Rupert Murdoch is poised to land one of the biggest catches of his empire-building career.
But now that the question of whether he can acquire Dow Jones is near resolution, the next issue becomes pressing: What will he do with it?
The strategic reasons behind News Corp.’s acquisition are, depending on who you ask, either subtly brilliant or simply invisible.
With Dow Jones landing squarely outside the News Corp.’s U.S. entertainment business, the acquisition certainly goes against the prevailing logic of many congloms.
Forget the bleak prospects for the news biz; other congloms have been exiting any businesses that don’t fit well with their largest revenue-generators, no matter the category.
But a sale of its minority stake in DirecTV notwithstanding, News Corp. has spent several billion dollars on non-content properties like Web tools and platforms.
Now it looks to spend even more on a financial-news site — one that trails leaders like Bloomberg in market penetration. In a career marked by iconoclasm, Murdoch is again cutting against the grain.
Deal watchers have focused on how he may use Dow Jones and the Wall Street Journal to boost the Fox Business Channel, slated for an October launch. (Dow Jones has a deal with CNBC through 2012; though the net expects it to be honored, the agreement could be bought out.)
While Murdoch certainly would be helped by a financial-news source, how much he will accomplish with an acquisition that he couldn’t have achieved with a licensing deal remains unclear. On a panel earlier this month, media consultant Norman Pearlstine memorably noted that “just because you want a drink doesn’t mean you have to buy the bar.”
Murdoch is thought to be considering ways to move the chess pieces so that Dow fits with News Corp.’s other assets.