Some News Corp shareholders are privately furious about Mr Murdoch’s willingness to pay such a high price for what they see as “the media equivalent of a trophy wife”, notes the Economist in its latest issue. But is there more to Rupert Murdoch’s $5bn bid for Dow Jones than an old man’s vanity, the magazine asks, raising the thought that others dare not mention: that Mr Murdoch, at 76, is starting to show his age.
But his friends contend that the media tycoon has always been prone to rambling sentences and repetition. If there is an occasional lack of clarity in his explanation of News Corp’s strategy, particularly its embrace of new media through acquisitions such as MySpace, there can be no doubting the excellence of that strategy in practice.
Mr Murdoch’s recent behaviour shouts that he is still the bold, innovative big spender, bent on global media domination, and his $5bn offer for Dow Jones is a case in point says the Economist.
The Bancroft family, which owns a controlling stake through special voting shares, initially rejected Mr Murdoch’s bid. But the younger Bancrofts will soon be in the majority within the family, and are said to be lobbying their elders to swap shares for Mr Murdoch’s cash. (Some 80 per cent of the family’s votes are opposed to his offer, but this represents only 52 per cent of the total votes, so a small number of defections could tip the balance.)
The $5bn question, says the Economist, is: why does Mr Murdoch want Dow Jones? Simple. Mr Murdoch has long dreamt of owning a global business newspaper. In January, his talks with private-equity firms at the World Economic Forum about a joint bid for Pearson, the FT’s owner (and part owner of The Economist), apparently ran out of steam. So it’s Dow Jones or nothing.
Inevitably, given Mr Murdoch’s reputation as a hands-on proprietor, there are fears he would undermine the editorial independence of the Journal’s news coverage, the magazine notes. With staggering faith in the moral compass of market forces, the Economist sanguinely concludes: “But he is certain to understand that excessive interference could tarnish the paper’s brand, the value of which comes from having wealthy readers who value honest journalism”.
On the other hand, if he does want to install a “loyalist” as editor, he has one on hand in Britain, the Economist helpfully suggests: Robert Thomson, editor of the News Corp-owned The Times since leaving the FT after he was passed over for the editorship in 2001.
If the deal goes ahead, it might turn out better than some News Corp shareholders fear. There are some synergies between News Corp and Dow Jones, as well as fairly similar cultures. Mr Murdoch may indeed “get” new media, and may have spotted lucrative opportunities within Dow Jones. If so, and if his bid succeeds, it would not be the first time he has proved his critics wrong.