To use the argot of the New York streetfighter, Sir Richard never had beef with Rupert. Until now, the two most high-profile business figures in British media have, in the main, managed to happily coexist, and were once allies of a sort. In the bloody scrap that was the British Airways "dirty tricks campaign" against its smaller rival Virgin Atlantic, the Rupert Murdoch-owned Sunday Times stepped in on Virgin's side to uncover evidence that contributed to a £610,000 High Court victory in 1993. That was a settlement worth millions more to Branson in good publicity.
But any remaining goodwill that remained between these behemoths disappeared this month, as Murdoch, through his son, James, the chief executive of BSkyB, wrecked Branson's dream of taking control of Britain's largest commercial television network, ITV. BSkyB's swoop on a 17.9 per cent ITV shareholding effectively scuppered last week's bid for the broadcaster by NTL, the cable company in which Branson is the leading shareholder. And so the knuckledusters came out.
"All of us know governments are scared stiff of Murdoch," an irate Branson told The Daily Telegraph. "If the Sun, The Sunday Times, The Times, Sky, the News of the World, just to name a few of the things that Murdoch owns, all come out in favour of a political party, the election is likely to be won by that particular party. If you tag on ITV to that as well, basically we've got rid of democracy in this country and we might just as well let Murdoch decide who is going to be our prime minister." Branson's fears over Murdoch's growing influence were echoed, though less stridently, by Channel 4's chief executive, Andy Duncan, but elsewhere in the British media there was widespread admiration for a shrewd piece of business strategy by the old fox.
Having made a big play and failed, just three months before the crucial rebranding of NTL as Virgin Media, how badly damaged is Branson's own brand?
The Virgin founder famously likes to lead from the front. But in all his battles, from the "dirty tricks" fight through to the current scrap with the Murdoch clan, he has relied heavily on Will Whitehorn, as corner man and key tactician.
Whitehorn is the PR man who lives the dream, getting the chance to fly Virgin planes and to plan trips into space. Not for him the organising of laminate passes or the writing of press releases that no one bothers to read. Whitehorn is the PR who once flew a helicopter to pluck his boss to safety after he became caught up in the Algerian civil war of 1995. He is president of Virgin Galactica, which means he will be aboard the world's first commercial spaceship if Branson's extraterrestrial ambitions are realised. Officially, he is Virgin Group's brand development and corporate affairs director but in reality - though he dislikes the description - he is Sir Richard's right-hand man. Next year he celebrates his 20th anniversary at Branson's side.
This former North Sea helicopter search-and-rescue crewman doesn't seem intimidated by the prospect of a battle with Murdoch. He says he has been dismayed by the "fear" of commentators and MPs about criticising BSkyB's actions. "I kind of instinctively understood it before, but as we've never crossed swords with Sky in the past, I didn't quite understand how scared people are of the organisation, especially politicians."
As a spin doctor, he is already lining up the positives of the failed bid. "BSkyB has spent £1bn that it would otherwise have spent in the broadband market,' he observes, noting that with the combination of Virgin Net and NTL, the company soon to be known as Virgin Media is the "biggest provider of broadband in the country... which few people realise".
Furthermore, this ITV business isn't over yet. Whitehorn thinks that the Office of Fair Trade ought to act on an alleged breach of the Enterprise Act and is hopeful that BSkyB might be made to divest its new shareholding.
And the fact that BSkyB took the NTL bid so seriously, well that's another plus in Whitehorn's book. "It's a backhanded compliment to NTL, because Sky realised it was a massive move from the company. I think they were aware that the rebranding of the company as Virgin Media will be a success."
BSkyB had recognised something the rest of the British media had not understood, he thinks, namely the reinvigoration of NTL, which is still widely regarded as a failing, debt-laden company with a reputation for poor customer service. "A whole new team from Virgin has gone in there. In every matrix the company is doing quite well but it's still stuck with its legacy of the past. But it had the confidence to bid for ITV and that wouldn't have happened a year ago."
ITV could benefit from a similar injection of energy, he says, launching a tirade: "It's the biggest channel in the country in the commercial sector and yet Channel 4 gets five times as many hits a day on its website. ITV has patently failed to match the BBC in terms of television content. The BBC has made a success of the past few years by investing in content across every sector, from Doctor Who to Jane Eyre. Where's ITV's new Brideshead Revisited? There isn't one."
There is a feeling in media, and in business more generally, that Virgin gets away with a lot, that mistakes are made but yet somehow the Branson pixie dust never loses its sparkle. This could be a testimony to Whitehorn's talent at brand management, though he admits that his boss is a considerable asset when it comes to publicity and launching product.
"It's a great advantage having someone who is A-list celebrity status," he says. "The interesting thing about the British public is that there's no doubt that Richard Branson is the most powerful business brand in this country. The reason is he's someone the public feel always tells it like it is. One of the reasons for that is he's dyslexic and whatever is going on in that head of his normally ends up coming out."
Whitehorn joined Virgin when he was 26. The young Scot was enthused by the fresh business approach of an entrepreneur who began his own career as a 16-year-old publisher. The first edition of Student magazine (strapline 'Down with Education but not Vanessa Redgrave') is framed in the foyer of Virgin Group's Notting Hill HQ, where the PR supremo is based.
Adjourning to the local Starbucks for coffee and pain au chocolat, Whitehorn says the Virgin philosophy is based on a Japanese model and that it can be compared to other diverse entities such as Mitsubishi (banking to shipping) and Yamaha (pianos and motorbikes).
Accordingly, the Virgin brand can go almost anywhere, and if a foray is unsuccessful - so the theory goes - that brand remains undamaged. "One of the things that people expect from Virgin is to do things, we are expected to be a challenging brand and people are aware that not everything will work - you would cease to be seen as entrepreneurial if you became afraid of risk."
Consumers might be able to readily forgive flops such as Virgin Cola, though regular rail-users might be less sympathetic towards Virgin Trains, particularly on reading Whitehorn's assertion that the company had come clean about its failings "before it became the success it is today".
Despite the criticisms of ITV, Whitehorn says the British media is in good shape. "In print media we are pretty healthy compared with the USA where it's pretty bland. In many ways the media is our democracy because we have consensus politics."
The problem, says Whitehorn as he goes back on the PR offensive, is "creeping monopolisation" of media power. Who could he possibly be thinking of?
He notes News Corporation's ownership of MySpace and "40 per cent of the British print media" and describes BSkyB as "the most powerful broadcaster in the UK". He refers to the acquisitions of British businesses by Chinese and Russian companies and to Roman Abramovich's control of Chelsea football club.
Yet Virgin itself turns over £25bn around the world. It has radio interests in India, South Africa and Thailand and has ambitions to "build a global internet radio brand. That's a long-term play." It has mobile phone operations in America, Canada, France, Australia and South Africa, as well as the UK.
And when NTL's bid was rebuffed, many ITV executives actually reacted with relief, rather than mourning the failed rescue attempt by a bearded white knight.
Nonetheless, Sir Richard - who has few regrets but still pines over the failing of Event, the Eighties London listings magazine that he hoped would usurp Time Out - is determined that 2007 will be the year when he really raises his profile on the British media landscape.
Virgin, Whitehorn says, will not be backing away from this turf war. "The reason we have gone back into the UK media is that we saw the logic of linking Virgin Mobile with broadband, voice over internet, and television. That logic remains well beyond any deals with ITV."Reuse content