should rupert murdoch be able to buy the wall street journal?

That wily Fox Murdoch bids for Wall Street Journal

from newsday

BY VERNE GAY
verne.gay@newsday.com; Staff writer Susan Harr

May 2, 2007
Dow Jones, meet Homer Simpson.

In an audacious bid that could match one of the world's most unconventional media titans with one of the world's most buttoned-down media companies, Rupert Murdoch's News Corp. yesterday made an unsolicited offer for Dow Jones & Co., publisher of The Wall Street Journal.

But that headline was immediately followed by a question - what's Rupert up to now? - and obvious answers were hardly forthcoming. That should surprise no one because Murdoch has spent a career pursuing deals that often bucked conventional wisdom - the creation of a fourth TV network called Fox, for example, comes immediately to mind - that only later proved why such wisdom is so named.

And while there have been some duds in this long and colorful career, none have been recent. News Corp.'s 2003 $6-billion purchase for a controlling stake in DirecTV and the $580-million purchase of Intermix, which landed *******, now look like bargains (particularly the latter.)

But why $60 per share - a huge premium - for a distinguished newspaper that is nonetheless part of what is politely called "a declining business sector?"

In other words, what's Rupe up to now?

Yesterday's news - first reported in late morning on CNBC, followed a short time later by a terse confirmation by News Corp. - sparked speculation that Murdoch was trying to shore up the anticipated launch this fall of the Fox Business Channel, or perhaps even salvage the venture.

However, rival CNBC already has an exclusive "content" deal with Dow Jones until 2012 that would appear to preclude any sort of sharing arrangement between Journal staffers and the new Fox channel. During an afternoon interview on Fox, Murdoch dismissed the roadblock, citing Fox News' "The Journal Editorial Report," which features editors from the newspaper's editorial pages. "We think there's plenty of room for us all to work together," he said.

Meanwhile, representatives of the Bancroft family - the dynasty that controls the Journal - said the family will vote against the proposal. For that reason, veteran newspaper analyst John Morton said yesterday, "unless the Bancrofts have changed, nothing will come of this. I suspect Murdoch knows the situation, knows it intimately, so he may have some other motive. I haven't the foggiest what it is."

Edward Atorino, a media analyst for the Manhattan firm Benchmark Co., called Murdoch's move - if successful - "brilliant," adding that the Journal imprimatur would give the new biz channel "instant credibility, organization, talent and content, [and] what would you rather have? The News Corp. Business Channel, or the Wall St. Journal [Channel]?"

In an e-mail, Jack Myers, president of the Jack Myers Media Business Report, said Murdoch "views Dow Jones as an under-developed asset that brings unequaled global brand equity. This reminds me of Ted Turner's bid for CBS in the '80s. CBS thought Turner wasn't good enough, but it would have been a great deal for ... ."

Dan Cooper, a former Fox News executive and more recently a News Corp. gadfly, said, "The news at the center is editorially conservative, and so the values are shared in terms of Murdoch and his point of view."

Meanwhile, there was plenty of skepticism. As Porter Bibb, a managing partner of Mediatech Capital Partners, said during an interview on CNBC, "This is about the fifth or sixth offer that [Murdoch's] floated over the last five years for Dow Jones and one has to begin to wonder how much confidence he has" in his proposed business news channel.

"Fox Business needs something like ... [this] to come out of the gate roaring."

Staff writer Susan Harrigan contributed to this story.

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