Some Thoughts on Rupert Murdoch and Dow JonesJon Fine
1. Anyone want to argue that News Corp. owning Dow Jones could be good for the Wall Street Journal and the company—or at least better than its management of the past several years? (UPDATE 5/2: Slate’s Daniel Gross did so here.) 2. I suspect Murdoch sees untapped global potential for the Journal, as both a print property and as a platform for more business TV.
3. This is an offer based on a new kind of media math. This is a price no newspaper company can approach. It’s, in fact, one that private equity guys will be hard-pressed to approach, judging by the 16.5 times ’07 EBITDA valuation that UBS analyst Michael Morris calculates Murdoch’s $60 per share offer is worth. If you’re a media company, you can only do this if you’ve got lots of cash in the bank. (Murdoch’s got around $4 billion). And if you’ve got a diverse set of assets that Dow Jones’ properties could bolster—like, say, an upcming launch of a cable business channel. And if you’ve got Internet pixie dust fizzing up a stock price.
4. Yahoo, here’s your big chance to bet big on content. (Or Microsoft. Or Google!)
5. I really dislike the Rupert-Murdoch-Is-The-One-Great-Man-of-Media storyline, but is there anyone who thinks that News Corp would not get substantially more for MySpace today than the $580 million they paid for it in 2005?
BusinessWeek made a video of my colleague Tom Lowry and I reacting to the news shortly after it broke, which can be found here.
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