Clashing cultures in Murdoch and WSJ

Roger Lowenstein writes in the New Republic that the issue with News Corp. CEO Rupert Murdoch acquiring Dow Jones & Co., the owners of The Wall Street Journal, is the culture clash between old money and new money.

Lowenstein wrote, “Though Murdoch, like the Journal‘s editorial page, is famously right-wing, News Corp and Dow Jones have vastly different cultures. (Full disclosure: I reported for the Journal for 17 years, and I still write for SmartMoney, a sister Dow Jones publication, as well as for The New York Times Magazine.) Murdoch relishes involving himself in editorial matters, even in the news pages; the Bancrofts are invisible, and neither they nor their proxies in management meddle with the news. Perhaps more importantly, while Murdoch has not been shy about sensationalizing his journalism, Dow Jones is an almost quaint paragon of traditional values. Judging from its scolding editorials, the Journal‘s editors have yet to get over the sexual revolution of the 1960s. The Bancrofts’ rejection thus has echoes of Edith Wharton: a five-generation-old dynasty, its best days (in a financial sense) behind it, snubbing the tasteless and arriviste Murdoch–who happens to be the most successful media titan of the last 50 years.

“No doubt, Murdoch would bring change. But, thanks to the mass exodus of advertisers and readers to the Web, change, most often in the form of cost-cutting, has already hit the industry like a sledgehammer–including at Dow Jones, which recently shrank the Journal‘s physical size. And it is extremely doubtful that, after spending $5 billion to acquire Dow Jones, Murdoch would take action to weaken the Journal‘s value, which derives from its position as the respected authority on U.S. business.

“In any case, what the Bancrofts want and what the employees want leaves out a critical voice–that of the other owners. And they have fared miserably. Previous to Murdoch’s bid, Dow Jones was trading at $36.33, a level unchanged from 1983. That’s an incredible dry spell considering the bountiful fortunes reaped in the stock market over the past quarter-century.

“And blaming the stock’s poor showing on the industry’s woes will not quite fly. The Post‘s stock rose nine times over that span; the Times‘ quadrupled. Dow Jones–which, from 1991 through last year, was run by a former prize-winning journalist, Peter Kann–badly mismanaged the transition to electronic news dissemination, allowing Bloomberg (another dastardly newcomer) to steal its thunder. And, despite an early start, it failed to leverage its brand overseas and establish anything like the preeminence it has at home.”

Read more here.