All this activity, combined with Mr. Murdoch’s very public declarations of his intention to challenge The Times, has left some top editors at the Gray Lady scratching their heads.
Dean Baquet, The Times’ Washington bureau chief, said he believes “The Journal has not, itself, figured out how it would change the mission of its Washington bureau.”
As for Mr. Keller, he told The Observer: “I don’t know what Murdoch really intends to do, but if his plan is to put money into serious, credible news gathering, that’s good for the country, good for the news business and good for us.”
He went on: “We have every reason to feel confident that we can hold our own if Murdoch decides to build The Journal beyond its business-reader base.” And he added: “In all the Murdoch parlor gaming, I don’t hear anyone suggesting that he would attempt to match the depth of our coverage in culture, science, education, health, religion, sports, lifestyle, etc., etc. Not to mention business coverage that even devout Journal readers find they can’t afford to miss.”
One way to hold off The Journal is to poach its talent. Since the Dow Jones deal was announced, Mr. Keller has held open slots on the Times staff, anticipating waves of refugees from The Journal as a result of Mr. Murdoch’s takeover. According to one Times staffer, it was expected that The Times “would have been able to pick people off left and right.”
But the mass exodus hasn’t yet materialized. According to sources at both papers, when The Times’ business editor, Larry Ingrassia, recently contacted several Journal reporters—including James Bandler and Mark Maremont, who together won a Pulitzer last year, along with several other Journal reporters, for their work on backdating stock options, as well as Melissa Marr, Kate Kelly and Mike Siconolfi, a Journal veteran of more than 20 years—about moving over, he came up empty-handed. (The sources stressed that Mr. Ingrassia didn’t make specific job offers.)
Indeed, it may be just as likely in the long run that the poaching goes the other way. In his June Time magazine interview, Mr. Murdoch mused: “What if, at The Journal, we spent $100 million a year hiring all the best business journalists in the world? Say, 200 of them.” What if, indeed.
Some analysts don’t think The Times has much to worry about—at least for now. “Murdoch can broaden the editorial base and he could damage The Times’ core readership base, but he would have to spend a lot of money,” said Ed Atorino of Benchmark Co. “The New York Times is a pretty strong franchise. At the least, it would take years to put a dent in The Times.”
But spending a lot of money is hardly something that Mr. Murdoch has been unwilling to do in the past. And Mr. Atorino admitted that the disparity in size and value between the two companies—News Corp.’s market capitalization stands at $69.6 billion, while the Times Company’s is just $2.7 billion—gives Mr. Murdoch some advantages. “News Corp can spend $5 billion without a dent,” he said, referring to how much the company is shelling out on Dow Jones.
It’s also no secret that the Times Company remains on precarious financial footing, This year it has already written down the value of New England Media Group—which includes The Boston Globe—by $814 million; sold some television affiliates; seen sharp advertising losses; faced a shareholder revolt, led by Morgan Stanley, against company leadership; and watched as The Times’ former West 43rd Street headquarters changed hands for $350 million more than Mr. Sulzberger unloaded it for in late 2004. And since 2003, the Times Company’s share price has plummeted from $46 to $19, while News Corp’s has risen from $17 to $24.
But don’t look for Mr. Murdoch to immediately gin up an all-out circulation battle, as he did when he used the New York Post to take on the Daily News. “Murdoch doesn’t need to defeat The New York Times, but if he could take away 3 to 5 percent of its business, then that’s going to hurt them when they’re already in a period of hurt,” Mr. Doctor said. “It’s not a knockout blow, but it makes the hill The Times has to climb even higher as they make the transition from print to digital.”
So the war could drag on. But as Mr. Murdoch is fond of saying, he may have another 20 years in him—his 98-year-old mother is still alive—and it remains to be seen whether Mr. Sulzberger has the stomach to beat off such an aggressive competitor. As Mr. Keller notes, The Times sits solidly at the top of the heap, but Mr. Murdoch has always been adept at leveraging his status as the underdog newcomer—even with a multibillion-dollar corporation behind him—into an asset.
In taking on The Times, Mr. Murdoch may have set himself his toughest challenge yet. But as Mr. Ailes pointed out this week to the FBN team, those predicting Mr. Murdoch’s failure in the past have almost always been off the mark.
John Koblin contributed reporting to this article.