News Corporation

News Corporation (abbreviated News Corp. and also known as News Corporation Limited) was an American multinational mass media corporation founded and controlled by media mogul Rupert Murdoch. Founded on March 15, 1980 as News Corp Limited and formerly incorporated in Adelaide, South Australia, the company was re-incorporated under Delaware General Corporation Law on December 12, 2004, with headquarters at 1211 Avenue of the Americas in New York City.

Key Facts

Corporate Structure

News Corporation was the world’s largest media company in terms of total assets and the world’s fourth largest media group in terms of revenue prior to its split. The company dominated the news, television, film, and print industries across multiple continents.

Successors

On June 28, 2013, the original News Corp was split into two publicly traded companies: - 21st Century Fox - consisting primarily of media outlets including Fox Broadcasting Company and 20th Century Fox Film Corporation - News Corp (new entity) - formed to take on the publishing and Australian broadcasting assets

Major Holdings at Time of Split

Publishing

• News Limited (Australian newspaper publishers including The Australian)
• News International (UK newspaper publisher including The Times, The Sun, and the defunct News of the World)
• Dow Jones & Company (American financial news publisher including The Wall Street Journal)
• HarperCollins (book publisher)

Media/Entertainment

• Fox Entertainment Group (holding for 20th Century Fox Film Corporation and Fox Broadcasting Company)

Significance

News Corporation’s influence on global media was unprecedented. Under Rupert Murdoch’s leadership, it shaped political discourse, entertainment content, and news delivery across the English-speaking world and beyond. The company’s restructuring in 2013 marked the end of an era for one of the most powerful media conglomerates in history.

Background and Origins

Origins in Australia

News Corporation’s roots trace back to News Limited, founded in 1923 in Adelaide, South Australia by James Edward Davidson. The company was initially funded by the Collins House mining empire for the purpose of publishing anti-union propaganda. Subsequently, the controlling interest was bought by the Herald & Weekly Times.

In 1949, Keith Murdoch took control of Adelaide’s afternoon tabloid The News. When he died in 1952, his son Rupert Murdoch inherited a controlling interest in The News at the age of 21, setting the stage for what would become a global media empire.

Early Expansion

United Kingdom Entry

Rupert Murdoch began expanding his father’s holdings by acquiring struggling newspapers in the United Kingdom: - Purchased News of the World in 1969 - Acquired The Sun in 1969, transforming it into a tabloid format

These acquisitions established Murdoch’s reputation for revitalizing newspapers through controversial editorial approaches and populist appeal.

United States Expansion

News Ltd. made its first acquisition in the United States in 1973: - Purchased the San Antonio Express and News (the two papers merged in 1984) - Founded the National Star, a supermarket tabloid - In 1976, acquired the New York Post from Dorothy Schiff for $31 million

Formation of News Corporation (1980)

On March 15, 1980, Rupert Murdoch established News Corp Limited as a holding company for News Limited. This formal corporate structure enabled more aggressive expansion and the ability to acquire larger media assets globally.

Corporate Reorganization (2004)

Following a successful shareholder vote on November 12, 2004, the company was re-incorporated under Delaware General Corporation Law. This move: - Simplified the corporate structure - Enhanced access to U.S. capital markets - Consolidated control under the Murdoch family - Established headquarters at 1211 Avenue of the Americas in New York City

Strategic Philosophy

Murdoch’s approach to media ownership was characterized by: - Vertical integration - controlling content from creation to distribution - Cross-promotion - using various platforms to support properties - Political influence - leveraging media outlets to shape public opinion - Global reach - establishing presence in major English-speaking markets

Family Control

The Murdoch family maintained tight control over the company through: - Dual-class share structure giving the family 39% voting power - Rupert Murdoch serving as both Chairman and CEO for over three decades - Succession planning involving his children in various executive roles

Predecessor Company

News Corporation’s predecessor was TCF Holdings, which held stakes in 20th Century Fox. This connection to the film industry would prove crucial to the company’s later entertainment empire.

Career and Company Development

The 1980s: Building an Empire

Major Acquisitions

1984-1985: Film and Television Entry - Acquired the Chicago Sun-Times from Field Enterprises for $90 million (later sold in 1986) - Purchased Travel Weekly and other trade magazines from Ziff Davis - In March 1985, bought a 50% stake in TCF Holdings (holding company of 20th Century Fox) from Marc Rich for $162 million - Acquired remaining 50% stake from Marvin Davis in September 1985 for $325 million

1985: Broadcast Network Launch On May 6, 1985, News Corp announced the purchase of Metromedia television stations and its syndication arm Metromedia Producers Corporation from John Kluge for $3.5 billion. This acquisition set the stage for launching the Fox Broadcasting Company, the fourth major U.S. commercial television network.

Fox Broadcasting Company

The Fox network launched in 1986, challenging the “Big Three” networks (ABC, CBS, NBC). Through aggressive programming including: - The Simpsons (1989) - Married… with Children - Beverly Hills, 90210 - The X-Files - American Idol

Fox grew to become a legitimate competitor to the established networks.

The 1990s: Global Expansion

Satellite Television

News Corp became a pioneer in satellite broadcasting: - Sky Television (UK) - launched in 1989, merged with British Satellite Broadcasting to form BSkyB in 1990 - Foxtel (Australia) - joint venture with Telstra - Star TV (Asia) - pan-Asian satellite service acquired in 1993 - DirecTV - U.S. direct broadcast satellite service (later sold)

Sports Broadcasting

Recognizing the value of live sports content: - Acquired broadcast rights to NFL football for Fox network in 1993 - Purchased Los Angeles Dodgers (1998-2004) - Acquired stake in various regional sports networks

Digital Ventures

Early internet investments included: - Purchase of Delphi Internet Services - Launch of various online properties - Investment in digital media platforms

The 2000s: Consolidation and Crisis

Major Corporate Moves

2005: Dow Jones Acquisition News Corp acquired Dow Jones & Company, publisher of The Wall Street Journal, for $5 billion. This added the premier financial news organization to the company’s portfolio.

2007: Financial Services The company expanded into financial data services, complementing its Dow Jones acquisition.

The Phone Hacking Scandal

Beginning in 2005 and coming to a head in 2011, the News of the World phone hacking scandal severely damaged the company: - Revelation that journalists had hacked into voicemail accounts of celebrities, politicians, and crime victims - Closure of News of the World in July 2011 after 168 years of publication - Multiple arrests of executives and journalists - Parliamentary investigations - Withdrawal of BSkyB takeover bid - Damage to corporate reputation and relationships with UK regulators

Corporate Governance

Leadership Structure

Board Composition

The Board of Directors included media industry veterans, business leaders, and Murdoch family members. The company’s dual-class share structure ensured Murdoch family control while allowing public investment.

Regulatory Challenges

Throughout its history, News Corporation faced numerous regulatory challenges: - FCC ownership rules - Navigating limits on broadcast station ownership - Cross-ownership restrictions - Managing newspaper and broadcast combinations - Foreign ownership limitations - Addressing restrictions on non-U.S. citizens owning broadcast licenses - Antitrust concerns - Multiple investigations into market dominance

Key Competitors

News Corporation competed with major media conglomerates including: - Time Warner (now Warner Bros. Discovery) - Disney - Viacom - Comcast/NBCUniversal - Bertelsmann

Financial Performance and Growth

Revenue and Market Position

News Corp’s financial trajectory reflects a story of growth, innovation, and strategic positioning within their industry. Key financial metrics demonstrate the company’s strength and market relevance.

Investment and Funding

The financial backing and investment strategy behind News Corp has played a crucial role in enabling the company’s growth and competitive positioning in a rapidly evolving market.

Economic Impact

News Corp’s operations generate significant economic activity, creating jobs, driving innovation, and contributing to the broader economic ecosystem in which it operates.

Financials

Revenue and Performance

News Corporation was one of the largest media companies in the world by revenue. Prior to its 2013 split, the company reported annual revenues exceeding $33 billion.

Revenue by Segment (Pre-Split)

Key Financial Milestones

1985: Metromedia Acquisition - $3.5 billion purchase of television stations - Funded through debt financing - Created foundation for Fox Broadcasting

1985: 20th Century Fox Acquisition - Total investment approximately $487 million - Combined 50% stakes purchased from Marc Rich and Marvin Davis - Provided entry into major studio film production

2005: Dow Jones Acquisition - $5 billion purchase price - $60 per share (67% premium over market price) - Added premier financial news brand to portfolio

2005: MySpace Acquisition - $580 million purchase price - Peak valuation of approximately $12 billion (2007) - Eventually sold for $35 million in 2011

Stock Performance

Trading Information

Share Structure

The company utilized a dual-class share structure: - Class A Shares: Non-voting, publicly traded - Class B Shares: Voting control, primarily held by Murdoch family - Murdoch family maintained approximately 39% voting power despite owning smaller economic stake

Major Transactions

Acquisitions

Divestitures

Financial Challenges

Phone Hacking Scandal Costs (2011-2013)

The News of the World phone hacking scandal resulted in substantial financial impacts: - Legal settlements and defense costs - Closure of News of the World (loss of profitable asset) - Abandoned BSkyB takeover bid (opportunity cost) - Reputational damage affecting advertising revenue - Management changes and restructuring costs

Write-Downs

• MySpace: Significant impairment charges as social network declined
• Publishing assets: Write-downs reflecting industry challenges
• Acquisition goodwill: Periodic impairment testing led to adjustments

Dividend Policy

News Corporation maintained a consistent dividend policy throughout its existence, distributing profits to shareholders while reinvesting in growth opportunities. The dividend provided steady returns despite stock price volatility.

Executive Compensation

Rupert Murdoch Compensation

As Chairman and CEO, Murdoch received: - Base salary - Performance-based bonuses - Stock options and equity awards - Use of corporate aircraft and other perks

Total compensation regularly placed Murdoch among the highest-paid executives in media, though often below leaders of larger technology companies.

Shareholder Returns

Long-term Performance

Over its 33-year existence (1980-2013), News Corporation delivered substantial returns to shareholders: - Significant stock price appreciation - Consistent dividend payments - Strategic splits creating separate investment opportunities

The 2013 Split Value Creation

The split into 21st Century Fox and new News Corp was designed to: - Unlock shareholder value through focused businesses - Separate growth entertainment from challenged publishing - Allow investors to choose exposure to different media segments - Enable clearer strategic direction for each entity

Post-Split Valuation

Following the 2013 split: - 21st Century Fox: Valued based on entertainment assets, sports rights, and cable networks - New News Corp: Valued on publishing assets, Australian properties, and real estate

Combined market capitalization of the two entities exceeded the pre-split valuation, validating the separation strategy.

Controversies and Challenges

Overview

News Corp has faced various controversies and challenges throughout their history. These episodes have tested their resilience and shaped their public perception.

Key Points

The details of this aspect of News Corp’s story reveal important dimensions of their character, achievements, and impact. Understanding these elements provides a more complete picture of News Corp’s significance.

Significance

This dimension of News Corp’s life and work contributes to the larger narrative of their enduring importance and continuing relevance in the modern world.

Legacy and Lasting Impact

Overview

News Corp’s legacy endures as a testament to their extraordinary contributions. Their influence continues to shape their field and inspire new generations who follow in their footsteps.

Key Points

The details of this aspect of News Corp’s story reveal important dimensions of their character, achievements, and impact. Understanding these elements provides a more complete picture of News Corp’s significance.

Significance

This dimension of News Corp’s life and work contributes to the larger narrative of their enduring importance and continuing relevance in the modern world.

Legacy

Transformation of Global Media

News Corporation’s 33-year existence fundamentally reshaped the global media landscape. Under Rupert Murdoch’s leadership, the company challenged established hierarchies and created new models for media ownership, production, and distribution.

Industry Restructuring

Broadcast Television: - Fox Broadcasting Company became the first new major U.S. network in decades - Proved that a fourth network could compete with ABC, CBS, and NBC - Innovations in programming challenged broadcast standards - Changed advertising and affiliate relationships

Cable News: - Fox News Channel created the partisan cable news model - Demonstrated that perspective-driven news could achieve ratings dominance - Influenced competitors to adopt similar approaches - Transformed political discourse through media

Film Industry: - 20th Century Fox remained a major Hollywood force - Blockbuster franchises redefined film economics - International distribution capabilities expanded Hollywood’s global reach - Technological innovations in digital cinema

Print Media: - Tabloid journalism techniques applied to broadsheet newspapers - Cost-cutting and restructuring of traditional publications - Digital transition strategies (with mixed success) - Preservation of major journalistic brands

Political Influence

Direct Impact

News Corporation properties influenced politics in multiple countries:

United Kingdom: - The Sun claimed credit for election outcomes - Close relationships with Prime Ministers Thatcher, Blair, and Cameron - Phone hacking scandal damaged political-media relationships - Regulatory capture concerns

United States: - Fox News became the primary news source for conservative audiences - Editorial positions influenced policy debates - Political fundraising and advocacy through media platforms - 2010s polarization partly attributed to partisan media

Australia: - Dominance of print media market - Influence on national political agenda - Climate change coverage affecting policy - Support for conservative governments

Democratic Implications

The company’s legacy includes debates about: - Media concentration and democratic discourse - Partisan journalism versus objective reporting - Corporate influence on political processes - Balance between press freedom and accountability

Business Model Innovations

Vertical Integration

News Corp pioneered modern media vertical integration: - Content creation across multiple formats - Distribution through owned platforms - Cross-promotional capabilities - Global coordination of properties

Globalization Strategy

The company demonstrated how media could operate globally: - Same brands across multiple continents - Local adaptation of global content - 24-hour news and entertainment cycles - Cultural export through entertainment

Financial Engineering

Innovations in media finance: - Dual-class share structures for family control - Strategic use of debt for acquisitions - Asset separation to unlock value (2013 split) - Management of declining assets alongside growth businesses

Cultural Impact

Entertainment Content

News Corporation properties shaped popular culture:

Television: - The Simpsons became a cultural institution - American Idol launched the modern reality competition format - Fox Sports changed sports broadcasting - Adult animation and edgy comedy became mainstream

Film: - Star Wars franchise under Fox distribution - Avatar pushed technological boundaries - Titanic demonstrated global box office potential - Blue Sky Studios animated features

Publishing: - HarperCollins published influential contemporary literature - The Wall Street Journal set business journalism standards - Tabloid culture influence on celebrity coverage

Controversies and Criticisms

Phone Hacking Scandal

The company’s most significant legacy includes: - Closure of News of the World after 168 years - Criminal prosecutions of journalists and executives - Parliamentary investigations and regulatory reforms - Damage to journalistic credibility

Media Ethics Concerns

Ongoing debates about: - Balance between public interest and privacy - Commercial pressures on editorial independence - Accuracy and sensationalism in news coverage - Corporate accountability in media

Market Power

Antitrust and competition concerns: - Media ownership concentration - Barriers to entry for competitors - Influence on advertising markets - Platform power in content distribution

Organizational Legacy

Management Precedents

News Corp established models for: - Family-controlled public companies - CEO dominance in media organizations - Succession planning in family businesses - Crisis management in public companies

Industry Talent

The company developed media executives who: - Moved to leadership roles at competitors - Started independent ventures - Influenced industry practices - Shaped media education

Successor Organizations

21st Century Fox (2013-2019)

The entertainment-focused successor: - Continued as major Hollywood studio - Sold to Disney in 2019 for $71.3 billion - Fox Corporation spun off with broadcast and news assets - Demonstrated value of the original News Corp strategy

News Corp (Post-2013)

The publishing-focused successor: - Continued newspaper and publishing operations - Expanded into real estate information services - Adapted to digital disruption challenges - Maintained Murdoch family control

Fox Corporation (2019-present)

Current successor: - Fox Broadcasting Company - Fox News Channel and Fox Business - Fox Sports - Tubi streaming service

Historical Assessment

Achievements

News Corporation’s positive legacies include: - Breaking monopolies in broadcast television - Innovations in cable programming - Global distribution of entertainment - Preservation of journalistic institutions during industry transition - Demonstrating viability of global media conglomerates

Shortcomings

The company’s legacy also includes: - Ethical lapses in journalism practice - Contribution to political polarization - Concentration of media power - Failed digital ventures (MySpace) - Cultural homogenization concerns

Influence on Media Studies

News Corporation became a case study for: - Media ownership and democracy - Globalization of cultural industries - Family business management - Media ethics and responsibility - Digital disruption of traditional media

Conclusion

News Corporation’s legacy is complex and contested. The company simultaneously: - Democratized access to information and entertainment - Concentrated unprecedented media power - Innovated in content creation and distribution - Compromised journalistic standards for commercial gain - Shaped political discourse for decades - Created enduring cultural touchstones

The company’s 2013 split acknowledged that the synergies between newspapers and entertainment had diminished, but both successor companies continued to wield significant influence. News Corporation’s 33-year history demonstrated both the possibilities and the perils of global media conglomeration, leaving a lasting imprint on how information and entertainment are produced, distributed, and consumed worldwide.

Rupert Murdoch’s creation fundamentally changed media industries, political communication, and popular culture. Whether viewed as visionary entrepreneurship or dangerous concentration of power, News Corporation’s legacy is inescapable in understanding modern media.