Murdoch weighs plans for Journal
Rupert Murdoch said he planned to sell Dow Jones & Co.’s smaller newspapers and hire more staff to bolster the Wall Street Journal’s presence, especially in Europe and Asia.
The News Corp. chairman and controlling shareholder, who sealed a hard-fought deal to buy Dow Jones last week for $5 billion, also said Wednesday that he was still weighing other steps after the transaction closes in a few months.
Among other things, Murdoch said he hadn’t decided whether to make the Journal’s website free to visitors. Murdoch said it was the largest paid site in the world with nearly 1 million subscribers.
“In the short term, it may be an expensive thing. In the long term, it may be a wonderful thing to do,” Murdoch said during a conference call with reporters and analysts to discuss News Corp. quarterly earnings.
The discussion marked Murdoch’s most expansive comments to date about the prize he claimed after more than a decade of desire.
Indeed, questions about the Dow Jones deal overshadowed News Corp.’s strong earnings report. The New York-based media giant boosted quarterly profit to $890 million from $852 million on surging cable and satellite results.
Murdoch said he put up with withering criticism of his ethics from Dow Jones insiders, including members of the controlling Bancroft family, because of his confidence that the Journal and other assets were a “perfect fit” with News Corp, which includes a cable business channel launching in more than 31 million homes Oct. 15.
“Dow Jones is arguably the world’s most powerful, prestigious brand in financial services,” Murdoch said, praising its “tremendous journalists and excellent management.”
But with News Corp.’s reach -- which includes satellite television in Asia and Europe, the Fox broadcast network and newspapers that include the Times in London -- the Journal can be vastly expanded, he said. By combining some production with that of Dow Jones, the company will save about $50 million annually. No layoffs are planned.
The expansion in print media has bothered some News Corp. investors, who are more enthusiastic about the company’s online properties, especially MySpace, the top social networking site.
News Corp. executives said Fox Interactive Media, which includes MySpace, turned a $10-million profit for the fiscal year that ended June 30 on revenue of $550 million, topping earlier projections. Largely because of a growing deal with Google Inc. to place ads on MySpace, Murdoch said he would be surprised if Fox Interactive didn’t reach $1 billion in annual sales and $200 million in profit this fiscal year.
The Fox business channel will cost $150 million to $200 million to launch and should break even in a couple of years, executives said.
For the fourth quarter, News Corp. reported profit of 30 cents a share, up from 24 cents a year earlier. Revenue rose to $7.4 billion from $6.8 billion. Movie and television income fell but cable profit jumped as Fox News negotiated new contracts with major carriers.
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