The Wrong Man for Dow Jones
The sale of Dow Jones to Rupert Murdoch and his News Corp. global media giant would diminish the news quality and integrity of the Wall Street Journal and other Dow Jones publications and Internet services, as well as the independence of a leading national editorial voice.
The brand name, the major asset of Dow Jones, is based upon its reputation for, and daily practice of, accurate, objective and reliable business news reporting. It is this journalistic integrity that has created and will continue to create shareholder value. It would be damaged if Rupert Murdoch takes over Dow Jones.
In recent interviews about his offer, Murdoch said, "We are the sort of people with the same traditions that I think will prove great guardians for the paper."
That is not true. The Bancroft family tradition, since Clarence Barron bought Dow Jones in 1902, has been to hire first-rate managers and editors and let them run the company without family interference in editorial opinions or news coverage. The family influence on business decisions is exercised through its representatives on the Dow Jones board of directors.
Rupert Murdoch comes from a very different tradition of Australian-British media ownership and editorial practice. He has long expressed his political and business biases through his newspapers and television channels. We see this every day in his New York Post, which regularly runs biased news stories and headlines supporting his friends and public policies or attacking people he personally opposes. His Fox News Channel, run by former Republican Party strategist Roger Ailes, is a unique example in American broadcasting in which one man's political opinions have become the editorial and news policy of a national news channel.
I defend Murdoch's rights of free speech and press freedom. But I also defend the American journalistic tradition of a strict separation between political opinions expressed vigorously on editorial pages and news reported with as much factual objectivity as possible.
This is not an abstract principle. The unusual independence and high standards of journalism practiced at Dow Jones attract and motivate many of the nation's best reporters and editors. Investors and business and government leaders rely on its accurate and unbiased reports. This is Dow Jones's major asset -- which Murdoch's proposed ownership would threaten.
When Rupert Murdoch's business and news interests conflict, his business interests usually prevail. There is a clear conflict between his business interest in News Corp.'s Star TV broadcasts into the huge China market, where he has had to kowtow to government censorship, and the sharp criticism of Chinese violations of human rights, religious liberty and free speech that the Journal's editorial page has published. I doubt that freedom to criticize the Chinese government would continue under Murdoch's ownership.
I am opposed to Murdoch buying Dow Jones to boost his personal prestige and global media business control, or acquiring the Dow Jones brand because he needs it for his new business news channel to succeed. A takeover would add to the concentration of American and global media ownership, which is already too great, and which exercises too much political influence on American society and government decision making. The Economist describes Murdoch's pursuit of Dow Jones as "the media equivalent of a trophy wife."
Dow Jones publishes one of only three high-quality, national-impact newspapers still controlled by original family owners (the others are the New York Times and The Washington Post). They produce the best journalism because they are public companies controlled by families who protect their independence and high standards. News Corp. has a different agenda.
Murdoch promises editorial independence and no interference in news judgments if he were owner of Dow Jones. He has made but not always kept such promises before. And News Corp. is not a good long-term owner of Dow Jones. Murdoch, who is 76, has a history of disagreements with his sons, and arguments over ownership control and management influence among his children are inevitable.
Finally, there is no reason to sell Dow Jones. It is in a much better business and financial position than it was after the Internet market bubble burst in 2000 and a national decline in newspaper advertising cut its revenue and earnings. Its new and younger business and news management team is taking the company into the Internet age of information distribution. Dow Jones is strong financially and doing better than most publishing companies.
The important question should not be whether the right price is $60 a share for Dow Jones. The important question is: Why should Dow Jones be sold to anyone? It is not necessary for any internal business reason. The controlling shareholders of Dow Jones should answer News Corp.'s unsolicited offer by saying: "Dow Jones is not for sale, at any price, to Rupert Murdoch."
The writer retired in 2003 as senior vice president of Dow Jones and chairman of Ottaway Newspapers. He retired in April 2006 from the Dow Jones board after 17 years as a director. He owns or has voting power over 6.2 percent of Dow Jones Class B supervoting shares.