Rupert Murdoch thumbed his nose at the media establishment last year with News Corp.’s audacious $5B acquisition of Dow Jones & Co., publisher of the Wall Street Journal, from the battling Bancroft family. What a difference a year makes! The Bancroft gang is sitting pretty these days as pressures on print media and Wall Street’s financial meltdown are taking a nasty toll on their former crown jewel.
The DJ&C news is not good. Let’s go to the release: “In addition, the inclusion of Dow Jones & Company reduced the segment operating income by $4M in the quarter,” reads the report. DJ&C is an earnings clunker. In PRSpeak, it had “negative growth,” or, egads, DJ&C lost money.
Murdoch appears to have forever ditched his plan to offer the WSJ online for free. The 77-year-old Aussie told investors that he plans to radically shift gears and jack up the price of the online Journal, which currently goes for $119, or $59 with a print sub. Murdoch, in fact, plans to raise the subscription price in each of the next three years, which will be a great test of the WSJ’s ability to compete with arch-rival and Internet freebie New York Times.
Murdoch is losing a bit of luster from his media mogul status. News Corp. has backed away from its August projection of low-to-middle- teens percent jump in '09 profit. The company now says operating income will rise about five percent. News Corp.’s stock is trading at $8.31, near a 13-year low of $7.70.
Rupe warns of “leaner operations ahead” and sees “across-the-board job cuts.” Here's a tip: How about starting at Fox News, where the election of Barack Obama is bad news for bloviaters like Bill O’Reilly, Dick Morris and Sean Hannity who now are even more irrelevant?