Can we stop pretending Rupert Murdoch is some kind of biz genius?

Can we stop pretending Rupert Murdoch is some kind of biz genius?

Blog ››› ››› ERIC BOEHLERT

Because his money-losing ventures at the Wall Street Journal and New York Post should be all the proof any reporter needs before they type up another glowing profile of Murdoch.

The Times's media writers Tim Arango and Richard Perez-Pena actually inch in the right direction today with an article that details what a significant drag Murdoch's newspapers are on his larger News Corp. empire. They note, "His lifelong fondness for newspapers has become a significant drag on the fortunes of his company, the News Corporation."

And specifically, his 2007 purchase of the Journal looks like an historically bad move in retrospect:

Mr. Murdoch, chairman and chief executive of the News Corporation, paid more than $5 billion for an asset that generated about $100 million in operating income last year, a price that now looks like a staggering overpayment.

Honestly, even "staggering overpayment" doesn't really do justice to just how badly botched the Journal deal; a purchase that may go down as one of the worst in the history of modern media. Think about, Murdoch, in order to win over the Journal's previous owners, paid an absolute premium for the Journal just as the newspaper industry entered its cataclysmic advertising nosedive.

How much did Murdoch pay for the Journal and its parent company, Dow Jones? $65 a share. How much could Murdoch have paid for the Journal if he'd waited two years? (After all, it wasn't like anybody else was clamoring to buy the biz daily at the time.) He maybe would have paid between $10-$15 a share, and that's probably being generous.

Wonder how Murdoch's shareholders feel about that today.

Meanwhile, the New York Post continues to hemorrhage money, as the Times notes:

While Mr. Murdoch's personal attention has lately been on The Journal, the financial performance of the News Corporation's other newspapers is undergoing stricter scrutiny these days. For years, Mr. Murdoch has stomached tens of millions of dollars in annual losses at The New York Post, in exchange for the power the paper afforded him. But given the economic times and the shift of his attention to The Journal, there is a sense of urgency in the News Corporation executive suite about stemming The Post's losses.

I've estimated in the past that since purchasing the Post decades ago, Murdoch has lost nearly $250 million printing his beloved, money-losing tabloid.

Again, I wonder how his shareholders feel about that.

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