Rupert Murdoch

‘The Man Who Owns the News’
By MICHAEL WOLFF


Prologue

HIS MESSAGE
FALL 2007-WINTER 2008

Rupert Murdoch, a man without discernible hubris — or at least conventional grandiosity — had nevertheless begun to believe that his takeover of Dow Jones and the Wall Street Journal, something he'd dreamt about for most of his career, might actually indicate that he and his company, News Corporation, had a certain destiny, a higher purpose of which the world should be made aware.

He'd started to think that his triumph in the quest for Dow Jones was an opportunity to rebrand — the kind of marketing frippery he usually disdained. He was even toying with the idea of changing the name of News Corp., that oddly boring, genericsounding throwback to the company's earliest days — his first paper in Adelaide, Australia, was the News — to something that could better indicate his and News Corp.'s philosophical reason for being.

What that reason for being exactly was ... well, um ... that was still hard to actually put into words. But it had something to do with ... well, look at these:

He had mock-ups of full-page ads that, he was thinking, should run in all the Wall Street Journal's competitors — particularly the New York Times and the Financial Times — on the day he took over the paper.

One of the ads had the big headline "Agent Provocateur." Another pursued the idea of pirates — the notion being that for more than fifty years the company had been ... well, if not exactly outlaws ... not literally, still ...

When, after many hours of conversation with Murdoch, I despaired of ever getting an introspective word out of him, his son-in-law Matthew Freud, the PR man from London, advised me to ask him about "being a change agent."

This conversational gambit prompted Murdoch's enthusiastic unfurling of these ads and eager, if far from concrete, ideas — "We're change agents," he kept repeating, as though new to the notion — about the meaning of News Corp. and, by extension, himself. It also prompted dubious looks from some of the executives closest to him. Murdoch's sudden search for an ennobling and guiding idea was a vexation not just because it called attention to exactly what News Corp. executives often despaired of — that image of runamok ruthlessness that the battle for Dow Jones had stirred up all over again — but also because it was distinctly out of character.

Soul-searching wasn't, to say the least, a part of the News Corp. culture. So it was curious, and unsettling, to have the veritable soul of the company trying to figure out why he'd gotten where he'd gotten, and for what good reason.

Such a statement about his fundamental righteousness (and even, perhaps, relative coolness) was, significantly, being urged on him by his son James, a Harvard dropout who had started a music label and then spearheaded News Corp.'s new-media initiatives in the 1990s, and who had become the CEO of British Sky Broadcasting (BSkyB), the News Corp.-controlled company that operates the Sky satellite TV network in the United Kingdom. Not long before, Murdoch had favored his older son, Lachlan, and before that his daughter Elisabeth, to eventually run News Corp. But now it was James. In fact, unbeknownst to the rest of News Corp., James was about to be given responsibility for the U.K., Europe, and Asia by his father — who wanted to spend more of his time at the Wall Street Journal and, in addition, wanted to use the opportunity to put James in reach of the top spot in the company (without having to actually turn over the top spot).

James had been, much more so than his father, particularly aggravated by the terrible press heaped on his dad and on the company because of the Dow Jones bid. Alternately aggressive and defensive, James was looking for a way to fight back. In fact, it was not entirely clear that the father's sudden enthusiasm for brand development wasn't about pleasing his son, clearly the apple of his eye at this moment. (He was very excited about showing off BSkyB's annual report, for which his son was responsible and which he thought was the kind of thing they could be doing at News Corp. — every employee, he said, as though new to the novelty of an expensively produced annual report, could get one!) There was enough triumphalism around News Corp. to please everybody.

Gary Ginsberg, News Corp.'s executive vice president for global marketing and corporate affairs and one of the executives most frequently attending Murdoch, while worried about the particular branding initiative of the ads, had his own brand idea that he was pushing. He had, of late, vastly expanded his portfolio beyond just being the company's PR guy to include, among other things, big-concept brand-awareness thinking. In this role, he was helping spearhead the bid News Corp. was making with the Related Companies, a major Manhattan real estate developer, for the rights to build a massive complex (larger than Rockefeller Center) on the biggest undeveloped piece of land in Manhattan. News Corp., with its naming rights to News Corp. Center (unless they changed the name of the whole company), would become the anchor and one of the main brand names of midtown.

In light of the fact that Rupert Murdoch now owned the most important — all right, the second most important — newspaper in the world, not to mention having created the world's most successful media company and being quite possibly the most influential businessman of the age (certainly the most influential for the longest time), why wouldn't he want to figure out just how he'd done what he did and claim credit for it? (Of course, another reasonable view, one that Murdoch — for so long a deal-a-minute guy — also seemed to subscribe to, was about how little meaning or calculated direction or vision there had been in the growth of News Corp. But no matter.)

Murdoch was, frankly, impressed with himself. Delighted. Giddy. He couldn't believe how exhausted he felt once the deal was done. He'd held his anticipation and excitement "all inside," and as soon as he could relax, he felt "wiped out." Perhaps more than any other accomplishment, getting the Wall Street Journal was, in and of itself, the big one, and not just a next step toward something else.

And there was the other stuff. Legacy stuff. There were his two young children — Grace, six, and her sister Chloe, four — and how they would think of him in, well ... the future. There were his older children and the importance of defining the meaning of the company he would be leaving them. That was James' point. That was also what he was always hearing from Matthew Freud, the Svengali-ish marketer, who was now married to the family. Brand was legacy. The bigger the brand message, the bigger the legacy.

Plus there was Murdoch's wife, Wendi, thirty-nine. Her energy, her sense of possibilities, her urge to take over the world, to leave her mark, might be as great as his own. Perhaps they were competing.

Not to mention that at nearly seventy-seven, even a man without hubris should get a chance to make a statement. If not now, when?

On the other hand, it also seemed a potentially great mistake to attribute too much sentiment or craving for positive recognition to his motivations.

For one thing, the branding statements toward which Murdoch seemed to gravitate were not so much about News Corp.'s greatness or vision as they were about kicking dirt in people's faces. His true message about his acquisition of the Wall Street Journal was that he was the winner.

A month or so after the Bancroft family voted to sell him their great-great-grandfather's company, Murdoch invited the Journal's fifteen top editors to lunch at the Ritz-Carlton downtown and brought along as the featured guest Col Allan, the profane, harddrinking and foul-tempered editor of the New York Post. (Not too long after the sale went through, Allan was dressing down a subordinate so heatedly that he slammed his hand on the desk and cracked his cuff link — a gift from the police commissioner.) In journalistic terms, Allan might be as different from a Wall Street Journal editor as, say, a pit bull from a spaniel. Allan's very presence at the lunch announced that the Wall Street Journal had been taken over by News Corp. (Not to mention that it was just delightfully evil of ol' Rupe to bring ol' Col along to scare the bejesus out of his new charges.)

Murdoch's march into the Wall Street Journal newsroom with his two lieutenants — loyal Les Hinton, who ran News Corp.'s U.K. operation and who would be coming to run the Dow Jones business, and inscrutable Robert Thomson, the London Times editor, who would be taking over the Journal's newsroom — was not the arrival of someone who wanted his great purpose and historic destiny to be roundly applauded. Rather, with the back of his hand, he let it be known that the Wall Street Journal was his most recently conquered nation — the staff at the Journal, many of whom were soon to be displaced persons, were merely history's flotsam and jetsam. They were the impediments to change. He was the change agent. "We might," he said one afternoon as he considered his new conquest, "have to let people go just to make a point." He summarily replaced Dow Jones' top executive, Richard Zannino, and the Journal's publisher, L. Gordon Crovitz. He was purposely brutal with the sitting editor, Marcus Brauchli — who was, in theory, protected by the editorial agreement Murdoch had entered into with the Bancroft family in order to buy the paper. Doing an easy end run around the agreement that precluded him from unilaterally firing the existing editor, Murdoch had brought in his own editor of choice, Thomson, an Australian, and called him the publisher. The News Corp. people were bemused that people didn't immediately understand that Thomson's arrival as publisher was a demotion of Brauchli. The News Corp. people did not even let Brauchli speak at Murdoch's first meeting with the entire newsroom.

"Doesn't he understand it's our paper now?" said one of the executives closest to Murdoch, smacking his head. And if publicly disregarding (and dissing) Brauchli didn't make the point, "the fact that Rupert will stop speaking to him will," the executive chuckled. Although Murdoch offered some begrudging words about working together when he spoke to the staff, what he actually meant, News Corp. people were explaining, was that if you had a problem, leave. There was work to do, a paper to put out. A Murdoch paper.

For many journalists, hatred of Murdoch had come to define the profession. As the Dow Jones takeover progressed, both Bill Keller, the executive editor of the New York Times, and his boss, Arthur Sulzberger Jr., the paper's publisher, were busy characterizing Murdoch in cocktail party conversations as the worst thing that had ever happened to journalism. That's how Keller earlier confronted Ginsberg: "How can you work for the Antichrist?" The New York Times more and more defined itself as "not a Murdoch paper."

That characterization paralleled how Murdoch defined the profession too: there were the elites, whose contempt for him encouraged him to regard them as all the more contemptible, and there were those who worked for him, who were, necessarily, true believers in him.

Of note, the journalists most unhappy about Murdoch taking over the Wall Street Journal were often unhappy themselves. Unhappy because their jobs were insecure — the Journal, itself, had had waves of layoffs — their influence waning, workload increasing, and paychecks going down, indeed unhappy always knowing that they had to worry about Murdoch taking over. The people who worked for Murdoch were, arguably, among the happier people in the media business. As a newsman at News Corp., your influence increased rather than dimmed. Both Fox News and the New York Post took a manic delight in their influence. And Murdoch himself was fiercely loyal — even if you talked dirty to underlings, as the Fox News commentator Bill O'Reilly had, or took money from sources, as New York Post "Page Six" editor Richard Johnson had.

Murdoch's intention, which he began to announce everywhere with something like a sadistic glint, was to use the Wall Street Journal to go to war against the New York Times, not least of all because the Times was ground zero for the journalists who held him in contempt.

He'd acquired one of the two best papers in the world — which every journalist who didn't work for him assumed he would ruin — in order to destroy the other. It was a kind of personal revenge as well as, possibly, a viable business strategy.

It would be a true, and perhaps final, newspaper war.

(Continues...)