Murdoch Rising

Rupert Murdoch looks like he just might pull off his attempt to buy Dow Jones and the Wall Street Journal.

I have been thinking all along that Murdoch was pulling a fast one and his worst-case scenario would be to draw out competitors to over pay for Dow Jones. That appeared to be the case, for a while, but now, Pearson and GE have retracted their joint bid. So, that leaves Rupe and Brad Greenspan, co-founder of MySpace, with bids on the table. Greenspan, who didn’t like the way the MySpace thing turned out has offered to buy a smaller 25 percent stake in the company for roughly the same value per share as Murdoch’s bid.

Meanwhile, there has been a lot of hype about a supposedly scathing investigation of Murdoch by the New York Times. Well, I just read the first installment of the Times piece and unless the follw-up uncovers some substantial mud, I think Murdoch is home free. The article focuses on Murdoch’s business dealings in China and this is the part that’s relevant to the Dow Jones deal.

In speeches and interviews, Mr. Murdoch often supports the policies of Chinese leaders and attacks their critics. A group of China-based reporters for The Journal accused him in a letter to Dow Jones shareholders of “sacrificing journalistic integrity to satisfy personal and political aims,” a charge the News Corporation denies.

The Murdochs often echoed the Chinese government line. In a 1999 interview with Vanity Fair, Mr. Murdoch spoke disparagingly of the Dalai Lama, whom the Chinese condemn as a separatist. “I have heard cynics who say he is a very political old monk shuffling around in Gucci shoes,” he said.

James Murdoch, who ran Star TV from 2000 to 2003, said in a speech in Los Angeles in 2001 that Western reporters in China supported “destabilizing forces” that are “very, very dangerous for the Chinese government.” He lashed out at the Falun Gong spiritual sect, which had just endured brutal repression in China, calling it “dangerous and apocalyptic.”

The Journal won a Pulitzer Prize for its coverage of the suppression of the Falun Gong movement in 2001. Last month, seven China-based reporters for The Journal wrote a letter to Dow Jones’s current controlling shareholders arguing that the articles on Falun Gong “may never have seen the light of day” if The Journal had been owned by Mr. Murdoch.

So, the Times found some reporters from the Journal that need to be placated. According to Reuters, Murdoch saw this coming.

A pact to protect the journalistic integrity is seen as the biggest hurdle to Murdoch’s unsolicited $5 billion (2.5 billion pounds) offer to buy the publisher of the venerable Wall Street Journal newspaper and owner of the Dow Jones Newswires.

Advisers for the companies met through the weekend and may be close to an agreement on editorial independence and integrity, the source said.

I have to hand it to Murdoch because there are, evidently, three dozen members of this Bancroft family involved in the controlling interest of Dow Jones. He has to have some serious political skill to get enough of them thinking on the same page long enough to work a deal.

If the Times comes out with some tabloid type, shocking revelations maybe that would be enough to get the Bancrofts fealing a little queasy. Otherwise, Murdoch gets one step closer to his quest for world media domination.