Intelligence without Surprise: Murdoch Wears His Strategy on his Sleeve
Jon Fine is the media critic for Business Week magazine. A couple of weeks ago, I found Jon Fine’s usually insightful column filled with teasers and questions for Rupert Murdoch and his purchase of Dow Jones – yet offering almost no answers of his own. As a pundit, Fine begs Murdoch to acknowledge the need to move his newest acquisition, The Wall Street Journal, into the digital age of the 21st century; at the same time, he offers no direction for Mr. Murdoch (or BW readers) to follow.
It seems to me that Murdoch instinctively knows exactly what he is doing, even if he does not have the precise roadmap as to how to get there. This is evident on a few fronts. I have run a series of public war games involving My Space and News Corp, in part to tease out News Corp’s strategic options. No matter what the game, the News Corp team always pulled the “content” card out of its deck. Content and figuring out ways to monetize that content is Murdoch’s end game. He doesn’t particularly care which vehicle he uses – newspapers, satellite TV, Internet.
In a recent Financial Times interview (May 2, 2007), Murdoch made this point – and the reason he so sought the Journal – abundantly clear: “The value of financial journalism, of high-quality journalism, is that you can charge for it…The WSJ and the FT I think are the only two papers in the whole world that charge for their online editions.”
Michael Bloomberg demonstrated with his Bloomberg terminals that if you can figure out how to charge for certain data, you can own a piece of the market. Why even Dow Jones, through its original Reuters-Dow Jones joint venture, Factiva, learned that it could package data and sell enterprise services to large corporations at a considerable profit. Dow Jones recently bought out Reuters’ stake in Factiva, which Murdoch now owns.
Murdoch is no fool. If I had to place a bet on his Dow Jones strategy is that it’s two-tiered: He will make money selling particularly hot business news at a business-class per-seat premium, then find a way for advertising to support the free versions sold to the masses.
Who know exactly what Murdoch is going to do? Certainly Fine doesn’t know, nor do I. But I can tell you, Murdoch is an aggressive, intuitive entrepreneur who follows his gut. I don’t think, as Mr. Fine does, that Murdoch may “let his love for newspapering in the 20th century get in the way of what Dow Jones needs to become in the 21st century.”
Murdoch is looking for premium data for which people are willing to pay. That’s his strategy. He may fail on MySpace or other ventures, but he doesn’t fail often. He knows that Content is King. That, Mr. Fine, is how he is going to make the Journal and his other properties succeed.
