17 May 2007

Magic Murdoch Fairy Dust

William Powers is Digging Murdoch:
It's been funny watching media people try to wrap their minds around the idea that Rupert Murdoch may be the next owner of Dow Jones and its most famous asset, The Wall Street Journal. Not funny ha-ha, but funny as in tragicomic, as in every laugh is also a sob.

Some day, if we're really lucky, maybe we'll all get to be exploited by Murdoch.

The biggest howler is the idea that Dow Jones -- and The Journal in particular -- desperately need Murdoch, without whom they can't possibly survive in the big, bad world of 21st-century media. The basic argument is that traditional newspaper publishers, and the journalists who work for them, just don't grasp what it takes to thrive in the new marketplace of information. Murdoch, meanwhile, is a bold, creative genius who utterly "gets it." The man bought MySpace, for God's sake, and his empire is all about "synergy." Now he can use MySpace to promote X-Men. Maybe The Journal could do that, too!

Please, Mr. Murdoch, sprinkle some of your synergistic billionaire fairy dust, teach us to be citizens of the modern world.
Powers examines kow-towing articles from The New York Times, the The New York magazine and BusinessWeek.

What really freaks me out is the idea that Murdoch may be thinking he can wrap up the Dow Jones acquisition with plenty of time left over to weigh in on the Australian election. In the meantime, he has Howard and Rudd falling over each other to keep Big Business happy and attract his full endorsement. Oh, happy day.

E&P has even more links to Murdoch-related stories. TIME in particular has a rivetting article:
In 1902, Boston boardinghouse owner Jessie Barron bought Dow Jones & Co., publisher of the Wall Street Journal, with a down payment of $2,500. She did this at the behest of her longtime boarder and not-so-longtime second husband, financial writer Clarence Barron. But Mrs. Barron really was the owner, and when she died in 1918, her majority share passed to her daughter by her first marriage, Jane Bancroft.

The Bancrofts have held a controlling stake in Dow Jones ever since. Jane's husband Hugh Bancroft was company president for a time, but since his death in 1933, the family has mostly kept its hands off. "I want you to do what's best for the company," Jane reportedly told her husband's successor, reporter turned manager Casey Hogate. "Don't you and the boys worry about dividends." The modern, globe-spanning Journal was thus built by "the boys" from the newsroom while the Bancrofts stood benignly by (though they did, as the Journal returned to health after the Depression, eventually start caring about dividends).

Now, as you have surely heard, the three dozen cousins who have a hand in voting the shares inherited from Jessie Barron face a momentous decision. Rupert Murdoch's News Corp. has offered to buy them out at a staggeringly high price--$60 a share, or 75% higher than the market was valuing Dow Jones before the offer. The Bancrofts' initial answer was no, but there is disagreement within the family. If Murdoch ups his bid, anything could happen--and the current betting on Wall Street is that something will.
But what's really good about the TIME aritcle is that it shines a light on the historical context of today's media horror stories:
Newspaper-owning families began selling out in a big way to corporate chains in the 1960s. The largest chains--Gannett, Knight-Ridder, Tribune, Times Mirror--mostly started out family run as well, but as they expanded, the family stake was diluted, and Wall Street came to call the shots. This wasn't all bad; lots of family-owned newspapers were horrible. Knight-Ridder in particular gained a reputation for improving the properties it bought. But with profits under severe pressure from the Internet, Wall Street has turned the screws. Knight-Ridder was sold off and busted up last year; Tribune, which bought Times Mirror in 2000, was acquired by vulture investor Sam Zell in April.

Left standing are the great exceptions to the eat-or-be-eaten model, the family-owned companies behind the country's three best newspapers: the New York Times, the Washington Post and the Wall Street Journal. The Bancrofts were unique in their disengagement from the business they controlled. But their view of the company they inherited as a trust whose value exceeded the dividends it generated was shared by the more hands-on Sulzbergers of New York City and Grahams of Washington. "It's not just family ownership," says Alex Jones, director of Harvard's Shorenstein Center on the Press, Politics and Public Policy and co-author of two histories of newspaper families (the Sulzbergers as well as the Binghams of Louisville, Ky.). "It's a particular kind of family ownership that's nearly miraculous."
TIME suggests that Murdoch's own family business may likewise soon be heading for the dustbin of economic history.

I remember searching the Net for information on the Bancroft family about a year ago, and hitting a wall of nothingness. There just wasn't anything about these people available to the public online.

What tickled my fancy this week was that the Wall Street Journal, a bastion of pro-Bush propaganda, actually linked to my blog (via sphere.com). The enemy of my enemy is my friend? How long before I get paid to write articles, just like Omar and Mohammed Fadhil? And oh - by the way - I notice there is still not a single word on this hugely important WSJ deal from Tim "inside the tent" Dunlop.