The Man Who Owns the News (58 page)

Chernin’s reaction to Dow Jones:
Peter Chernin interview, January 18, 2008.

Peter Chernin and his kids don’t read newspapers:
Murdoch interviews, September 22, 2007, and October 23, 2007.

News Corp.’s Olympic book:
John Nallen interview, January 7, 2008.

Murdoch calls Elefante:
Murdoch interview, September 19, 2007. Bancroft and Dow Jones sources acknowledge the call took place, but cannot recall high fives.

Blind-sourced piece:
Steve Fishman, “The Boy Who Wouldn’t Be King,”
New York,
September 11, 2005.

Reorganizing the company around a crush:
Murdoch briefly gave up control of his European operations in the early 1990s to create a job big enough for Andrew Knight, the former head of the
Economist,
with whom he’d become smitten.

Murdoch meets Robert Thomson:
“I think someone mentioned him to me. Five or six years ago, it was when he just missed the editorship, because he was the staff candidate…And that he was unhappy and talked to CNBC, all right. And I just called him up and said, ‘Come and have a beer.’ And we met at the Dervish round the corner. And we had two or three subsequent meetings there.” June 2, 2008.

Fart joke:
Rebekah Wade: May 8, 2008

Thomson’s and Murdoch’s wives:
Wendi Murdoch is well aware of the rumors flying around News Corp. that her husband’s friendship with Robert Thomson is based on their younger Chinese wives, who were both pregnant when they met. “People say, ‘Oh, they hired Robert because he has a Chinese wife.’…Like we were best friends. No. I’m friendly with everybody’s wife. We see them a lot. She’s Chinese, so obviously we talk. Our children play together.” May 19, 2008.

CHAPTER
3

Andy Steginsky’s role:
Andrew Steginsky interviews, December 13, 2007 and May 23, 2008.

Murdoch on the phone:
“If I needed to talk to him you could always get him on the phone…no matter where he was he would take the phone calls. Rupert would take phone calls from people that he has no idea who they are. I mean, he is unbelievable in this way. The shoeshine boy called him up and he would take his phone call. That is part of his makeup, but if I get him a message that it’s important to speak to him, he’d either drop what he’s doing immediately or get right back to me. It’s never been an issue.” Senior News Corp. executive, June 3, 2008.

“I could make some calls”:
Conversation between Steginsky and Murdoch, as recalled by Rupert Murdoch, September 19, 2007.

“And so I hung up the phone”:
Andrew Steginsky interview, December 13, 2007.

“I would not underestimate the
Times
in that regard”:
Robert Thomson in conversation with author, November 15, 2007.

“She was an okay mother”:
Murdoch interview, March 21, 2008.

Dame Elisabeth’s reaction to Wendi:
Interviews with Murdoch family sources and News Corp. executives.

Dame Elisabeth interview,
February 25, 2008.

Murdoch ancestral history:
Shawcross,
Murdoch
, 29–46. (Also on the Free-churchers see: William D. Maxwell,
A History of Worship in the Church of Scotland
[New York, 1955], 59; A. MacKay,
Cruden and Its Ministers
[Adelaide, 1912]; A. Macdonald,
One Hundred Years of Presbyterianism in Victoria
[Melbourne, 1937]; C. McKay,
This Is the Life
[Sydney, 1961]; J. La Nauze,
Walter Murdoch
[Melbourne, 1977]; D. Zwar,
In Search of Keith Murdoch
[Melbourne, 1980].)

Keith Murdoch’s role in Gallipoli:
Knightley,
The First Casualty,
106–10.

“A newspaper is to be made to pay”:
Hamilton Fyffe,
Northcliffe: An Intimate Biography
, 83.

Murdoch’s childhood:
“The common theme in these stories, which are told affectionately, is power and denial,” Chenoweth,
Rupert Murdoch
, 37.

Sir James Darling apologizes:
Shawcross,
Rupert Murdoch,
54.

Murdoch attempts to buy school newspaper:
“I remember one specific occasion, a conversation I had with him when he was interested in the possibility of buying the undergraduate magazine
Cherwell
. That never came to anything, whether it would have anyway I don’t know, but I told him I thought
Cherwell
would never get enough advertising from the sort of ordinary university advertisers to make it profitable. And he was enthusiastic, as he always is. No doubt if he had got it he would have made it a much livelier magazine than it then was. I think he saw me probably as a potential investor. It would have been a very exciting project in his hands. Anyway he went down at the end of that year after his father died and it certainly never came to anything.” William Rees-Mogg interview, August 2008.

“It was very hard”:
Dame Elisabeth interview, February 25, 2008.

The history of the Fairfaxes:
John Fairfax—printer, bookseller, stationer, born in Warwick, England, in 1804—arrived in Sydney in 1838, not long after the arrival of Murdoch’s great-great-grandfather George Govett. Fairfax bought the
Sydney Herald
and quickly turned it into the most popular newspaper in the colony, changing its name in 1841 to the
Sydney Morning Herald
. Its values were Protestantism, the British monarchy, and free enterprise. It came to define the establishment—and was fondly called, for the next 150 years, the “Granny Herald.” It cemented its hold in the 1850s, Australia’s famous boom era, when gold was discovered. John’s sons, Charles and James, joined the firm and, in 1860, launched the
Sydney Mail
. The company passed to the first son, Charles, who died in 1863, falling from a horse, and then to James, who ran the paper for the next sixty-seven years and became arguably the most influential person in Australia. Certainly the
Sydney Herald
is unrivaled in its influence. It ranks with the greatest papers—the London
Times,
the
New York Times,
the
Wall Street Journal
—for its probity, respectability, and establishment snobbery. (It represents exactly the kind of elitism that Murdoch came to resent and covet.) Among them there was only one heir: Warwick Oswald Fairfax, who in 1926 become chairman at the age of twenty-five. The company’s real period of expansion happened after the Second World War, when it launched the
Australian Financial Review,
started the
Sun-Herald
and the
Sunday Morning Herald,
and bought Associated Newspapers, publisher of the afternoon
Sun
and various magazines after a takeover battle with Sir Frank Packer’s Australian Consolidated Press. In 1956, the Fairfaxes entered the television business, which they would come to dominate while continuing to make print acquisitions.

The history of the Packers:
R. C. Packer was a Sydney newspaperman who in 1918 lucked into a one-third interest in a new national periodical called
Smith’s Weekly,
which, with a populist tone and lots of pictures, was an instant success. Shortly thereafter, Packer and his partners launched the
Daily Guardian
in Sydney, a mass-market tabloid, which aped the Northcliffe techniques, at just the same time Keith Murdoch was aping them at the
Herald
in Melbourne. R. C. Packer was a notorious son of a bitch, as was his son Frank. In 1932, R. C. Packer, having sold his interests at great profit, became the top executive at Associated Newspapers, which owned Sydney’s sole afternoon paper, the
Sun
. Frank Packer, in a low-grade bit of deception, managed to make many people believe he was about to launch a competitor to the
Sun
. As it happens, he didn’t remotely have the money to do this. Nevertheless, his father paid him the equivalent of almost $4 million of Associated Newspapers’ money not to do what he, as it happens, could not have done. So it goes. With that dough, in 1933, Frank started
Women’s Weekly,
which would shortly become the largest-circulation magazine in Australia and the basis of his empire. There followed wild and successful expansion into newspapers, radio, and television.

Murdochs vs. Packers vs. Fairfaxes:
Right up until Murdoch’s son, Lachlan, and James Packer went head-to-head over Super League in the nineties, the families would try to take what belonged to the other. These were battles fought for business turf, for political influence, for strategic advantage—fought by families that were as intertwined and fundamentally alike as any could be. The only reason for the ritualized enmity, ruthless competition, and instinctive backstabbing was that it was a zero-sum game: Only one would prevail generations hence.

See Griffen-Foley, “The Fairfax, Murdoch and Packer Dynasties” Barry,
The Rise and Rise of Kerry Packer
.

Murdoch vs. Packer brawl:
“Kerry Packer: The
Times
Obituary,”
Times
(London), December 27, 2005.

Banking relationships:
Chenoweth,
Murdoch,
74–77; Shawcross,
Murdoch,
74–76.

Peter Kann lunch:
Interviews with former Dow Jones executives and Peter Kann, May 14, 2008.

Sulzberger’s offer reported:
Ken Auletta, “Family Business: Dow Jones Is Not Like Other Companies. How Long Can That Go On?”
New Yorker,
November 3, 2003.

Bancrofts’ learning of
New York Times
bid through
New Yorker,
reaction to share price, and family meetings:
Bancroft family member interview, May 28, 2008.

Kann pushing up his retirement:
Dow Jones executives and Bancroft family interviews.

Peter Kann wants to give his wife the top job:
Karen House denies she was interested in the job of chief executive. “I believe I was the most qualified person at Dow Jones to be publisher, and I was given that job. I had no interest in being CEO. I said that repeatedly in the presence of Rich and Gordon and Peter.” Peter Kann said she had informed the special committee appointed to look for his replacement and him about her lack of desire to be CEO. Karen House interview, June 25, 2008; Peter Kann interview, May 14, 2008.

Karen House, a figure of great contention:
Descriptions of House provided by Dow Jones executives and
Wall Street Journal
reporters in interviews. See also Katherine Q. Seelye, “Dow Jones Turns to Financial Side in Naming Its New Chief Executive,”
New York Times,
January 4, 2006.

Peter Kann’s succession:
A succession plan had been knocking around the company since the Telerate debacle in 1997. Bancroft family interviews.

Dow Jones directors meeting:
As described in interviews with Dow Jones executives and board members.

CHAPTER
4

Jimmy Lee introduces Murdoch to Richard Zannino:
Interviews with Murdoch, September 19, 2007; Lee, October 15, 2007; and Zannino, November 1, 2007.

Perceptions of Zannino:
Interviews with Dow Jones executives and
Wall Street Journal
reporters.

“shit-eating grin”:
Interviews with
Wall Street Journal
reporters.

“It wasn’t like you should work there”:
Bancroft family member, May 28, 2008.

Bancroft family history:
See Wendt,
Wall Street Journal.

Jane Bancroft’s oath:
Ibid., 235.

Nature of Bancroft trusts:
Interviews with Bancroft family members and their representatives.

Merrill Lynch presentation:
Interviews with Bancroft family representatives and Merrill Lynch advisors.

Hills thinking of suing:
Interviews with Bancroft family representatives, Murdoch, and Steginsky.

Murdoch on the Newhouses:
Murdoch interview, September 22, 2008.

Prue:
Prudence Murdoch interview, February 28, 2008.

Murdoch offers MacLeod a job:
“You tell Dad to get off my turf right now,” Prudence screamed at her father’s secretary, Dot Wyndoe, when she called to patch through Murdoch to his son-in-law about a job at the
Times
of London.

“…dirty old man”:
Australian Broadcasting Commission,
Inside the Murdoch Dynasty
, 2002.

Elisabeth attends Geelong Grammar:
Matthew Freud.

Elisabeth suspended for drinking:
When Prue’s oldest son, James, was suspended for drinking from school, she e-mailed her sister Elisabeth to say, “He’s following in your footsteps.” Elisabeth lectured James, “Don’t do what I did. It ruined my education. I never got over it.” But as Prue points out about her sister, named Business Woman of the Year by
Harper’s Bazaar
in 2008, “What a shocking life she’s had.” Prudence Murdoch interview, February 28, 2008.