Book Club: The Wall Street Journal Is Rupert Murdoch’s Crown Jewel

Rupert Murdoch listens to United States President Barack Obama make remarks at the Wall Street Journal CEO Council annual meeting, at the Four Seasons Hotel, on November 19, 2013, in Washington, DC. Obama discussed i... Rupert Murdoch listens to United States President Barack Obama make remarks at the Wall Street Journal CEO Council annual meeting, at the Four Seasons Hotel, on November 19, 2013, in Washington, DC. Obama discussed immigration reform and the health care rollout, among other topics. Credit: Drew Angerer / Pool via CNP Photo by: Drew Angerer/picture-alliance/dpa/AP Images MORE LESS
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When Rupert Murdoch bought the Dow Jones Company in late 2007, he did so to acquire its prized title, the Wall Street Journal. The Dow Jones newswires covered the world of business at a feverish pace, competing with Reuters and Bloomberg for scoops. But the Journal had global reputation and reach. It was prominent and widely circulated; it had among the most subscriptions of any paper in the US. Murdoch, like the other people populating the Forbes list of billionaires, relied on it religiously for news about business, finance, and the regulations that could affect commerce. The Journal became the jewel in the crown of Murdoch’s media empire. He loved owning it.

And yet Murdoch did not much like the Journal itself. Murdoch’s first editor at the Journal, Marcus Brauchli, had been installed less than a year before. Compact, fit, smart, with a sly smile and a deceptive wit, Brauchli had come up through the ranks at the Journal, making his mark in China and rising within the editing ranks to win the competition to replace the beloved Paul Steiger as managing editor.

Murdoch had his own ideas. He told Brauchli that readers resented setting aside editions with long pieces to digest later in the week because they felt rebuked by piles of unread papers. The feature called the “A-hed” had been a defining element of the Journal for decades—a front-page story that provided a great read about a development that was often of little or no immediate consequence. It was an innovation of the legendary Barney Kilgore, who reinvented the paper amid the chaos of the Great Depression. It was one of two narrative stories placed every day on the front page. The other often generated a behind the scenes look at corporate infighting or malfeasance. Murdoch seemed to suggest that both the A-hed and the daily in-depth piece should disappear.

Moreover, Murdoch had little tolerance for the “paywall” that required people to purchase a digital subscription to get access to the paper’s full site. Murdoch wanted anyone anywhere in the world to be able to read Journal stories at any time, on any device. What’s the point of doing all this fine journalism if people can’t see it? he wondered.

The Journal’s paywall was the envy of other newspaper owners, who felt they could not replicate the Journal’s value to entrepreneurs and investors. Executives at Dow Jones braced for the loss of revenue.

Early on, at a banquet dinner with bureau chiefs who had traveled to New York from all over the world, the chairman sketched out how he thought a story should be told: in “as few words as possible.” Murdoch underscored that these changes originated with him. His pick as publisher, Robert Thomson, told bureau chiefs that some projects celebrated in Journal’s newsroom had the “gestational period of a llama.” (Eleven-and-a-half months, if you were wondering.)

Consequently the Journal moved away from stories that deconstructed how business and the markets work—what editors called “how-why-will” stories. Investigative reporting, often strong, still arrived each day, or at least each week, but Thomson put less urgency on it. Thomson saw many reporters on the Journal staff as complacent, trapped in a mind-set defined by intellectuals and liberals on the Upper West Side and the Columbia Journalism Review.

Thomson’s opinions mattered. For though he had been named publisher of the Journal, rather than managing editor, it became clear that his editorial vision would guide the paper—which is to say, Murdoch’s vision would guide the paper.

Murdoch saw in Thomson a kindred spirit. The two families periodically vacationed together, with the Murdoch girls frolicking with the Thomson boys. Murdoch became not just Thomson’s employer and mentor, but by some accounts his best friend as well.

In summer 2007, as Murdoch put the final touches on a package to induce the controlling Bancroft family to sell him the Wall Street Journal and Dow Jones, he had to address the Bancrofts’ notions of editorial independence. Given the paper’s tenuous finances, the sale made financial sense but he had to overcome the Bancrofts’ pride. “They weren’t able to grow the company and lost interest in running it,” said Beijingbased reporter Ian Johnson, a Pulitzer Prize–winning chronicler of events in China for the Journal. He called the deal a Faustian bargain and campaigned with a small group of reporters against it. The Bancrofts saw their detachment as principled.

To ensure the newspaper’s integrity, Murdoch’s lawyers created a five-member panel, the Special Committee. It was to be constituted without any existing entanglements with News Corp or the Murdoch family. Chairman Thomas Bray had been a staffer for the Wall Street Journal, leaving in 1983, an affiliation that raised no hackles. MIT digital futurist Nicholas Negroponte, another member of the panel, however, had received $2 million from News Corp for the foundation he ran that gives laptops to needy schoolchildren. Those Journal reporters who opposed the sale to Murdoch seized on Negroponte’s affiliation as a sign the panel would be compromised. The veteran Journal reporter E.S. Browning told me at the time, “Murdoch clearly has no intention of creating a board that would be independent. He’s going to try to assault it with his lackeys.”

The Special Committee also included the former CEO of the Associated Press, the former editor in chief of the Chicago Tribune, and a former Republican congresswoman. News Corp expressed confidence that Negroponte had enough independence to act independently.

Given that News Corp and Murdoch were functionally the same, reporters and editors put little stock in the statement. But managing editor Marcus Brauchli vouched for Negroponte and the entire Rube Goldberg arrangement. We can work under Murdoch’s system, he told his staff. We can work with Murdoch. We need his riches to weather the storms slamming the economy and the industry.

Adapted from the book Murdoch’s World: The Last of the Old Media Empires by David Folkenflik. Excerpted by arrangement from PublicAffairs, a member of the Perseus Books Group. Copyright 2013.

David Folkenflik is an award-winning journalist who has been NPR’s media correspondent since 2004, and he previously covered media and politics for the Baltimore Sun. He edited the 2011 book, Page One: Inside The New York Times And The Future of Journalism. Folkenflik lives with his wife, the radio producer Jesse Baker, and their daughter in New York City.

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