Wall Street Journal

The Wall Street Journal And Network Neutrality

Posted by on December 16, 2008 at 2:18 am. NO Comments :

An article in the Wall Street Journal is reporting that prominent advocates of Network Neutrality are reversing or softening their positions on the concept of treating all Internet traffic equally. The authors go into some depth in support of their contention that the movement is losing steam. And they name names.

“Google Inc. has approached major cable and phone companies that carry Internet traffic with a proposal to create a fast lane for its own content…”

“Microsoft Corp. and Yahoo Inc. have withdrawn quietly from a coalition formed two years ago to protect network neutrality.”

“In addition, prominent Internet scholars, some of whom have advised President-elect Barack Obama on technology issues, have softened their views on the subject.”

“Lawrence Lessig, an Internet law professor at Stanford University and an influential proponent of network neutrality, recently shifted gears by saying at a conference that content providers should be able to pay for faster service.”

Unfortunately for the WSJ, almost everyone they cite denies the conclusions the article draws and affirms their commitment to Network Neutrality.

Google: Despite the hyperbolic tone and confused claims in Monday’s Journal story, I want to be perfectly clear about one thing: Google remains strongly committed to the principle of net neutrality, and we will continue to work with policymakers in the years ahead to keep the Internet free and open.

Barack Obama: The Obama transition team is reaffirming his complete commitment to net neutrality and is disputing a much-discussed report today claiming that the President-elect is softening his support for it or shifting his position on it.

Lawrence Lessig: I don’t know what Google is doing, though if they are trying to negotiate exclusive deals for privileged access, that shows exactly why we need network neutrality regulation […] I’ve not seen anything during the Obama campaign or from the transition to indicate it has shifted its view about network neutrality at all.

Perhaps the only position correctly reported in the WSJ story is that Yahoo and Microsoft have strayed from the pro-Network Neutrality crowd. However, that separation occurred two years ago when they tightened their relationships with Telecom companies and was therefore, not a new development as the Journal implied.

So why would the Journal so badly mangle this story? They obviously didn’t bother to seek comments from the people or companies they quoted. Reporting the accurate positions of these parties would not have been difficult to do. Instead, the misquoted parties had to find other forums to set the record straight after the Journal had already hit the streets.

It would be easy to blame this shoddy work on the new Wall Street Journal as envisioned by its new owner, tabloid merchant Rupert Murdoch. But it goes deeper than that. The main companies that oppose Network Neutrality are the big Telecom and Cable businesses. Murdoch’s News Corp is heavily dependent on them for distribution of his television networks. He launched his Fox Business Network one year ago and it is still struggling for carriage. It presently passes less than half the homes of its primary competitor, CNBC. Do you think that Murdoch might be interested in getting AT & T, Comcast, Time Warner, etc., to put FBN on all of their systems? Do you think that he might like to get favored treatment and channel space for Fox News, FX, Fox Sports, National Geographic, and the rest of his cable properties?

And the big question: Do you think that Murdoch would use his Wall Street Journal to lobby for the interests of his other business assets? Of course he would – he’s Rupert Murdoch.

The Wall Street Journal After A Year With Murdoch

Posted by on December 13, 2008 at 2:30 pm. NO Comments :

It was one year ago today that the Dow Jones Company, parent of the Wall Street Journal, agreed to be acquired by Rupert Murdoch’s News Corp. That transaction marked another step in the shrinking universe of media ownership. Specifically, it was the consumption of a revered publishing institution by a voracious international megalopoly. So what did the Bancroft family and other shareholders get for their greedy acquiescence to the power-mad mogul?

One year ago, the $60.00 per share offer from News Corp was about a 67% premium over Dow Jones’ then current price. Anyone who immediately liquidated their holdings following the transaction (which no one did) would have made a nice profit. Everyone else just watched as their fortunes shriveled up. The parent of Fox News has declined 60% in the past year. That means that the $5 billion dollars spent on Dow Jones has a current value of $2 billion. That’s not a particularly impressive performance.

As for Murdoch’s financial fate, rather than adding a $5 billion asset to his empire, his company’s market cap declined $32 billion – that’s more than six times what he spent on Dow Jones.

Now it would be easy to blame this all on the economic collapse, and certainly that plays a significant part. The only problem is that News Corp fell further than any of its competitors.

Company % Decline
News Corp 60
New York Times 55
Washington Post 50
Time Warner 44
Dow Jones Index 35
Disney 29

From a financial perspective, it doesn’t appear that the folks at Dow Jones made a particularly sound decision. While it’s impossible to say where these investments would be had News Corp not come along, it seems that they would have done no worse than the rest of the field. The difference is that they would still have their independence. They would not have had their publisher replaced by a Murdoch loyalist from England. And they would not have been ordered to shorten their stories and shift their focus from business to general news so that Murdoch could taunt his enemies at the New York Times (which he is also now rumored to fancy).

Murdoch’s business prowess is widely exaggerated. His New York Post has lost money for the past decade – the whole time he has owned it. And his celebrated purchase of MySpace when it was the unchallenged leader in social networking, hasn’t really worked out so well. MySpace is now second to a surging Facebook. Fox News itself is consistently the slowest growing news network on cable TV.

The biggest advantage for a Dow Jones tie in with News Corp was the potential for a television platform. The Wall Street Journal badly missed out by allowing CNBC and Bloomberg to run away with that market. Murdoch of course has his new Fox Business Network, but due to contractual commitments with CNBC, he is not permitted to use the DJ assets. And by the time those contracts expire, the dismally low-rated FBN may be history.

So…all in all, Dow Jones probably would have been better off if they had left well enough alone. They lost some prominent and experienced talent when Murdoch took over. And although he is moving slowly, so as not to spook his staff and subscribers, we can still expect him to put his personal stamp on the enterprise by dumbing down the content to reach a broader market. That’s been his M.O. throughout his entire career and there are no signs that he is abandoning his affection for tabloid sensationalism and rightist propaganda.

Happy Birthday Fox Business Network

Posted by on October 15, 2008 at 3:52 am. 7 Comments :

Today is the first anniversary of the debut of the Fox Business Network, Rupert Murdoch’s newest propaganda platform. Ratings for the network are still so low that, even after a year, Nielsen cannot certify their reliability and they are not published. When numbers were leaked earlier this year they revealed a pitiful performance that drew only 8,000 daytime viewers, and 20,000 in prime time. CNBC, by contrast, drew an average of 284,000 viewers during the day and 191,000 in prime time.

This hasn’t stopped Murdoch from pursuing his ambition for a business channel that would be…

“…more business-friendly than CNBC. That channel leap[s] on every scandal, or what they think is a scandal.”

Ironically, the network that was hatched to put a rosy hue on business news appears to have had the opposite effect on the financial world into which it was born. The week that FBN launched the Dow Jones was at an all-time high. Since then the Dow, which also became the property of Murdoch when he purchased it along with the Wall Street Journal, has plummeted 33%.

Is it mere coincidence that the markets went straight down immediately after having been touched by Murdoch’s bony, demon finger? The first week that FBN was on the air the Dow dropped over 500 points. That should have served as a warning of the devastation yet to come.

On July 13, 2007, FBN’s Managing Editor, Neil Cavuto, disputed reports of the economy’s weakness saying that he “[didn’t] believe a word of it.” Cavuto previously downplayed the significance of the credit crunch, saying that, because “this ‘meltdown’ affects roughly 4 percent of all mortgages out there” there wasn’t really any problem at all. He then blamed market declines on John Edwards, who was running a distant third in the Democratic primaries at the time, but apparently still had superhuman powers over the stock market.

Cavuto’s colleague, Bill O’Reilly, recently asserted that the market was tanking because traders were pricing in a presumed Obama victory in November. [For the record, the market has performed better during Democratic administrations than Republicans for the past 107 years. And investments accrue more under Democrats]. O’Reilly also has a spotty record of financial analysis. He lambasted General Electric’s CEO, Jeffrey Immelt, with whom O’Reilly is obsessed, saying that he didn’t know how Immelt kept his job after GE’s stock dropped 36%. But O’Reilly must not have noticed that News Corp., the parent of Fox News was itself down 38% – even worse than GE. Maybe he should be asking how Murdoch keeps his job.

So in honor of FBN’s first birthday, investors and news consumers should be aware that this is the sort of credibility you can expect from Fox News and FBN which calls itself: The Network You Can’t Afford To Miss. It’s more like: The Network You Can’t Afford To Watch.

The Wall Street Journal: Rupert Murdoch’s Bitch

Posted by on July 30, 2008 at 7:44 pm. NO Comments :

Today’s Wall Street Journal published an editorial castigating FCC chairman Kevin Martin. Normally, that would be an unexpected and pleasant surprise. Martin’s tenure at the FCC has been a gift to Big Media, allowing them to consolidate at will and presiding over a deregulation fest that has benefited everyone but consumers.

However, the reasons for the Journal’s pique are more typical of their reputation for greed and self-interest. The FCC is reportedly prepared to rule against Comcast for blocking legal access to the Internet. At Save the Internet, Craig Aaron has nicely documented Comcast’s violations and laid out the myths versus the realities of Network Neutrality. But that’s not the end of the story.

For the Journal to take up this issue now, they are treading deeply into some serious conflict of interest. Rupert Murdoch’s News Corp. purchased the Journal last year. The center of News Corp’s universe is Fox News – a cable network. Cable networks depend on carriage from cable operators like Comcast. Murdoch also owns a new cable operation, the Fox Business Network, which is gasping for viewers largely because they lack carriage on enough cable systems to stay afloat.

Now the Journal is coming to the rescue of Comcast. Is Murdoch attempting to curry favor with Comcast, and the cable industry in general, in order to secure more channel space? Does a pimp want to get paid? The ferocity of the Journal’s attack on an otherwise uber-loyal Republican appointee tells the story. The column starts out swinging:

“Bad personnel decisions have haunted the Bush Administration, and one of the bigger disappointments is Federal Communications Commission Chairman Kevin Martin. In his last months as Master of the Media Universe, he seems poised to expand government regulation of the Internet.”

That’s the sort of rancid rhetoric that the Journal usually saves for Democrats. On that measure, the Journal doesn’t disappoint. Delivering what must be the ultimate insult to a right-wing toady, the Journal suggests that Martin is “greasing the skids for a potential Barack Obama Administration.” Remember, we’re talking about a man so devoted to the rightist agenda that he was over-ruled twice by Congress. He never saw a merger he didn’t like. He got his job as a reward for helping Bush steal the Florida election in 2000.

Martin is not the typical target of the Journal’s scorn. But if it means consolidating more power, and making more money, Murdoch will use his house organ to achieve whatever ends he desires. Even if it means beating up one of his prized whores. It’s hard out here for a pimp.

Murdoch Stalking Newsday

Posted by on April 23, 2008 at 2:48 pm. 1 Comments :

Rupert Murdoch is on the prowl again and the editors, employees and readers of Long Island’s Newsday had better pay attention. The News Corp. chief has announced that his ravenous appetite for world media dominance is far from satisfied.

“Media mogul Rupert Murdoch has been calling key state and local officials to say he is close to a deal to buy Newsday and that he looks forward to working with them.”

Murdoch already owns the New York Post, the Wall Street Journal, and two TV stations in the New York market, along with the Fox News Channel, and the Fox Business Network. The $580 million acquisition of Newsday would allow him to further tighten his grip on the biggest media market in the country. Murdoch hopes that by adding Newsday to his empire he might be able to reduce the debt he takes on from the Post, which has lost money for as long as he’s owned it. This would sharpen his aim at his real target, the New York Times, which he has previously vowed to bury.

As for the Newsday staff and customers, they need to be aware of what lay in store if Murdoch is successful. Despite having promised not to meddle in the editorial affairs of the Wall Street Journal as a condition for his purchasing it, his will cannot be denied.

“Marcus W. Brauchli will step down as the top-ranking editor of The Wall Street Journal after less than a year in the job, four people briefed on the matter said on Monday, just four months after Rupert Murdoch took control of the paper.”

As with most of the rest of Murdoch’s properties, Newsday would likely take on his world view. However, Newsday’s fate is not a foregone conclusion. Mort Zuckerman, who owns the New York Daily News, is reportedly preparing his own bid. This may be less because of his desire to own Newsday than his need to keep Murdoch from owning it. Whatever the reason, it may be time to start rooting for Zuckerman.

Wall Street Journal Squelches Parody

Posted by on April 18, 2008 at 12:28 am. NO Comments :

A parody of the Wall Street Journal has the Wall Street Journal up in arms. When copies of the parody appeared at newsstands, so did a Journal operative who insisted on buying every last one.

“He grabbed them all, said, ‘I need to buy all of these,'” Mr. Laurence said. “He had been going around to different stands, buying them.”

Is this just another demonstration of Rupert Murdoch’s commitment to honest journalism and free expression? Or is Murdoch merely exercising his business reporting philosophy as told to his former editor Harold Evans (Good Times, Bad Times):

“What do you want this crap for, anyway? Two pages is plenty for business news.”

This is the man who just joined the board of the Associated Press.

Poor Rupert: Nobody Listens To Him

Posted by on November 26, 2007 at 5:22 pm. 2 Comments :

As if any further evidence was required, we now have it straight from Rupert Murdoch’s own pursed lips that the fingers of his bony hand are pulling the strings at his media properties and setting editorial policy. Murdoch was interviewed by the British House of Lords’ Communications Committee as part of its inquiry into media ownership. The committee released these comments from the interview:

“For The Sun and News of the World, he explained that he is a ‘traditional proprietor.’ He exercises editorial control on major issues – like which party to back in a general election or policy on Europe.”

“He distinguishes between The Times and The Sunday Times and The Sun and the News of the World (and makes the same distinction between the New York Post and The Wall Street Journal).”

The way that Murdoch distinguishes between his various properties is that those for which he has legal or contractual barriers to direct manipulation he doesn’t tell them what to do, he merely asks them what they are doing. Is there any employee that would not know what his boss means to convey under such an arrangement? It also goes without saying that Murdoch doesn’t have to give much guidance to managers he selected precisely because of their fealty to his interests. In fact, he has already tapped his long-time editor at the London Times to be the new publisher at the Wall Street Journal.

Murdoch also expressed his opinion that his Sky News “could be more popular if it emulated his Fox News Channel.” He said that the reason it isn’t already doing that is because “nobody at Sky listens to me.” That’s especially funny when you consider that Sky News is run by James Murdoch, Rupert’s son.

Here in the U.S., Murdoch took a glancing blow from his beneficiary, Hillary Clinton. At a campaign stop in Iowa, Clinton was asked about media consolidation and the risk of having one man like Murdoch with so much control. Clinton responded that…

“There have been a lot of media consolidations in the last several years, and it is quite troubling. The fact is, most people still get their news from television, from radio, even from newspapers. If they’re all owned by a very small group of people – and particularly if they all have a very similar point of view – it really stifles free speech.”

That’s a good answer and Clinton is commendably a co-sponsor of the Media Ownership Act of 2007. Too bad she had to dilute the impact of her response by letting Murdoch off the hook:

“I’m not saying anything against any company in particular. I just want to see more competition, especially in the same markets.”

Murdoch, his son James, and several other executives at News Corp have contributed to Clinton’s senatorial and presidential campaigns. I would sure hate to think that those contributions might affect her decision making with regard to Big Media.

Murdoch On Murdoch

Posted by on June 30, 2007 at 3:41 am. NO Comments :

Time Magazine joins the rush to profile the 21st century’s Minister of Propaganda, Rupert Murdoch. In case you missed it, the Wall Street Journal, the New York Times, Slate, Keith Olbermann, and others have taken turns trying to analyze the man and/or the deal to consume Dow Jones and it’s pearl, the Wall Street Journal.

Time’s piece covers a lot of the same territory as the others, but delivers some choice quotations from the dark horse’s mouth:

“Why would I spend $5 billion for something in order to wreck it?”
Gee, I don’t know. Why did you do it to the New York Post and your London papers?

“When you’re a catalyst for change, you make enemies – and I’m proud of the ones I’ve got.”
Like the employees of Dow Jones who staged a “sick out” to protest your attempt to buy the company? Being proud of your enemies is not exactly a display of journalistic neutrality.

“…if you look at our general news, do we put on things which favor the right rather than the left? I don’t know. We don’t think we do. We’ve always insisted we don’t. I don’t think we do. Aw, it’s subjective. Neither side admits it.”
That’s some pretty fancy footwork. Plus, it sounds like you’re admitting what you say neither side admits.

“My worry about the New York Times is that it’s got the only position as a national elitist general-interest paper. So the network news picks up its cues from the Times. And local papers do too. It has a huge influence. And we’d love to challenge it.”
Asserting that you want to challenge the influence of the “national elitist” New York Times is further proof that you intend to shape the content of the Journal despite your denials.

It couldn’t be more clear, to anyone with a discernible pulse, that Murdoch is determined to burn his brand onto the Dow Jones properties regardless of what promises he mumbles to seal the deal. If the Bancrofts consent to Murdoch’s overtures they cannot later claim that they had no idea what damage he would do. They cannot pretend that they thought the paper’s integrity had been protected. They will be forever culpable for their naivete and their greed. No excuses – just a legacy of shame.