Observer » Dow Jones & Co. Inc.

Murdoch Says Journal Will Worry About Structure First, Then Find the Talent

John Koblin — Thu, 29 May 2008 20:49:24 -0400

Rupert Murdoch spoke at The D Conference this week, and laid out more non-specific but interesting plans for The Journal.

For months, it's been speculated that Murdoch cares more about figuring out the actual structure of the paper, and then he'll get down to the dirty business of assigning the right reporters to the right assignements, and signing a few superstars.

How else to explain the fact that the paper hasn't really picked up any boldface names since he got control of the paper in mid-December (the lone exception is Sue Schmidt from The Washington Post)?

So when he was asked today whether he intends to put money into the paper, he said: "There are more reporters wherever I need them. I think at the moment, there are ways in which we do things that should be changed and made much better."

For instance, all those pesky editors who are running around at that paper!

Every story in the moment at The Wall Street Journal, on average, is touched or edited by 8.3 people. That is ridiculous. Alright? I’m serious. And everybody who goes to it says, 'What about this? What about that?' And the story gets longer and longer and longer. And people don’t have time for it. There’s not a story that you can’t get all the facts in half the space.

And then, of course, what's a conversation with Murdoch without mention of The Times?

I think, nationally, those who buy their local paper,ad instead of buying both The Journal and The Times, they’ll buy one or the other. It’ll happen right away. I mean, over a few months. I think we’ll expand, we may affect The Times. I think they’re a great organization, I think they’ll react and I think you’ll find the emergence of two very strong national papers—and you’ll have a choice.

Thomson as New Journal Editor: ‘I Feel Privileged’

John Koblin — Tue, 20 May 2008 22:53:59 -0400

We just caught up with Robert Thomson, who, it was just announced, will be the newspaper's next managing editor, on the phone. "I feel privileged," he said. "I'm looking forward with much excitement to making the Journal, and its news wires, which is the greatest news organization in the world, even greater."

He will move down to the newsroom's ninth floor tomorrow, and will take over chief editing duties over the paper immediately.

Read the Journal's own breaking account of the story here; bonus choice moment from Martin Peers' account:

The departure of Mr. Brauchli -- who quit under pressure last month -- and Mr. Thomson's appointment are expected to lead to bigger changes at the Journal. The paper has already seen a shift in focus since the News Corp. acquisition, putting more emphasis on shorter news stories and general news. Mr. Murdoch wants the Journal to compete more directly with the New York Times.

Which, of course, we've been harping on around here.

Much more to come in the next few days.

Robert Thomson Named Editor of The Wall Street Journal

Tom McGeveran — Tue, 20 May 2008 22:39:28 -0400

Here's the News Corp. press release. More coming shortly.

Robert Thomson has been appointed Editor-in-Chief of Dow Jones and managing editor of the Wall Street Journal, effective immediately, Rupert Murdoch, Chairman of Dow Jones & company, announced.

The Dow Jones Special Committee today unanimously endorsed Mr. Thomson's appointment following his nomination by the Company last week.

Mr. Murdoch said: "Mr. Thomson's outstanding career as a financial journalist, foreign correspondent and editor, equips him perfectly for the position."

Les Hinton, Chief Executive Officer of Dow Jones, said: "Robert is the ideal editor to unlock the vast potential of the Wall Street Journal and our other Dow Jones brands, both in this country and around the world."

Mr. Thomson will oversee the news section of the Wall Street Journal and the editorial operations of Dow Jones News Wires. Neal Lipschutz, News Wires managing editor, will report to Mr. Thomson. Paul Gigot, Editorial Page Editor of the Journal, will report to Mr. Hinton, who will assume Mr. Thomson's role as Publisher of the Wall Street Journal in addition to his existing duties.

Robert Thomson was appointed Publisher of Dow Jones in December 2007, having been Editor of The Times of London since March 2002. Prior to that he was Managing Editor of the US Edition of the Financial Times, taking responsibility for the FT's ambitious drive into America, where the newspaper trebled its sales to almost 150,000 during his four-year tenure. For his work in developing the FT, in print and online, he was named US Business Journalist of the Year in 2001. From 1996 to 1998, he was Editor of the Weekend FT, orchestrating a successful redesign of that paper, which became the fastest-growing newspaper in the UK market during 1997. He has served as a correspondent in Beijing and Tokyo, and began his career as a copy boy at The Herald, Melbourne, in 1979.

Mr. Thomson's appointment follows the resignation as managing editor of Marcus Brauchli. Mr. Brauchli resigned after a meeting with Dow Jones executives.

Referring to the circumstances of Mr. Brauchli's resignation, Mr. Hinton said: "The Company believes it was acting in accordance with the agreement and had no intention of subverting the role of the Special Committee. In hindsight, we recognize it would have more been appropriate to have advised the Committee in advance of reaching an agreement with Mr. Brauchli. We have apologized to the Committee members and undertaken that in future we will consult with it and seek approval of the Committee before taking any action with respect to an editor that could result in a material change in an editor's duties, responsibilities or reporting relationships or the departure of that editor."

Financial Times Girds for Battle With Rupert

Tom McGeveran — Tue, 02 Oct 2007 13:33:50 -0400

With Rupert Murdoch talking about taking The Wall Street Journals Web site free, Financial Times is girding its loins for battle.

The newspaper announced yesterday that later this month it will initiate a program that allows online readers to access 30 articles a month without registering as paying members of the site.

Presently most of its content requires a subscription.

While other newspapers like The New York Times have been dismantling paid-content schemes, publications like Financial Times and The Wall Street Journal stand to lose more by going free, since they have a natural market of deep-pocketed corporate expense accounts to drain for subscription revenue.

But if Mr. Murdoch is willing to take that risk to expand the Journal's readership, its main competitor may find itself stuck if it doesn't follow suit.

From The Times' article today:

The shift, part of what Mr. Ridding described as a broad overhaul of FT.comthat will be phased in over several months, comes as other newspapers are rethinking their efforts to charge users for online content. A surge in online ad spending over the last three years has persuaded many publishers that it is better to increase their Internet audience, in an effort to appeal to advertisers, than to try to squeeze meager revenue from online subscriptions.

The New York Times

Another Reporter Leaves WSJ For Portfolio

Felix Gillette — Fri, 10 Aug 2007 21:49:14 -0400

In the wake of Rupert Murdoch’s purchase of Dow Jones, another veteran Wall Street Journal reporter is leaving the paper to join Conde Nast’s Portfolio.

Scot Paltrow, a senior special writer for The Wall Street Journal, will join Portfolio as a contributing editor, starting Sept. 1.

He follows Peter Waldman there; the investigative features writer announced in July that he would be leaving the Journal for Portfolio after 22 years.

Mr. Paltrow first began working at the Journal in 1981. After leaving the paper for several years, he rejoined the Journal in 1997.

Did Rupert “Buy Off” Bancroft Advisers?

Tom McGeveran — Thu, 02 Aug 2007 12:28:27 -0400

Yesterday, lots of Wall Street Journal staffers and one former Dow Jones board member, James Ottaway, talked to the Observer about what, in the final hours of News Corp.'s bid to buy Dow Jones, had increasingly become the central issue: Could Dow Jones set up a $30 million fund to pay the lawyers and bankers who had advised the Bancrofts on the sale-and have Rupert Murdoch foot the bill? A decisive number of the Bancroft family would agree to the sale if they could be relieved of the debt to their advisers. Dow Jones said yes, and so, in turn, did the Bancrofts.

But the question that lots of staffers and Mr. Ottaway asked was, can the lawyers and bankers have been neutral in their advice to the Bancrofts if they were being paid by the company that wanted to buy their company?

The New York Times explores the question today and gets some interesting, if finally inconclusive, results. “Any suggestion that the advice rendered to the family members or trustees by their advisers was in any way conflicted is completely baseless,” a Bancroft family spokesman tells the Times today. But:

Several family members, including Christopher Bancroft, who is a board member and opponent of the deal, have privately said they were misled, according to family members. These people also suggested that the advisers steered them toward selling, putting them in an almost untenable position to say no.

In fact, from the beginning, the Bancrofts appeared to be confused from one moment to the next what they were committing to as the negotiations with News Corp. unfolded. Answering a question we asked very early in the process, the Times reports:

In perhaps the most telling example, family members said that some of them did not realize they were effectively putting Dow Jones, publisher of The Wall Street Journal, up for sale two months ago when they agreed to meet with Mr. Murdoch.

“After a detailed review of the business of Dow Jones and the evolving competitive environment in which it operates, the family has reached consensus that the mission of Dow Jones may be better accomplished in combination or collaboration with another organization, which may include News Corporation,” a statement from the family said.

The statement was drafted by lawyers at Wachtell Lipton and presented to the board on May 31. By the time Christopher Bancroft read it at the meeting, it had already been leaked to The Journal. Mr. Bancroft, who thought it went too far in putting the company in play, immediately asked to have it recalled, but was told that it had already been posted on the paper’s Web site.

Now, that may seem like a small thing. But lawyers and bankers working with the Bancrofts would have known that a public statement that the company would be better off in the hands of a new owner essentially puts the company up for sale. Of course, the statement could have--and did--attract other buyers. But it essentially removed the possibility that the Bancrofts might just keep Dow Jones themselves. Non-Bancroft shareholders now had ammunition to compel the Bancrofts to sell. And advisers to the Bancrofts did not, some contend, take offers from other suitors seriously.

Also, as we've been reporting, Paul Steiger, the former managing editor of The Wall Street Journal, was on special assignment to direct the Journal's coverage of the sale. As we have noted, Mr. Steiger stands to profit, according to some reports, to the tune of $4 or $5 million from the News Corp. deal. (Through a spokesman Mr. Steiger has claimed the number to be exaggerated.) Mr. Steiger had also been mentioned as a possible board member of News Corp. should the deal go through.

It seems worth asking how the May 31 statement made its way into the newsroom.

At the very least, one wonders whether it was wise for Dow Jones to make the $30 million agreement. Couldn't that form the basis of some litigation over the merger?

Of course, the question would be, litigation on behalf of whom? The Dow Jones board wanted this to happen; so did many of the Bancrofts. Does anyone have standing?

Dow Jones Files “Independence Committee” Agreement With S.E.C.

Thu, 02 Aug 2007 12:04:25 -0400

When the Dow Jones board agreed to sell to Rupert Murdoch's News Corp., a condition of the sale was that News Corp. establish a "Special Committee" to guarantee the editorial independence of Dow Jones publications.

That part of the sale agreement was filed with the Securities and Exchange Commission yesterday. And for the obsessives, FishbowlNY has posted the entire agreement online here.

Some highlights:

The Members of the Special Committee shall be divided into three classes. The first class shall consist of one Member and the second and third classes shall consist of two Members. The initial term of the first class shall expire on December 31, 2012; the initial term of the second class shall expire on December 31, 2013; the initial term of the third class shall expire on December 31, 2014. Upon the expiration of the term of any class, a new term of the class shall commence, and this term shall expire on the fifth anniversary of the commencement of this term. ...

Upon the expiration of the term of a class, a majority of the remaining Members of the Special Committee shall appoint or reappoint an individual or individuals, as applicable, selected by the Special Committee as a Member or Members, as applicable, of the class for the new term then commencing. Any appointment or reappointment shall be subject to the approval of the Company, which shall not be unreasonably withheld or delayed. Any proposed appointment or reappointment shall be deemed to be approved by the Company if no written objection to the appointment or reappointment is received from the Company by the Special Committee within ten (10) business days following the Company's receipt from the Special Committee of written notice of the proposed appointment or reappointment. Subject to the foregoing sentence, a Member may be reappointed to the Special Committee upon the expiration of the term of his or her class. ...

Each Editor shall have the right to appeal disputes with the Company, Dow Jones or their respective Affiliates concerning (i) the Special Committee Matters, and (ii) the matters set forth in Sections 2.1(e) and 2.1(f) (but only to the extent any such dispute relates to Dow Jones, any of its subsidiaries, a Dow Jones Publication (as defined in Section 2.1(f)) or to journalists or journalism of Dow Jones or its subsidiaries or a Dow Jones Publication), to the Special Committee for resolution, and the Special Committee shall seek to resolve such disputes in a prompt manner. All decisions and determinations made by the Special Committee with respect to any such dispute shall be final and binding.

Shekel Heckle: James Ottaway Blows Up

Wed, 01 Aug 2007 14:05:09 -0400

Here was former Dow Jones board member James Ottaway Jr.'s reaction to the news that the Dow Jones board was ready to approve the sale to Rupert Murdoch's News Corp.:

It’s a bad thing for Dow Jones and American journalism that the Bancroft Family could not resist Rupert Murdoch’s generous offer.

It’s a sad thing that the 105-year family tradition of protecting Dow Jones independence as a public trust will end.

I hope Rupert Murdoch, and whoever follows him at News Corp., will keep his promises to protect and invest in the unique quality and integrity of the Wall Street Journal, Barron’s and all the Dow Jones electronic news services.

And I hope the Bancroft Family, which has been torn apart by Murdoch’s poison pill offer, will enjoy family peace after so many years of patient and caring support for Dow Jones and its people.

At this global information age, it is outrageous that anyone should have to pay an estimated $30 million to outside advisors. It is ironic indeed for the Bancroft family to have to pay 30 shekels of silver to their investment bankers, and 30 shekels of gold to their corporate lawyers, for scaring some of them into betraying their 105-year family loyalty to Dow Jones independence.

Bancrofts: We’re Not Done Yet!

Tue, 31 Jul 2007 17:59:24 -0400

A spokesman for the Bancroft family just sent us this statement:

“The process of canvassing the Bancroft family members and trustees as to whether they wish to commit their respective shares to the proposed News Corporation transaction is still under way. Any suggestion that the process has been completed and/or that a particular level of support has been established is at this point premature."

Report: Rupert’s Dow Jones Takeover a “Done Deal”

Tue, 31 Jul 2007 13:51:38 -0400

David Faber, the CNBC reporter who first broke the news that Rupert Murdoch had offered $5 billion to buy Dow Jones, is now reporting that Dow Jones will agree to the sale.

According to Faber, a "definitive agreement" is expected from the Dow Jones board tonight. You can click through here to see CNBC video of his report.

A print extract accompanying the video presently reads in part:

"It did come awfully close, in fact, closer than many had anticipated," Faber said. "But at the end of the day, according to people who were working on this, a number of the Bancrofts who had been somewhat vocal in their opposition--Chris Bancroft for example--seemed suddenly at the realization that they were going to have to pay all these banking fees said 'Wait a second. Hey, if you pay my fees, I'll give you my vote.' And that may have turned it."

This morning's Wall Street Journal reported that as of late last night, Christopher Bancroft had still not agreed to suport the bid or to the fees deal. It was unclear whether Faber had knowledge that Mr. Bancroft had since been moved on the issue when the CNBC report came out this morning.

We'll be watching to see if this pans out.

The Dow Jones board is expected to meet tonight at 7 p.m.; the News Corp. board has a meeting at 4 p.m. at which board members will probably be told the result of the Bancroft family's internal negotiations.

So it's possible that a deal could be pretty much confirmed even earlier than Faber predicts, like this afternoon. But then, as one source told The Los Angeles Times, "I'd be very surprised if [The Bancrofts] acted any differently from how they have all along—confused and tardy."