The chief executive of News Corp. in Europe and Asia, James Murdoch (L), escorts his father Rupert Murdoch (R), chairman of News Corp., on July 10, 2011 at his residence in London shortly after his arrival in Britain.
James Murdoch is getting out of the U.K. newspaper business. Shareholders in News Corp. will be hoping that he persuades his father Rupert, the company's chairman, to do the same.
Hereon, James is to focus on what was always evidently his preferred sector – broadcasting. He never clearly engaged with print, even though as executive chairman of News Corp.'s British arm he was responsible for the country's dominant newspaper group, including the now closed News of the World. At the beginning of the phone-hacking saga, which led to the paper's demise, James seemed reluctant to grab the affair by the scruff of the neck. When he did get stuck in, his lack of any sentimental attachment may have made it easier for him to respond to the scandal by closing the title.
If newspapers aren't the best fit with James's personal interests, the same goes for News Corp.'s business interests. The titles – the now seven-day Sun tabloid plus the Times and its Sunday sister paper – arguably once had strategic value in the hefty sway they gave the Murdochs in Britain. That was useful when News Corp. was building up his satellite television business, BSkyB. But Sky is now established, and the reality is that the Murdoch influence has been shot to pieces by recent events.
Moreover, attention is now turning to the Sun, following allegations of improper relations between journalists and British public officials. That may not put the title's future at risk, but it bolsters the argument that the British newspapers – which make a negligible financial contribution to News Corp. as a whole – would be worth more to another owner. Shedding them would draw a line under the crisis and remove a source of worry for investors. It's none of James's business now. Shareholders will hope that one day it's none of theirs.