Rupert Murdoch is without question the best known media tycoon since William Randolph Hearst. Like him or loathe him, his News Corporation single-handedly defined the nature of the modern media corporation between 1975 and 2010. No other group has come close to emulating its combination of broad-ranging assets and ground-breaking technology and strategy. And while other groups have been forged by many hands, News Corporation is very much the result of one man's personal vision. Yet the phone hacking scandal at his British newspaper division, which reached a crescendo in summer 2011 and threatened to spread contagion to other parts of the group, created the biggest threat to-date to the Murdoch empire. Partly as a result of these problems, Murdoch separate the global publishing business into a separate entity from July 2013. This took on the name News Corporation, while the old parent company now trades as 21st Century Fox. Murdoch turned 85 in 2016, yet he still maintains direct personal control over all aspects of his wide-ranging empire, even if day-to-day responsibility is now delegated to his sons.
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|Wall Street Journal||New York Post|
|The Times||Fox Sports Australia|
|Times Literary Supplement||Herald Sun|
|News America Marketing|
Adbrands Weekly Update 16th Aug 2018: Net losses at Murdoch-controlled News Corporation more than doubled in the year to June 2018 to $1.4bn as a result of impairments and costs associated with the merger of Australian pay-TV channels Fox Sports and Foxtel and also against US-based marketing arm News America. Revenues rose 11% to $9.0bn, with almost half the uplift coming from newly consolidated Foxtel. The group's star performer was once again the digital real estate division, comprising Realtor.com and Move.com in the US and RealEstate.com.au in Australia. Its revenues soared 22% to $1.1bn, and operating profits jumped 24% to $401m, accounting for around 40% of group profits. Revenues in the core newspaper division edged up just 1% to $5.1bn but operating income slipped 5%.
Adbrands Weekly Update 24th Jun 2018: Cannes Lions 2018: And so Cannes Lions 2018 draws to a close. Two separate campaigns won different Grand Prix with a similar theme of recreating a lost voice. The Grand Prix for Creative Data went to Irish agency Rothco for 'JFK Unsilenced', a campaign for the Irish edition of News Corporation's The Times newspaper. On the day John F Kennedy was assassinated, he was on his way to the Dallas Trade Mart to deliver a speech. The speech was already written but he died before he could deliver it. Rothco used vocal extracts from 831 other speeches delivered by JFK to recreate the one he never gave, spoken in his own voice. A similar concept lay behind Australian agency BWM Dentsu's 'Project Revoice' campaign for The ALS Association. ALS sufferer Pat Quinn helped to launch the ALS Ice Bucket Challenge - a huge viral triumph four years ago - while himself suffering from the early stages of the disease. He is no longer able to speak, so BWM Dentsu pioneered a technique for cloning and rebuilding his voice so that he can communicate naturally with his carers; the same technique can now be deployed for other sufferer of the disease. This was the worthy winner of the Grand Prix for Good.
Adbrands Weekly Update 17th May 2018: News Corp's results for 3Q were dented by a mammoth write-off against its broadcast operations in Australia following the acquisition of a controlling stake in local satellite broadcaster Foxtel. The merger of Foxtel with the group's existing Fox Sports business prompted a near $1bn impairment. A separate write-off against its US-based News America Marketing flyers and coupons division resulted in a net loss for the quarter of $1.1bn. After a pretty dismal break-even for the first half of the financial year, net loss for the nine months to-date is also $1.1bn. Performance across almost the entire group has been lacklustre, with only digital real estate - Realtor.com and similar services - showing signs of strong growth. For the year to-date that division accounted for just 13% of revenues, but almost 40% of operating profit.
Adbrands Weekly Update 1st Mar 2018: Ads of the Week: "Are You Gonna Bingo?". The & Partnership gets down *wiv da kidz* (sort of) in this insane spot for Sun Bingo, the gambling game from News Corp's tabloid champion The Sun. Let's be honest: it's the kind of ad we really ought to hate... but actually we can't resist its chavvy, innocent, and thoroughly British charm. We watched the ad a week ago and we still can't get that tune out of our heads. (With a big debt to Funky Dee's 2010 UK grime classic 'Are You Gonna Bang Doe?') And what a massive star turn for Jayde Adams, Bristol's answer to Rebel Wilson, suddenly offered her own national platform.
Adbrands Weekly Update 25th Jan 2018: In what is being billed as a major victory for News Corporation in the UK, its flagship quality newspaper The Times has overtaken long-time rival The Telegraph in print circulation for the first time. Despite steady declines across the industry as a whole over the past couple of years, The Times has slowly but steadily increased its circulation. Latest ABC figures for December registered a 1% increase to 446,204 copies per day, while The Daily Telegraph reported a 14% slump to 393,310 copies. However, The Telegraph was quick to fire back, pointing out that the Times has only achieved that level because its circulation includes around 100,000 copies distributed for free to airlines, hotels and other partners for the benefit of their customers. The Telegraph has cut back its own bulk supplies, but in terms of newstrade paid circulation, it still leads with 384,807 copies to the Times' 344,937.
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Free for all users | see full profile for current activities: Australian-born and Oxford-educated, Rupert Murdoch inherited two newspapers in 1952 after the death of his father, who had been the much respected editor of the Melbourne Herald, a far-flung component of the British-based Northcliffe Newspapers group (now part of DMGT). Privately, Sir Keith Murdoch also held a controlling interest in the Queensland Newspaper Company, publishers of the Adelaide News and Sunday News. It was this regional business which the 22-year-old Rupert Murdoch, then a trainee journalist on London's Daily Express, took on. Not content with print alone, by 1960 he had secured the license for Adelaide's Channel Nine television station, and used the profits from this increasingly successful operation to move into the mainstream, acquiring Sydney's Daily and Sunday Mirror. In 1964, he launched The Australian, that country's first national newspaper. By 1968, Murdoch's empire down under was worth over $50m, with a broad range of newspaper, television and magazine interests. It was time to venture overseas.
In 1968, the News of the World, Britain's best-selling popular Sunday paper, came to the market. After a bruising takeover battle against rival bidder Robert Maxwell, Murdoch captured the prize. Just a year later, he trumped Maxwell again, buying failing popular daily The Sun from IPC for just £50,000. The two papers became the engine for a new empire. Murdoch made The Sun more sensational, introducing topless models on page three of every issue. That feature alone probably led to the paper's rise in circulation from 800,000 to over 3m by 1972. The profits generated by the paper allowed Murdoch not only to add additional Australian newspapers to his portfolio, but take a controlling 40% stake in London Weekend Television, the then-struggling weekend broadcaster for the capital city.
Meanwhile, Murdoch began to turn his attentions to the US. In 1973 he acquired the San-Antonio Express and News for $19m, and launched a daily tabloid, the Star. In 1976 The New York Post became the 84th newspaper in the group's portfolio. To counter his reputation for downmarket sensationalism, Murdoch turned his attentions to more traditional newspapers. In 1976 he narrowly missed the chance to buy the UK's oldest upmarket Sunday paper, The Observer. But he achieved his goal five years later, capturing the even more prestigious Times and Sunday Times newspapers when Thomson put its loss-making portfolio up for sale.
But America was playing an increasingly important part in Murdoch's strategy, and so was television. The same formula which had achieved success in Australia and the UK was put into practice in the US. Murdoch used his newspaper properties as a springboard into cable, television and cinema. In 1983, the Chicago Sun-Times was his biggest acquisition to-date, costing $100m (but sold three years later). Following that, his first steps into broadcast were unproductive. A majority stake in satellite broadcast trial Skyband came to nothing, and his attempt to acquire Warner Communications (a predecessor of Time Warner) was also unsuccessful, though he briefly became its biggest shareholder. But the second half of the decade saw a series of triumphs. In 1985, he pulled off the $575m acquisition of 20th Century Fox, one of the biggest Hollywood studios, as well as a package of upmarket travel and lifestyle magazines from Ziff-Davis. A year later, he became a US citizen in order to acquire Metromedia, the country's leading group of independent TV stations.
Also in 1986, Murdoch moved his UK newspaper properties to a new high tech facility in east London, leading to an all-out battle with the all-powerful British printing unions. After a long and bitter fight, backed by Margaret Thatcher's government, Murdoch was victorious and the power of the union was destroyed. The move saved Murdoch around £60m a year in costs, pushing Times Newspapers into profit for the first time in years. In 1987, News Corp acquired the Australian Herald and Weekly Times group, giving Murdoch control of over half of his home country's daily newspaper circulation. He also bought out British book publisher Collins (having taken a 40% stake in 1981) and US publisher Harper & Row, combining the two as HarperCollins. Then came the 1988 acquisition of Triangle for what was then a staggering $2.85bn. This US magazine group owned a portfolio of leading titles including the #1 magazine, TV Guide. The following year, the group launched Sky Television in the UK, the world's first satellite broadcasting company (see BSkyB profile for more).
All of Murdoch's moves during the second half of the 1980s entailed not only huge risk, but also substantial levels of bank debt. As interest rates rose and the economy moved into recession, News Corporation began to pay the price. One of the most expensive risks was Sky, which took much longer than hoped to reach financial mass. Forced to restructure to save the group from its debt burden, Murdoch sold off many of his smaller publishing interests. One victim was the sizeable magazine portfolio, grouped as Murdoch Magazines. By the end of the 1980s this included the likes of Elle (in the UK), Mirabella, New Woman, Premiere and other leading titles. The majority of the US titles were sold to K-III in 1990, the British ones to EMAP. The Australian portfolio was sold to Matt Handbury, Rupert Murdoch's nephew, but continued to trade under the Murdoch Magazines name.
In 1993, NewsCorp took control of Hong Kong-based Star TV, a satellite channel ultimately capable of reaching the vast Chinese audience. By 1995, Murdoch was fully back on course again. In 1996, he launched Fox News, a cable news channel designed to compete against CNN. He followed this with the acquisition of direct marketing company Heritage Media for $1.3bn, and Pat Robertson's cable TV company International Family Entertainment for $1.9bn. Murdoch's main interest in Heritage was its Actmedia subsidiary (now News America) which produced in-store marketing and advertising coupons for 40,000 supermarkets, drug stores and mass-merchandise outlets across the US.
In 1999, the group began a complicated restructuring of its relationship with Liberty Media, the pay-TV arm of cable operator TCI, which had been acquired by AT&T a year earlier. Liberty had been News Corp's partner in Fox/Liberty Networks, the cable company which owned US channels Fox Sports Net, FX and others. NewsCorp bought out Liberty's 50% interest in Fox/Liberty Networks, in return for a stake in News Corp itself. At the same time, Murdoch sold his valuable TV Guide magazine group to publicly owned United Video Satellite Group, one of the country's leading cable operators, formerly controlled by Liberty. Restructured as TV Guide Inc, News Corporation and Liberty kept a 44% stake in the operation, until the company was then merged with cable and TV technology business Gemstar. News Corp ended up with a 21% stake in TV Guide-Gemstar. This increased to 38% after a series of share swaps in 2000 and 2001, through which Liberty took an 18% stake in News Corp.
However, as the internet economy exploded in 1999 and 2000, critics began to snipe at the group, claiming it had lost the head start it gained in the 1980s and early 1990s. At the time, financial markets and media pundits alike were convinced that TV broadcasting would be overtaken by the new medium of the internet. Although Murdoch had been the first to launch a successful satellite television service, he had struggled to transfer his power in the UK to other countries. US service ASkyB was slow to launch, with the result that competitor DirecTV took the lead, and Murdoch was eventually forced to sell his own service to smaller rival Echostar. Similarly Japan's JSkyB was swallowed up by SkyPerfecTV!
Despite some early dabbling, the group had steered clear of new media after a disastrous early failure in the UK. News Corporation had acquired community ISP Delphi Internet Services in 1993 for around $12m. But Delphi was ahead of its time, and Murdoch sold the business in 1996 after racking up huge losses. The following year, News Corp came close to acquiring online news channel Pointcast, only to watch as that business also failed. As a result, the group became far more cautious than other media groups with regard to the internet. At the time this led to much criticism, but ultimately the group was proved right in its scepticism. News Corp made its biggest investment in internet businesses by purchasing a 10% stake in online health network Healtheon WebMD for around $1bn, mostly in stock and advertising space, and merged its Health Network cable channel into it. When the internet boom came crashing to a halt, News ended the partnership, regaining control of the Health Network.
There were other financial problems in 2000 and 2001. During 1999, Lachlan Murdoch, then running the group's Australian operations, had invested £125m to acquire a 25% stake in One.Tel, an Australian company offering low-cost international telephone calls. The business went bust in 2000, and News Corp was left with a percentage of the company's substantial losses. These deals proved an irritating distraction from Rupert Murdoch's main project in 2000 and 2001. With retirement on the horizon, he began assembling a final show-stopping deal that would crown his career. The group announced plans to consolidate all its satellite TV interests in a single, separately quoted business, Sky Global Networks, which would be floated in the biggest ever media IPO. The new company would group together all News Corp's holdings in satellite broadcasters across the UK and Europe, Asia and Latin America. However it lacked a presence in the world's biggest market, the US. News Corp opened negotiations late in 2000 to acquire DirecTV, the satellite broadcaster owned by General Motors subsidiary Hughes. However talks proceeded slowly, and in 2001 Hughes announced a deal to sell its business to rival Echostar instead. In a remarkable stroke of fortune for Murdoch, that deal was later blocked by US regulators, allowing News Corp to acquire control of the business on the rebound in 2003.
In a surprise announcement in 2005, Rupert Murdoch's eldest son Lachlan announced his resignation as deputy COO of the group. Previously regarded as his father's likely successor, he is reported to have felt that his position within the group was being undermined by Murdoch senior's continuing hands-on involvement with day-to-day business. This friction is thought to have been heightened by growing tension between Murdoch and his adult children over their inheritance. Until recently, the controlling stake in News Corp was to have been split after Rupert Murdoch's death by his four grown-up children. However Murdoch is now thought to have told his family that his two infant children by third wife Wendi Deng will also receive equal shares in the controlling trust.
Despite Rupert Murdoch often-stated commitment to newspaper publishing, the group finally began to consider plans to spin off its print division as a separate entity in summer 2012. Such a move had long been canvassed by shareholders, to remove the drag effect on News Corp's more profitable entertainment assets. The UK hacking scandal made that strategy even more appealing. The group will now spin off its global publishing businesses into a separate publicly quoted entity during the first half of 2013, although still under the control of the Murdoch family. The spun-off company - which will retain the News Corporation name - will also take charge of the current group's other interests in Australia, including Foxtel and Fox Sports. See full profile for current activities
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