The would-be emperor's slow striptease

By G.L. | NEW YORK

JAMES MURDOCH's resignation as chairman of BSkyB, announced today, looks like an exercise in damage limitation. The question is, damage to whom: BSkyB, or Mr Murdoch himself.

In the statement from BSkyB—his stewardship of which, as its chief executive and later chairman, has been one of the highlights of Mr Murdoch's career—he says:

"I am aware that my role as Chairman could become a lightning rod for BSkyB and I believe that my resignation will help to ensure that there is no false conflation with events at a separate organisation."

That "separate organisation" being, of course, News International, the chairmanship of which Mr Murdoch quit in February over the phone-hacking scandal. His father Rupert Murdoch's News Corporation owns both News International and the largest single stake (39%) in BSkyB. Ofcom, Britain's broadcast media and telecoms regulator, has been investigating whether, in the light of the phone-hacking affair, BSkyB is "fit and proper" to hold a broadcasting licence. Removing the man who supervised both companies from the chairmanship of BSkyB should give Ofcom one less reason to revoke the licence, and satisfy some shareholders who have been calling for him to go.

But the purpose could be just as much to insulate Mr Murdoch. BSkyB's board, which up to now has supported Mr Murdoch unanimously, is due to replace some retiring directors soon, and having more hostile members on it while he remains chairman would be bad for his already tarnished image. Resigning now also means he will be slightly less in the line of fire when Ofcom and the Leveson inquiry, which is investigating the phone-hacking, report on their findings.

Finally, it might protect him in case any further muck arises following last week's fresh allegations about smart-card piracy at NDS, the pay-TV software company that News Corp also owns. Such piracy, which NDS denies encouraging (and has fought off several lawsuits alleging so), was one of the reasons behind the collapse of ITV Digital (previously ONdigital), BSkyB's chief rival, in 2002. Mr Murdoch became chief executive of BSkyB only in 2003, and before that he was never more than a non-executive director of NDS, so his name has never been linked to the piracy claims; but it certainly makes sense now to distance him from them.

All this would be in line with the idea that Mr Murdoch is still being groomed to take over the leadership of News Corp when his father retires or dies. But Murdochologists are divided on this. A not uncommon view is that his recent move from London, where he had his power base, to New York, the fief of Chase Carey, the chief operating officer and his direct boss, was more of an emasculation than a promotion. Moreover, the company's international pay-TV businesses are part of his new remit, and with the removal of BSkyB, that remit just got a good bit smaller. It is unclear, then, whether the progressive stripping of the emperor-to-be's old clothes is meant to prepare him for new ones, or to leave him naked.