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Will the breaking up of News Corporation herald a print-less future for Rupert Murdoch's empire?

By Warren Johnson

July 2, 2012 | 4 min read

Warren Johnson, founder of the PR agency W Communications, which counts The Independent, London Evening Standard and Hearst Magazines among its clients, believes the News Corporation split could lead to Rupert Murdoch surrendering his grip on the newspaper business.

Warren Johnson

Last week's announcement of the splitting up of News Corporation into two distinct print and entertainment business, whilst inevitable post hacking scandal, throws up a number of interesting questions for the media and PR industry. Might this lead to a possible sale of the News International business and if so who might buy it? Would a de-toxified News Corp entertainment business pave the way for Elisabeth Murdoch to return to the business, overtaking James as heir apparent?

Almost a year to the day that The News of the World printed its last issue, the split of the world's most powerful media company and its increasingly distant publishing and entertainment arms is the climax to an unprecedented period of scandal and adversity facing the UK print business.

Albeit under the guise of appeasing shareholders and maximising the profitability of both entertainment and print arms of News Corp, I can’t help but see a print-less future for Murdoch’s empire. Ben Fenton wrote in last week’s Financial Times that ‘the new publishing division will launch with no debt and $2bn of News Corp’s near $11bn cash hoard’. Whilst seemingly attractive, it’s obvious that, set against a backdrop of rapidly declining print sales and near-irrevocable reputational tarnish, the entertainment arm will reign supreme.

For Murdoch, it signifies a huge step back from his beloved publishing arm and what media analysts have referred to as an almost romantic attachment to his stable of British newspapers. Although he’s claiming that he will be ‘100% committed to the future of both the publishing and media and entertainment’, the two-fold empire is a far cry from the nostalgic days when News of The World raked in the profits.

This move cunningly ring fences the toxic fallout from the rest of News Corp. Despite Murdoch’s sentimental attachment it would certainly seem that if things get much worse a part or full sale would certainly not be ruled out. It may in due course allow them to revisit their failed BSkyB takeover. This would then set up the question of who might be in the running to buy the papers; several of which are losing significant amounts of money.

Given Murdoch’s determination to find a hereditary successor and James Murdoch’s poor handling of the crisis, a detoxified News Corp entertainment business would play to Elisabeth Murdoch’s strengths and overcome her issues with joining the business. This potentially makes her the heir apparent to her father’s throne.

Whatever happens next is more than likely to be a typical bold Murdoch move and have a significant impact on the UK media landscape.

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