Friday, September 22, 2023

THE TIME IS RIGHT: Rupert Murdoch's Heir Apparent

The ruthless, decades-long sibling rivalry that inspired “Succession” is coming to a quiet close, as Rupert Murdoch hands the keys to Fox and News Corp. to his eldest son Lachlan. But with the less-hands-on son taking over from the business and media legend, experts say this family saga is far from over.

The Toughest Act to Follow Is

Rupert Murdoch | Analysis

Natalie Korach

Fri, September 22, 2023 at 6:00 AM MST·7 min read

Murdoch for decades was concerned about his successor, and long wanted one of his three children with his second wife — Elisabeth, Lachlan and James — to take over, at one point intentionally plunging them into a lengthy succession battle. Besides being the oldest son, Lachlan also had the advantage of sharing his father’s right-wing political ideology, and his heir-apparent status became clear in recent years as he ascended within Fox Corp.
But analysts suggest that Lachlan, 52, will struggle to fill his father’s legendary shoes, at a particularly challenging time for Fox News.

“Like father, like son? That’s the key question about Lachlan Murdoch,” media reporter and author of upcoming book about Fox News, “Network of Lies,” Brian Stelter told TheWrap.

The biggest difference analysts point to is in management style. While Rupert was notorious for his day-to-day, hour-to-hour involvement in both editorial and financial matters, Lachlan is seen as more hands-off.
“Our experts highlight how engaged Rupert Murdoch has been with Fox’s day-to-day business operations even after spending seven decades building his media empire,” Jamie Lumley, an analyst for Third Bridge, told TheWrap. “While Lachlan Murdoch will likely take a similar approach to leadership, this definitely marks an important transition for the company.”

It almost doesn’t matter what approach Lachlan takes — it’s effectively destined to be less vigorous than the extremely high-metabolism involvement of his father, who started with a small Australian newspaper and, for the next 70 years, never stopped building.
And just how distant the senior Murdoch will be is another question. In his departure statement on Thursday, Rupert Murdoch promised to be “involved every day in the contest of ideas… watching our broadcasts with a critical eye, reading our newspapers and websites and books with much interest, and reaching out to you with thoughts, ideas, and advice.” Which is what he does currently, several wags remarked.

He added: “You can expect to see me in the office late on a Friday afternoon.”

Still, for Angelo Carusone, Media Matters for America president and longtime Fox News critic, losing a strong hand at the till could give way to a rise of its worst elements within.

“Fox News is going to be worse than it’s ever been,” Carusone told TheWrap. “In part because Lachlan’s a bit of an absentee leader. He doesn’t really engage with the company in the same way.“

Steven Schiffman, adjunct professor at Georgetown University’s McDonough School of Business, who worked with Rupert Murdoch at National Geographic, highlighted his former leader’s passion for news.

“Now the question is, will Lachlan have the same sort of business chops, now that his dad is really not calling any of the shots?” questioned Schiffman. “I think that’s just a question mark.”

Over the years, Rupert Murdoch has, in fact, made a significant amount of high-risk, high-reward deals that cemented him as a true media empire builder.

After acquiring a large chunk of the British media market, Murdoch purchased 20th Century Fox and by the following year had launched the Fox broadcast network.
Then, in 1996, Murdoch started Fox News with Roger Ailes, who would be its longtime leader.
In 2007, Murdoch acquired Dow Jones & Company, the parent company of the Wall Street Journal, for $5 billion. Disney acquired most of 21st Century Fox’s assets in a $71.3 billion deal in 2019 (some of which Disney is now attempting to bring to market again).

“Rupert Murdoch is a very tough act to follow,” Schiffman said. “He’s a hall-of-fame business executive. So Lachlan or anyone else is not going to be able to follow that.”
Stelter said, “The knock on Lachlan for several years is that he is too laid back and too much of a caretaker CEO. This is his opportunity to prove the critics wrong.”
“I have no reason to believe that he will,” continued Stelter. “But this is the moment.”

Lachlan’s first job within the family business was at the age of 18 — and only four years later, he was running a newspaper in Queensland, Australia. By the time he was 34, Lachlan was one of the most influential News Corp. executives, controlling the New York Post and Fox TV franchises.

He unexpectedly left in 2005 for Australia with his family, following a dispute in which his father sided against him on key decisions about the networks.
In 2015, it seemed as though Murdoch was preparing his succession plan by appointing Lachlan and his bother James as co-chairmen of 21st Century Fox.
As Stelter pointed out, at that time, Lachlan believed that his father was “never retiring.”

But James, the more liberal of the two brothers, eventually left the family business, making Lachlan CEO of Fox Corp. in 2019, following Disney’s acquisition of 21st Century Fox.
“It’s been clear for the better part of a decade that Lachlan was the favorite son,” Stelter told TheWrap. “And at least for the past four years, James has been entirely on the outside.”

France 24

5:05

End of an era? Rupert Murdoch steps down as chair of News Corp, Fox Corp

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Uploaded: Sep 21, 2023

Seventy years after inheriting the Australian newspaper that he used as a foundation to build a global empire, media mogul Rupert Murdoch says his son Lachlan will replace him as chair of Fox ...

“You have a moment where everything’s going to be sort of tumultuous, and a leader that’s not going to be able to navigate the ship during that moment,” Carusone told TheWrap. “You still have an entity out there, that even though its influence is waning, it’s still a particularly destructive force.”
Lumley said the change comes at a challenging time for Fox:

“The potential liability from the Smartmatic lawsuit still hangs over the company.
Questions also remain about how Fox will approach its programming and coverage of the 2024 election cycle, a year which will be flush with political ad dollars.”
Fox Corp. agreed to pay a $787.5 million settlement for Dominion Voting Systems’ defamation lawsuit in April, after a disastrous deposition from Murdoch himself, in which he seemed at times to reveal that Fox leaders knew they were “endorsing” lies about the 2020 election.

“It was a really bad deposition for the company,” Carusone told TheWrap. “He pretty much conceded their defense. It put Fox in a much worse position.”

Fox News faces an even larger lawsuit from Smartmatic, another voting systems company, for $2.7 billion. And for this one, Lachlan will be on his own.

Analysts say Lachlan’s ascent also diminishes even further the possibility of a merger between Fox Corp. and News Corp., which was first proposed by the father-son duo in Oct. 2022, and subsequently called off in January.

“Synergies of such a merger are no longer as apparent as they were in previous years, and without Rupert advocating for it, it’s hard to see a renewed push anytime soon,” Lumley said.
Shareholders will sniff that out right away, analysts said.

“They need to convince both sets of shareholders that it’s in their interest to re-merge these companies,” Carusone said. “
That’s nearly impossible to do because if you are a News Corp. shareholder, you are insulated from all of the liabilities of Fox Corp.
Why would a shareholder of News Corp. potentially take on multiple billions of dollars in legal cases or settlements?”

Ultimately, whenever the now 92-year-old Rupert Murdoch eventually dies, Lachlan Murdoch will go back to sharing control over the family empire along with his siblings.

The senior Murdoch’s shares will be evenly split among his four eldest children (including daughter Prudence from his first marriage).
With that, Lachlan will potentially lose control of the company.

“It’s not over yet,” said Carusone.

“He doesn’t have it long-term unless his siblings agree.”
Carusone continued, “Lachlan sort of temporarily won but there’s going to be a tiebreaker at some point. That will tell us who really wins.”

Just like “Succession,” it’s not over until the main character passes away.
“This is a season finale, but not the series finale,” said Stelter.

The post The Toughest Act to Follow Is Rupert Murdoch | Analysis appeared first on TheWrap.