One of the few nonagenarians who can boast of being in control of a hugely powerful media empire, Australian-born American Rupert Murdoch continues to stand tall, despite having weathered numerous controversies.
Murdoch is the Executive Chairman of News Corp and Co-Chairman of Fox Corporation, two of the biggest names in media. The former boasts of names such as The Wall Street Journal, New York Post, Sun, The Times, and The Australian and publisher Harper Collins, apart from numerous other smaller publications under its belt. Meanwhile, the latter is the broadcaster of American news channel Fox News.
The billionaire media mogul, who is estimated to be worth nearly $24 billion, has managed to make his name synonymous with media, controlling 57 percent of Australia’s newspaper market by circulation in 2011 and a considerable chunk of the world’s media. He may no longer own what he did once, but he has still managed to stay highly relevant.
The Road to Becoming A Media Mogul
Murdoch’s journey into news and media started from an Adelaide newspaper that he inherited from his father, Sir Keith Murdoch, a celebrated war correspondent, who passed away in 1952, leaving his son the small tabloid.
Since then, Murdoch has amassed more media assets, swooping up newspapers and TV channels over the years in Australia. In 1969, he first forayed into the United Kingdom and later purchased The Sun.
News Corporation, the original form of Murdoch’s companies, came into being in 1979, soon after which it purchased the UK newspapers The Times and The Sunday Times, as well as Harper Collins.
Eventually, in 1985, Murdoch acquired the 20th Century Fox movie studio in Los Angeles, the studio responsible for producing award-winning films such as Titanic and Avatar.
Thereafter, in 1986, after gaining US citizenship, Murdoch launched the Fox broadcast network as a subsidiary of the 21st Century Fox media conglomerate, the company behind hits such as The Simpsons, Married… With Children, and eventually Ally McBeal and American Idol.
In October 1996, News Corporation launched the Fox News Channel and also established networks including Fox Sports Network, FX and the National Geographic Channels.
In 2007, Murdoch acquired The Wall Street Journal.
Since the inception of News Corporation in 1979, Murdoch has served as CEO and Chairman, till the company split into two separate entities in 2013 – News Corp and 21st Century Fox. He then took over as Executive Chairman for both, till the dismantling of the latter in March 2019.
The Fox Story
On 20 March 2019, the deal between Disney and 21st Century Fox, which had been in talks since 2017, finally became official. Disney took over assets of the latter such as the 20th Century Fox film and TV studios, an additional 30 percent stake in Hulu, cable channels FX and National Geographic, and Indian media conglomerate Star India, among others.
This $71 billion deal left the company formerly known as 21st Century Fox renamed Fox Corporation. It included the Fox News channel and Fox’s broadcast network. It also left Murdoch richer by $4.3 billion, according to an estimate by Forbes, while Financial Times reported that each of his six children got $2 billion from the deal.
“Are we retreating? Absolutely not. We are pivoting at a pivotal moment,” Murdoch reportedly said at the time of the deal.
He may have lost some power then, since he got no official position at Disney, but he retained many of the important assets, among them the mega-successful Fox News, which in 2016 became America’s most-watched channel in cable television, reported Financial Times.
Golden Goose No More?
Fox News, the right-leaning news network, once a favourite of former US President Donald Trump, rose to dizzying heights during his tenure, with viewership at record highs and profit margins in excess of 50 percent. The channel also gained its share of notoriety during the period for its editorial leaning and the views aired on it, often linked to Trump and other Republicans.
But now, with the Trump era at an end and the Democrats back in power, cracks have emerged in the network often seen as the ‘golden goose’ of the Fox Corporation. For the first time in 20 years, the network is losing the rating war to rivals like CNN and MSNBC, and is also facing competition from other right-leaning competitors like Newsmax or One America News.
Trump is gone from the White House, and there are signs that his exit has taken Fox News’ fortune with it.
Fox News is also facing the fallout of Trump being upset with them since the perceived betrayal over the network’s early projection of US President Joe Biden as the winner in Arizona, as well as the overall winner on 7 November 2020. The relationship between Fox and Trump was a mutually beneficial one, with the channel being the administration’s preferred medium for announcements and interviews. Trump also made sure to heavily publicise the network, tweeting about it often. But he has now been seen promoting the other right-leaning alternatives.
Fox News is also facing a lawsuit over allegations that it spread the theory that the results of the US election were rigged, a view promulgated by the channel’s hosts and guests.
The result? Fox is now reportedly having to make drastic changes internally to manage the slump it saw in January ratings, when it came in at third place for the first time since September 1999, reports Vanity Fair.
Is this a problem for Murdoch? According to The Guardian, it is unlikely to particularly concern Murdoch, who has weathered problems like a phone-hacking scandal over a decade ago that threatened his UK empire.
The India Connect
Somewhere along the way during his acquisitions of media across the world, Murdoch in 1993 bought 64 percent equity of Star TV, an Asian broadcasting business with reach in India and China, from Li Ka-Shing and his son Richard Li for $525 million, reports India Today. This eventually grew to 100 percent ownership of Star TV.
“Over the years, Star brought many things to India: Channel [V], India’s first music channel, in 1994; Star News, its first news channel in 1998; and Radio City, the first private radio station in India in 2001. It also revived an ancient Indian game through the Pro Kabaddi League, and created one of the country’s biggest video streaming apps with Hotstar...,” writes Vanita Kohli-Khandekar in her book The Making of Star India.
According to Business Standard, in August 2009, News Corporation announced that it would break up its Asian satellite broadcasting business – Star TV – creating three entities, namely Star India, Star Greater China, and Fox International Channels.
Murdoch paid great attention to his businesses in India, understanding the importance and reach of media in a rapidly growing economy. Star India's network included 32 channels in eight languages and expanded aggressively all over the country.
Owning Star TV and later Star India gave Murdoch not only political clout but also a formidable reputation in India, with his empire ranging from TV production and broadcasting to films, TV news, cable distribution, DTH services, wireless and digital services.
Murdoch remained the owner of Star India till the company struck a deal with Disney in March 2019, following which its ownership was transferred to Disney.
It's News Corp vs Google & Facebook
Even at the age of 90, Murdoch is still winning historic battles, as was seen in February of this year when tech giant Google struck a deal with News Corp for three years, agreeing to pay the media conglomerate for news on its platform during that period.
Murdoch has been fighting this pitched battle for over a decade now, asking internet platforms to pay media companies for their content, and his win against Google is the envy of many publishers.
News publishers, especially smaller publishers across the world, have seen advertising revenues take a severe hit as digital platforms like Google and Facebook share news content on their platforms, earn revenue and also dictate the availability and reach of news content produced by traditional media houses.
"“This has been a passionate cause for our company for well over a decade and I am gratified that the terms of trade are changing, not just for News Corp, but for every publisher.”" - Robert Thomson, News Corporation chief executive
Yet, while Murdoch tasted victory with Google, Facebook played hardball and blocked out users and news organisations, among others, in Australia from sharing news and other links on their platform. Facebook took the action after the Australian government proposed laws that would require big tech platforms like Facebook and Google to reach commercial agreements and strike revenue deals with news outlets whose content drives traffic on the platforms.
Google and Facebook had been on the same page about not giving in to the demand, up until last year, when the former pledged $1billion over three years to pay global publishers and has said it reached terms with 450 “news partners”.
Why did Facebook not agree and instead decide to restrict news? Perhaps because it accords less importance to news. Facebook has said that “news makes up less than 4 percent of the content people see in their news feed”. For the social media platform, which is essentially a forum for people to come together and share photos, updates and views, news is peripheral as compared to Google.
Facebook's move to ban all Australian news content has now taken the conflict with Murdoch to a new level, with one of his newspapers calling it "an act of war", reports BBC.
The Question of Murdoch's Empire: What Next?
The overarching question about Murdoch’s empire is that of succession. “Who will hold it together except for Rupert?” is a question that is looming large, reports Financial Times.
While his eldest son Lachlan – who struck out by himself in 2005 but returned to the fold a decade later – is the heir apparent, there are reportedly questions about what he wants to do with the company. According to people Financial Times spoke with, Lachlan, who heads Fox Corporation along with his father, may be unwilling to continue running the company, given a long-term decline in popularity of television, and may instead want to focus on digital, such as Tubi, an ad-supported video-streaming platform that he bought for $440 million.
Meanwhile, Lachlan shares a difficult relationship with his younger brother James, who appears to be at odds with the editorial stance held by Fox News and has cut ties with his father’s media empire.
According to The Guardian, speaking about the US Capitol riot, James has lashed out at the US media for “propagating lies” which have unleashed “insidious and uncontrollable forces” that will endure for years. Reportedly, when asked about Fox News’ role in the riot, he said media groups propagated election disinformation, though he did not name the network in itself. Moreover, in August 2020, James had resigned from the board of News Corp, owing to “disagreements” over editorial content.
According to The Guardian, the power of the Murdoch family trust, which controls 40 percent of voting shares in News Corp and Fox Corporation, will be equally split between his four eldest children. A source told the newspaper that while Lachlan does not enjoy universal support in the family, James gets along well with them, giving him the power to effect change with the network when he and his siblings gain control.
But that is rather a question for the future. For now, Murdoch, recently vaccinated against COVID-19, continues to remain in his element, taking meetings, staying engaged and on top of the business, according to a report by The Guardian.
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