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Murdoch’s Bid for the WSJ

The Financial Times's Alphaville looks at Murdoch's bid for the Wall Stret Journal:

FT Alphaville » Blog Archive » The $5bn question about Mr Murdoch’s desires : Some News Corp shareholders are privately furious about Mr Murdoch’s willingness to pay such a high price for what they see as “the media equivalent of a trophy wife”, notes the Economist in its latest issue. But... [i]f there is an occasional lack of clarity in [Murdch's] explanation of News Corp’s strategy, particularly its embrace of new media through acquisitions such as MySpace, there can be no doubting the excellence of that strategy in practice....

The Bancroft family, which owns a controlling stake through special voting shares, initially rejected Mr Murdoch’s bid. But the younger Bancrofts will soon be in the majority within the family, and are said to be lobbying their elders to swap shares for Mr Murdoch’s cash....

[W]hy does Mr Murdoch want Dow Jones? Simple. Mr Murdoch has long dreamt of owning a global business newspaper.... [T]here are fears he would undermine the editorial independence of the Journal’s news coverage, the magazine notes. With staggering faith in the moral compass of market forces, the Economist sanguinely concludes: “But he is certain to understand that excessive interference could tarnish the paper’s brand, the value of which comes from having wealthy readers who value honest journalism”....

If the deal goes ahead, it might turn out better than some News Corp shareholders fear. There are some synergies between News Corp and Dow Jones, as well as fairly similar cultures. Mr Murdoch may indeed “get” new media, and may have spotted lucrative opportunities within Dow Jones. If so, and if his bid succeeds, it would not be the first time he has proved his critics wrong.

There are people who fear that Murdoch would turn the Journal's news pages into the editorial pages--which would be a disaster. There are people who think that the editorial pages have estranged the younger Bancroft's from the organization: who, after all, can be proud of owning that? There are people who swear that the editorial page is the franchise--is a very profitable business play--because it gets the Journal an extra couple of hundred thousand daily subscribers--the "I never trusted that Communist Roosevelt" crowd.