Rupert Murdoch may be set to join the tiny ranks of nonagenarians running global empires when he celebrates his 90th birthday on Thursday, but according to associates who have met with the media mogul recently, he shows no sign of slowing down.
“Honestly, it’s the fittest I’ve seen him in years,” said one person who held a meeting with Murdoch, just prior to the latest lockdown, at Holmwood House, the Georgian property near Henley-on-Thames he acquired for £11.25m two years ago with his former model wife Jerry Hall, and where he has spent most of his time during the pandemic. “I expected him to be, well, more tired. Instead he takes lots of meetings, when Covid restrictions have allowed, he is wanting to be engaged, talk about things, to keep on top of business.”
As executive chairman of News Corp, home to the Wall Street Journal, the Sun, the Times and the Australian, and co-chairman of Fox Corporation, broadcaster of Fox News and crown jewel NFL games, Murdoch remains firmly in control of a formidably powerful media empire.
Having weathered the phone-hacking scandal that threatened to destroy his UK news operation it is now Fox, which is run by eldest son Lachlan, which will shape the future of the Murdoch empire and play a key role in determining the dynastic struggle.
Fox is a commercial juggernaut, led by the right-leaning Fox News which enjoyed supercharged ratings and notoriety during the Trump era, a must-have for pay-TV operators that has paid off handsomely for decades.
“I don’t think it is possible to have a cable subscription of any substance [in the US] without Fox News or Fox broadcast – as long as it has the NFL,” says Richard Greenfield, a partner and media and technology analyst at LightShed Partners.
Fox News faces issues. There is a multibillion-dollar lawsuit over allegations it promoted the spread of theories the US election was rigged, and the pull of audiences to services further to the right, such as Newsmax and Donald Trump’s new favourite One America News Network (OANN). But they are unlikely to particularly concern the battle-hardened Murdoch.
However, the long-term implications of the network’s editorial stance, and that of a number of its news publishing assets, poses an increasing problem for Murdoch when power is ultimately transferred to his four eldest children.
Asked about whether Fox News had played a role in the Capitol riot in January, Murdoch’s 48-year-old younger son James – once seen as the heir apparent – effectively rebuked the family business, saying that US media groups “propagated lies” unleashing “insidious and uncontrollable forces” – although he stopped short of naming Fox itself.
Last summer, James resigned from the board of News Corp, citing “disagreements” over editorial content, severing his last formal link to the empire created by his father.
Despite Fox’s commercial success Murdoch faces a familiar problem: lack of scale. Fox is valued at $22bn while rivals such as Disney and AT&T – which trumped Murdoch following his failed $80bn bid in 2014 to take over TimeWarner to bulk up 21st Century Fox enough to remain globally competitive – are valued at $350bn and $200bn respectively.
The traditional US TV market is rapidly shrinking as streaming redefines what consumers are willing to pay for content. A record 6m US households cancelled pay-TV subscriptions last year.
Meanwhile, reports that Amazon is poised to snap up exclusive NFL games for its Prime Video service is a timely reminder of the competition new deep-pocketed digital rivals are putting on winning prime programme rights, and the threat they pose to incumbent broadcasters such as Fox’s sports networks.
“The key question as we look forward to 2022 and 2023 and beyond is that it is truly eat or be eaten,” says Greenfield. “Fox and many of their peers don’t have scale. It is hard to believe that Fox stays as a standalone company five years from now. Fox is probably right now trying to work out how it evolves over time.”
In 2017, Murdoch recognised his limitations in the global entertainment battle and made the rare move to sell by offloading 21st Century Fox – home of assets ranging from The Simpsons to the X-Men and Avatar franchises – to Disney for $71bn. Each of his six children banked $2bn from the deal. Comcast subsequently won the £30bn bidding war for Sky.
“Are we retreating? Absolutely not,” said Murdoch at the time. “We are pivoting at a pivotal moment.”
As a clause in the Disney deal which blocked Murdoch from making any more asset sales comes to an end this month, Murdoch now has the chance to assess whether to pivot again.
Multiple analysts believe there is no commercial logic in the oft-mooted recombination of Fox with News Corp, which is run by Murdoch’s right-hand man Robert Thomson, who shares a birthday with his boss and will celebrate his 60th on Thursday.
The view is that in the short term the well financed businesses are more likely to be buyers.
Lachlan, 49, has already acquired ad-supported streaming service Tubi for $440m and is highly likely to increase its stake in betting firm Flutter – the parent company of Paddy Power, Skybet and Betfair. But over the longer-term there will be a wider reorganisation of the existing portfolio.
“Murdoch has displayed an extraordinary capacity to let go,” says Claire Enders, founder of Enders Analysis. “While I don’t see Fox News as saleable, like the Wall Street Journal and the Sun I can’t see anything happening with them while he is alive. He is a real news man, but no one says his children love the mandatory political elements of the news businesses the way their father does.”
Heir apparent Lachlan, who shocked his father by abruptly leaving the family business in 2005 to move to Australia and pursue his own interests before being enticed back a decade later, will have his own agenda – if he sticks with the family firm.
“There have always been questions over what Lachlan ultimately wants to do,” said one source. “When Rupert is in the room Lachlan certainly plays the supporting role to Rupert. But when Rupert leaves Lachlan definitely assumes that [leadership] role.”
When the Rupert-era eventually ends the power behind the family trust, which controls 40% of voting shares in News Corp and Fox Corporation, will be equally split between his four eldest children. His two youngest daughters, Grace and Chloe, are financial beneficiaries.
“Lachlan doesn’t have universal support across the family,” says one source. “James and Elisabeth get on very well. Prudence and Elisabeth get on very well. There is a route to potentially effect change if that’s what they want.”
But given Rupert’s mother, Dame Elisabeth, lived until 103 that could still be some way off, giving the Australian-born mogul time to extend seven decades of deal-making, reshape the family empire to assuage division and ensure the next generation keeps the Murdoch legacy intact.
Source: The Guardian