News Corp splits in two, and Rupert pours champagne

News Corp. announced details of its split in two on Monday. Here’s the Wall Street Journal’s take on its own fate:

News Corp on Monday fleshed out management details for when the media conglomerate splits in two, and disclosed that the News Corp. name will stay with the publishing assets.

After the split, the entertainment assets will take the name Fox Group.

Also on Monday, the media company disclosed that it will cease publication of the Daily, its iPad-only publication, in mid-December, ending a money-losing experiment in digital publishing.

Heading the publishing company post-spinoff will be Robert Thomson, 51 years old, who is currently Wall Street Journal managing editor and editor in chief of Dow Jones. News Corp. said he will assume the new role on Jan. 1, though the split isn’t expected to be completed until midyear.

Gerard Baker, 50, currently Mr. Thomson’s deputy at the Journal, will succeed him, the company confirmed. In the Journal’s newsroom on Monday afternoon, with the staff gathered, News Corp. Chairman and CEO Rupert Murdoch jokingly poured Champagne on Mr. Baker’s head after a round of speeches.

Here’s the New York Times take on it:

A phone hacking scandal and restless shareholders may have forced Rupert Murdoch to split News Corporation into two companies, but on Monday he celebrated the decision by pouring Veuve Clicquot Champagne over the head of his newest editor.

Standing in The Wall Street Journal’s newsroom on the sixth floor of News Corporation’s New York headquarters, Mr. Murdoch, chairman and chief executive, toasted Gerard Baker. Mr. Baker will take over as managing editor of The Wall Street Journal and editor in chief of Dow Jones & Company, positions held by Robert Thomson, who was named chief executive of the separate publishing company.

The publishing company will retain the name News Corporation and will consist of newspapers, including The Journal and The New York Post, and HarperCollins. Mr. Murdoch will serve as chairman.

The bigger company will be called Fox Group and will include Fox Broadcasting, 20th Century Fox and cable channels like Fox News and FX. Chase Carey, News Corporation’s president and chief operating officer, will maintain that title at Fox Group. Mr. Murdoch will serve as chief executive and chairman and his youngest son, James R. Murdoch, who left his post in Britain in the midst of the phone hacking scandal, will serve as Fox Group’s deputy chief operating officer.

But Reuters makes an interesting point about the moves:

News Corp did not disclose any financial details related to the spin off, such as how much cash and debt will be ascribed to the new publishing company, or appoint a board of directors.

Also absent from Monday’s announcement was any mention of Lachlan Murdoch, Rupert’s eldest son, who News Corp watchers and industry experts thought might be recruited back into the family business, given his previous success as publisher of the New York Post.

His ascension comes at a difficult time for print media. Newspapers face tough challenges as advertisers look elsewhere and people increasingly prefer smartphones and tablets to ink and paper.

While Thomson, a native Australian, is a long time newspaper executive, including U.S. editor of the Financial Times and editor of the Times of London, his experience has been mostly in the newsroom.

Now, however, he will have to decide what to do with the financially struggling New York Post, whether to seek a merger partner for Harper Collins and if the new company will acquire U.S. newspapers that could come onto the market, such as the Los Angeles Times and the Chicago Tribune.

This last paragraph of decisions is a lot to navigate. The media industry is still struggling to find a financial model that works and history has shown that getting bigger isn’t necessarily the way to make it work.

But analysts are looking to see what the company will do next, whether it’s paying a dividend, shedding assets, or acquiring another property. Either way, my bet is that Rupert Murdoch will emerge the winner — with or without the champagne to pour around the newsroom.