Some thoughts on News Corp, Chernin, Murdoch etc.,…..
By Tom Teicholz at 25 February, 2009, 10:34 am
Peter Chernin’s decision to leave Fox and News Corp in June is as good an excuse as any to share some observations about the company (full disclosure: I had a producer deal at Fox/TV Studios).
Murdoch has always had favorite sons — professionally and biologically –. Over time, those executives who have stood with Murdoch, profited with and for Murdoch have often come to believe in their special relationship with Murdoch, only to find out that what Murdoch cares about most — is Murdoch’s way and everyone else is expendable, and someone to whom he will not give in to. This has been the case with Chernin, as it was with Barry Diller and Stephen Chao, and countless other executives over the years. It was the way it was with his ex- wife Anna, and with his children James and Elizabeth, both of whom had to leave Murdoch’s empire (yes, one or both may be back to run the show but Murdoch remains Murdoch).
Last year News Corps’s stock and profitably was down considerably. Majorly. Still Murdoch took home $27 Million and Chernin $28 Million. Imagine if half, two thirds or all of that other than $1Million each had gone to the stockholders in a special dividend?
But no, because Murdoch has long been a player in a highly sophisticated came of three card monte. Murdoch may own newspapers, that don’t make money, and movie studios and Tv stations that sometimes make money and sometimes don’t. But the true business of Murdoch is…. beyond Murdoch, and as best I understand, Murdoch’s true business is the cross-collaterization of his assets in such a fashion as to leverage his personal wealth and influence.
Let’s recall that one of Murdoch recent great successes was the purchase of MYSPACE for $850 Million or so — today that looks like a terrible buy. But let’s recall that at the time, Summer Redstone was so angry that he didn’t get MYSPACE that he fired Tom Freston, an executive who was much liked in the industry and who had only done a great job for viacom, and who hasn’t really resurfaced since.
Then there’s the purchase of the Wall Street Journal — also not looking like such a great buy. And which despite his promises to leave the editorial alone, he has changed — some argue for the better, but his fingerprints are there, too.
But let’s not worry for Chernin — he has a ridiculously great payout deal, and great standing in the entertainment community, and why would he want to soldier on in this economic climate at Fox, possibly for no bonus next year?All things considered, he was wise to get out while the going is good. In the end, no matter how successful he was, Chernin must have realized that it was still Murdoch’s world and he was just running it.
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