The circumstances were that the authority for the bid was taken away from Business Secretary Vince Cable after he was caught telling undercover newspaper reporters that he had “declared war” on Murdoch, the powerful News Corp. chairman and CEO.

“The crucial point, the really crucial point, is did Jeremy Hunt carry out his role properly with respect to BSkyB? And I believe that he did,” Cameron said.

The embattled Hunt will make his own case next Thursday when he testifies at the Leveson Inquiry which is investigating phone hacking at News Corp. newspapers and broader media issues. Former Prime Minister Tony Blair will testify on Monday and Cable on Wednesday, officials said.

On Thursday, the inquiry published a memo dated Nov. 19, 2010, from Hunt to Cameron reporting that Murdoch’s son James was “pretty furious” about the obstacles to the company’s bid for the lucrative broadcaster.

James Murdoch, who was then chairman of BSkyB, hoped the takeover would shake up Britain’s media industry the same way his father had done in the 1980s by revolutionizing newspaper production, Hunt wrote.

“He wants to create the first multiplatform media operator,” Hunt wrote. “If we block it our media sector will suffer for years.”

The memo, written about a month before Hunt he was given responsibility for ruling on whether to refer Murdoch’s bid to competition regulators, showed the degree to which Hunt sympathized with the New York-based News Corp.

The company, which owns 39 percent of BSkyB, dropped its bid to take full control after the hacking scandal blew up last year.

Critics say News Corp.’s influence over U.K. politicians was one of the reasons the company was able to get away with wrongdoing in Britain for so long.

Cameron has faced questions about why he appointed Andy Coulson, former editor of News of the World, the Sunday tabloid at the heart of the hacking scandal, as his director of communications.

Questions have also been raised about Cameron’s friendly relations with Rebekah Brooks, former CEO of News Corp. subsidiary News International, who has been charged with conspiring to obstruct justice.

London’s Metropolitan Police announced Friday they had arrested a 37-year-old female journalist in their bribery investigation, based on information supplied by News Corp. It was the 30th arrest on suspicion of making or accepting bribes.

The bid was abandoned last year as News Corp. was engulfed in a phone hacking scandal at News of the World, its top-selling Sunday tabloid, which was shut down as a result in July. The same scandal prompted Prime Minister David Cameron to appoint Justice Brian Leveson to lead an inquiry into media wrongdoing.

Journalists at the now-defunct tabloid routinely hacked phones to get stories, bypassing weak security to illegally eavesdrop on private conversations of politicians, celebrities, sports stars and other public figures. The scandal has rocked Britain’s establishment, leading to the arrest of dozens of people and casting a harsh light on relations among Britain’s press, politicians and the police.

Hunt’s contacts with Michel are an issue because the minister was supposed to be acting in a “quasi-judicial” role, aloof from contacts with interested parties. Yet a cache of emails disclosed by News Corp. has raised questions about whether Hunt strayed from that impartial role.

Michel made 191 telephone calls and sent 158 emails and 799 texts to Hunt’s office between June 2010, when News Corp. — the biggest shareholder in BSkyB — announced its bid to buy out other shareholders, and July 2011, when the bid was abandoned.

More than 90 percent of those contacts were with Hunt’s special adviser Adam Smith, Michel said.

Although Michel’s emails to News Corp. colleagues — including Murdoch’s son James, a top executive in his father’s company — frequently attributed information to “JH,” Michel said that was shorthand for Hunt’s office, not for the minister personally.

Michel also admitted that some of the more provocative material in his emails was his own interpretation or, in at least one case, a “very bad joke.”

Asked if he thought Smith accurately reflected Hunt’s view, Michel said: “I would have to assume that special advisers, and there are not many around the secretary of state — there were two in that case — always represent the view of their boss.”

“There (were) two or three events where I probably had the impression that some of the feedback I was being given had been discussed with the secretary of state before it was given to me,” Michel added.

Michel said News Corp. had two formal meetings with Hunt about the bid, and the lobbyist also exchanged some text messages with Hunt.

“I don’t think anything inappropriate ever took place,” Michel said.

“I was never of the opinion that it was inappropriate to at least try to put the arguments to or make representations to these officers,” Michel said at another point.

Under questioning by Robert Jay, the senior lawyer for the inquiry, Michel said his emails did not always accurately reflect his discussions with Smith.

Jay cited one message that Michel sent to Hunt in September 2010 asking about reports that another minister who was then in charge of the bid intended to delay a decision. “Don’t know anything,” Hunt said in a text message.

Michel then reported to his colleagues: “Jeremy Hunt is not aware and thinks it is not credible at all.”

In an email to News Corp. colleagues on Jan. 24, 2011, Michel excitedly relayed details of a statement Hunt would make the next day: “Managed to get some infos on the plans for tomorrow (although absolutely illegal…(at)!)”

On Thursday, Michel said that was a “very bad joke.”

“I have since learned that it is not unusual to get pre-notification for a statement in Parliament to be given to some of the parties to the transaction,” Michel said.

Brooks was editor of the News of the World tabloid between 2000 and 2003, including the time when the paper’s employees allegedly hacked into the telephone of 13-year-old murder victim Milly Dowler when police were searching for her. That has raised allegations of interfering in a police investigation.

That allegation last week provoked outrage far beyond previous revelations of snooping on celebrities, politicians and top athletes, and knocked billions off the value of News Corp. In quick succession, Murdoch closed the 168-year-old News of the World and abandoned his multibillion-pound attempt to take full control of the lucrative British Sky Broadcasting, while Prime Minister David Cameron appointed a judge to conduct a sweeping inquiry into criminal activity at the paper and in the British media.

Brooks said the debate over her position as CEO of News International was now too much of a distraction for parent company News Corp. and she would concentrate on refuting allegations in the scandal.

“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,” Brooks said in an email Friday to colleagues that was released by News International. “This is now detracting attention from all our honest endeavors to fix the problems of the past.”

Tom Mockridge, chief executive of News Corp.’s Sky Italia television unit, was appointed to succeed Brooks immediately. Mockridge began his career at a paper in New Zealand and then served as a spokesman for the Australian government before joining News Corp. in 1991.

News Corp. also announced Friday it would run advertisements in all of Britain’s national papers this week to “apologize to the nation for what has happened.”

“We will follow this up in the future with communications about the actions we have taken to address the wrongdoing that occurred,” said James Murdoch, who heads the international operations of the New York-based News Corp. and has been considered to be his father’s heir apparent.

He said News Corp. had set up an independent Management & Standards Committee to establish and enforce clear standards of operation.

That was an abrupt shift in tone from Rupert Murdoch’s comments Thursday to The Wall Street Journal — one of his own papers — saying that News Corp. management had handled the crisis “extremely well in every way possible” with just a few “minor mistakes.”

Brooks has been in charge of News International’s four British newspapers since 2007, following a four-year stint as editor of the market-leading daily tabloid, The Sun. Just a week ago, she faced 200 angry employees of News of the World who had lost their jobs when Murdoch shut down the paper amid the scandal.

The news of her resignation was greeted with relief.

“It is right that Rebekah Brooks has finally taken responsibility for the terrible events that happened on her watch, like the hacking of Milly Dowler’s phone,” said opposition Labour Party leader Ed Miliband, who had been demanding that she quit. “No one in this country should exercise power without responsibility.”

“(It is) the right decision,” said Steve Field, a spokesman for Cameron who had also called for Brooks to resign.

Brooks agreed Thursday to answer questions next week from a U.K. parliamentary committee. Rupert and James Murdoch initially resisted, but also agreed to appear after the committee raised the stakes by issuing formal summonses.

Police have arrested seven people in their investigation of phone hacking, and two others in a parallel investigation of alleged bribery of police officers for information.

Appearing before another parliamentary committee in 2003, Brooks had been asked whether News of the World or The Sun had ever paid police for information.

“We have paid the police for information in the past,” she said.

Asked if she would do it again, she said: “It depends.”

Andy Coulson, then the editor of News of the World who was arrested last week in the hacking investigation, interrupted to say: “We operate within the (press) code and within the law and if there is a clear public interest then we will.”

In an example of the cozy ties between the British press and politicians, Coulson was Cameron’s communications chief before resigning in January.

Murdoch flew into London last weekend to take charge of the response to the mushrooming phone scandal. Asked by reporters what his priority was, Murdoch gestured to Brooks and said, “This one.”

In her statement Friday, Brooks thanked the Murdochs for their support.

“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,” she said.

James Murdoch praised Brooks as “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,” he said.

On Thursday, police arrested Neil Wallis, former deputy editor and then executive editor of News of the World, in the investigation of phone hacking.

In the United States, meanwhile, the Federal Bureau of Investigation opened an investigation into claims that News Corp. journalists may have sought to hack into the phones of Sept. 11 victims in its quest for sensational scoops.

The U.K. investigation of phone hacking appears still to be at an early stage. Police say they have recovered a list of 3,700 names — regarded as potential victims — but so far had been in touch with fewer than 200 people.

While largely still on the defensive, another one of Murdoch’s British papers, The Sun tabloid, scored one point Friday against former Prime Minister Gordon Brown, who had accused the paper of obtaining confidential medical files on his younger son, who has cystic fibrosis.

The Sun had vigorously rebutted the claim, saying it got its information from another parent, so far unidentified, allegedly motivated by a hope of raising awareness of the disease.

On Friday, The Guardian newspaper apologized for accepting Brown’s version of events.

“Articles in the Guardian of Tuesday 12 July incorrectly reported that the Sun newspaper had obtained information on the medical condition of Gordon Brown’s son from his medical records,” the newspaper said in its corrections column. “In fact, the information came from a different source and the Guardian apologizes for its error.”

Rupert Murdoch said he would appear before a separate inquiry initiated by Prime Minister David Cameron and led by a judge, and was willing to discuss alternative ways of providing evidence to parliament.

News International chief Rebekah Brooks, a British citizen, said that she would appear Tuesday, chairman John Whittingdale said.

He said he especially wanted to question James Murdoch.

“He has stated that parliament has been misled by people in his employment,” Whittingdale said. “We felt that to wait until August was unjustifiable.”

Meanwhile, the criminal investigation into the Murdoch empire widenened as the former deputy editor of the News of the World was arrested by detectives probing phone hacking at the defunct tabloid.

Metropolitan Police said Neil Wallis, deputy editor under Andy Coulson from 2003 to 2007, was arrested on suspicion of conspiring to intercept communications.

Police have so far arrested seven people for questioning in their investigation of phone hacking and two others in a separate investigation of alleged bribery of police officers. No one has been charged.

Coulson, Cameron’s communications director from 2007 until January this year, was arrested on July 8.

Deputy Prime Minister Nick Clegg said Murdoch had big questions to answer about the accusations of eavesdropping and police bribery at his British papers, which have forced the media titan to drop his bid to take full control of British Sky Broadcasting.

“If they have any shred of sense of responsibility or accountability for their position of power, then they should come and explain themselves before a select committee,” Clegg said in an interview with BBC radio.

Brooks was editor of News of the World in 2002 at the time of the most damaging allegation so far, that the paper hacked into the phone of teenage murder victim Milly Dowler in 2002 and may have impeded a police investigation into the 13-year-old’s disappearance.

Brooks has said she was unaware of any phone hacking at the time.

Murdoch’s hope of making BSkyB a wholly owned part of his News Corp. empire collapsed on Wednesday in the face of what Cameron called a “firestorm” that has engulfed media, police and politicians.

Cameron has appointed a judge for a wide-ranging inquiry into the News of the World scandal and wider issues of media regulation, the relationship between politicians and media and the possibility that illegal practices are more widely employed in the industry.

“It clearly goes beyond News International,” Clegg said.

“It is clearly something much more systemic,” Clegg said. “I don’t think we should allow ourselves to believe that it is just because of the Murdochs, or Rebekah Brooks, or it’s all about one commercial transaction, however significant.”

Shares in BSkyB opened higher in London on Thursday but retreated toward noon to trade down 0.6 percent at 701.5 pence ($11.30). The shares closed higher on Wednesday for the first time since they began falling sharply last week amid fresh phone hacking allegations.

Jill Lawless and Raphael Satter in London contributed to this report.

“There is a firestorm, if you like, that is engulfing parts of the media, parts of the police, and indeed our political system’s ability to respond,” Cameron said in the House of Commons. He said the focus must now be on the victims, and make sure that the guilty are prosecuted.

The Daily Mirror newspaper had claimed that some journalists had approached a private investigator in the U.S. to try to access the phone data of some of the victims of 9/11. Cameron told lawmakers Wednesday that he will look into the claims.

In an about-face, Cameron has put his party’s weight behind an opposition Labour Party motion up for a vote Wednesday that declares that Murdoch’s News Corp.’s bid for full control of British Sky Broadcasting would not be in the national interest.

The motion doesn’t carry legal force, but with the three main parties in support, it looms as a powerful expression of the tide running against Murdoch’s newspapers.

Murdoch’s hope to gain control of the 61 percent of BSkyB shares that his News Corp. doesn’t yet own has already been delayed for several months while the British government’s Competition Commission reviews monopoly concerns.

The uproar also claimed another top executive his job. News International, Murdoch’s British unit, said its legal manager, Tom Crone, has left the company, but spokeswoman Daisy Dunlop declined to say if Crone had resigned or been told to leave.

But a defiant mood was evident at one News International paper, The Sun tabloid, which slapped the headline “Brown Wrong” across its front page in response to claims by former Prime Minister Gordon Brown that the paper had obtained confidential medical records of his younger son.

Outrage has grown and Murdoch’s News Corp.’s share price has fallen since a report last week that The News of the World hacked the phone of teenage murder victim Milly Dowler in 2002, followed by claims of intrusion into private records by The Sun and The Sunday Times.

Murdoch has already shut down the 168-year-old News of the World and has come to London to direct the company’s efforts to get on top of its problems.

A report Wednesday in The Wall Street Journal, which is part of News Corp., said that Murdoch has met with advisers over recent weeks to discuss possible options including the sale of the remaining British newspapers — The Sun, The Times and The Sunday Times.

The Journal, citing unidentified people familiar with the situation, said there didn’t appear to be any buyers given the poor economics of the newspaper division.

Brown accused Murdoch’s papers, including The Sun and The Sunday Times, of obtaining his confidential bank accounts, tax records and even health information about his son, Fraser, who suffers from cystic fibrosis, using fraudulent, criminal means. But, the newspaper insisted it learned of the boy’s ailment from the father of another child with the same condition, and that it contacted the Browns, who consented to the story.

“We are not aware of Mr. Brown, nor any of his colleagues to whom we spoke, making any complaint about it at the time,” The Sun said.

Its coverage included picture of Brown and Murdoch standing together, both grinning.

Murdoch’s News International responded to his accusations by asking Brown for any information that would help to investigate them.

London Mayor Boris Johnson said Wednesday that he had been informed that his telephone had been hacked, but he decided not to take legal action.

“Quite frankly, why on earth should I go through some court case in which it would have inevitably involved going over all the pathetic so-called revelations that the News of the World had dug up?” Johnson said.

“Why should I, when the police had made it clear to me when they had abundant evidence?” he added.

In Washington, Sen. Jay Rockefeller, a Democrat from West Virginia, urged an investigation into whether Murdoch’s U.K. newspapers had violated U.S. law.

If there was any hacking of phones belonging to 9/11 victims or other Americans, “the consequences will be severe,” said Rockefeller, chairman of the Senate Committee on Commerce, Science and Transportation.

The suggestion that 9/11 victims may have been were targeted surfaced Monday in the Mirror, a British competitor of The Sun. It quoted an anonymous source as saying an unidentified American investigator had rejected approaches from unidentified journalists who showed a particular interest in British victims.

Cameron promised that the claim would be investigated.

Police in the U.K. are pursuing two investigations of News International, one on phone hacking and the other on allegations that the News of the World bribed police officers for information.

Hugh Orde, president of the Association of Chief Police Officers, urged News International to come clean about any such payments.

“Let’s not play around with legal games here: If they have names, dates, times, places, payments to officers, we would like to see them so that we can lock these officers up and throw away the key,” Orde told the British Broadcasting radio.

Police officials have indicated the bribery investigations involve about half a dozen officers.