Street as its latest strategic move in trying to limit the damage being caused to its corporate reputation by the hacking scandal.

The apology seemed to contradict comments made by Mr Murdoch in an interview with The Wall Street Journal yesterday when he described the failings at NI as "minor mistakes".

Associated Newspapers, publisher of the Daily Mail and The Mail on Sunday, is set to launch a new Sunday tabloid into the popular market vacated by NI with the closure last weekend of the NOTW. The new paper, which could be named The Sunday or The Sunday Lite, is being prepared for an imminent launch, possibly before the end of the month. Trinity Mirror's Sunday newspapers are being ordered to produce bumper editions tomorrow to cash in on the demise of the NOTW, while Richard Desmond's Northern & Shell used TV advertising to promote its Daily Star Sunday – "the paper you can trust" – and a new supplement called OK! Extra.

The Murdochs' public-relations offensive and the departure of Ms Brooks helped to solidify Wall Street support for News Corp, which has been steadily reversing the share price fall of early this week.

Investors have generally regarded the company's newspapers as an indulgence of the senior Mr Murdoch, so there was support for the installation of a new chief executive at News International who is best known for his work in the television industry. Tom Mockridge, who has built Sky Italia into a highly profitable business, is closely allied with James Murdoch, the strongest internal advocate for reducing the company's exposure to the newspaper industry.

A Sorry Affair

Rupert Murdoch met the family of the murdered schoolgirl Milly Dowler yesterday to apologise for the hacking of her phone.

He also bought full-page advertisements in the UK national newspapers which appear today, apologising for the paper's wrongdoing.

The letter, which carries his signature, reads: "We are sorry. The News of the World was in the business of holding others to account. It failed when it came to itself. We are sorry for the serious wrongdoing that occurred.

"We are deeply sorry for the hurt suffered by the individuals affected.

"We regret not acting faster to sort things out.

"I realise that simply apologising is not enough.

"Our business was founded on the idea that a free and open press should be a positive force in society. We need to live up to this.

"In the coming days, as we take further concrete steps to resolve these issues and make amends for the damage they have caused, you will hear more from us.

Sincerely,

Rupert Murdoch."

Rebekah Brooks' Statement

At News International we pride ourselves on setting the news agenda for the right reasons. Today we are leading the news for the wrong ones.

The reputation of the company we love so much, as well as the press freedoms we value so highly, are all at risk.

As chief executive of the company, I feel a deep sense of responsibility for the people we have hurt and I want to reiterate how sorry I am for what we now know to have taken place.

I have believed that the right and responsible action has been to lead us through the heat of the crisis. However, my desire to remain on the bridge has made me a focal point of the debate.

This is now detracting attention from all our honest endeavours to fix the problems of the past.

Therefore I have given Rupert and James Murdoch my resignation. While it has been a subject of discussion, this time my resignation has been accepted.

Rupert's wisdom, kindness and incisive advice has guided me throughout my career and James is an inspirational leader who has shown me great loyalty and friendship.

I would like to thank them both for their support.

I have worked here for 22 years and I know it to be part of the finest media company in the world.

News International is full of talented, professional and honourable people. I am proud to have been part of the team and lucky to know so many brilliant journalists and media executives.

I leave with the happiest of memories and an abundance of friends.

As you can imagine, recent times have been tough. I now need to concentrate on correcting the distortions and rebutting the allegations about my record as a journalist, an editor and executive.

My resignation makes it possible for me to have the freedom and the time to give my full co-operation to all the current and future inquiries, the police investigations and the CMS (Culture, Media and Sport Select Committee) appearance.

I am so grateful for all the messages of support. I have nothing but overwhelming respect for you and our millions of readers.

I wish every one of you all the best.

James Murdoch's statement

I am writing to update you on the actions we have been taking as a company to solve the problems at News International relating to the News of the World ... .

Earlier today, Rebekah Brooks resigned from her position as CEO. I understand her decision and I want to thank her for her 22 years of service to the company. She has been one of the outstanding editors of her generation and she can be proud of many accomplishments as an executive. We support her as she takes this step to clear her name.

We have created an independent Management & Standards Committee and I want to emphasise its importance. The Committee has direct governance and oversight from News Corporation Board members and is codifying standards that will be clear and enforced.

We made the difficult and necessary decision to close the News of the World. A number of other executives have now left the Company. News Corporation also withdrew its proposal to acquire the shares in BSkyB it does not own. This is a strong signal that our top priority in the UK is to address the issues facing News International.

Looking to the future, I am also pleased to tell you that Tom Mockridge will become CEO of News International. Tom is in London today and will start right away. Tom is a highly respected and accomplished media executive who has served as CEO of Sky Italia since its launch in 2003. Tom, who has also been in charge of our European Television business, started his career as a newspaper journalist in New Zealand and he has held a range of top roles in the newspaper industry. The creation of TG-24, Italy's only truly independent 24-hour news channel, is a credit to Tom's leadership and integrity.

This weekend, News International will run advertisements in all national newspapers. We will apologise to the nation for what has happened. ... Next week, my father and I will appear before the Commons Media Select Committee and will speak to them directly about our determination to put things right.

The Company has made mistakes. It is not only receiving appropriate scrutiny, but is also responding to unfair attacks by setting the record straight.

I would like to conclude by saying thank you. Throughout this time, you have gotten out great papers every day and have stayed focused.

I am deeply grateful for that.

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