Rupert Murdoch is stepping down as chairman from both Fox Corp. (FOX, FOXA) and News Corp. (NWS, NWSA), effective in November. He will become chairman emeritus at both companies. Murdoch's son Lachlan will become the sole chair of both boards. Vanity Fair special correspondent Brian Stelter, who is working on a book about Fox, the Murdochs, and former President Trump, says the move confirms "the succession plan that had appeared to be in the works for many years."
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Video Transcript
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- We're tracking Fox shares today after Rupert Murdoch has announced that they will-- Rupert will be stepping down as chairman from Fox and News Corp this morning. That announcement was made in a memo, and his son Lachlan Murdoch will become chairman of both companies. Joining us now, we've got Vanity Fair Correspondent and Hoax Author Brian Stelter.
Brian, good to have you here with us on this. I just want to get your reaction to this finally, some semblance of a succession plan that's come forward, perhaps. But now, we're continuing to watch shares here in reaction to exactly what this means for News Corp and Fox.
BRIAN STELTER: Right. Rupert Murdoch always famously said that he would never retire. In fact, his son Lachlan Murdoch said the same thing almost a decade ago. He said, my dad is never retiring.
But today, is the closest thing we will ever see to Rupert Murdoch retiring. He is handing over all the power for the first time, and the only time in his career. And this does confirm the succession plan that had appeared to be in the works for many years. Lachlan Murdoch had clearly been the favored son, the chosen son.
Ever since 2015, 2016, 2017, son James Murdoch has completely left the companies. He hates what Fox News has become. So, now, Lachlan Murdoch will be the sole chair of both-- Fox and news corporation.
And, of course, we should face the facts, this is happening as both companies are in a shrinking period. They are in a shrinking phase. They are trying to grow, but like many other media companies, they are facing headwinds involving streaming, evolving digital subscriptions, evolving the death of newspapers.
So I supposed to be frank, these jobs are not as fun as they were when Rupert Murdoch was the swashbuckling media mogul of decades past. The job has shrunk in some ways for his son Lachlan, and now, Lachlan moves forward on own.
- Brian, what do you think this is going to have or if any, impact on the strategy at Fox and News Corp, the direction of those two companies? How do you see that changing if at all with this?
BRIAN STELTER: I think the number one question will be about editorial vision. And I think Lachlan and Rupert are very much in alignment on that. Lachlan Murdoch is as conservative, or in some cases, more conservative than his father. So I would not expect dramatic changes editorially.
On the business strategy, we have seen Lachlan Murdoch trying to expand in streaming with Tubi, for example, at Fox Corporation. And with News Corp, pressuring Facebook and Google to pay up for digital content. I would expect those moves to continue.
I think the longer term question is, what happens to these companies in the event that Rupert actually passes away and is no longer in charge of the Murdoch trust. Even though he is stepping aside today, he still has four votes out of eight in the Murdoch trust. That ultimately controls both companies.
In the event of his death, each of the four adult children have one vote each. Lachlan would only have one vote. As far as we know, unless something's changed today, and we have no reason to believe that it has on that front. So I would expect potential reorgs, reshuffling, changing of assets, only in the event Rupert passes away, not at this moment in time.
- Would this re initiate any talks around the merger between Fox and News Corp?
BRIAN STELTER: Yeah, I was I've been wondering that in the past few minutes, as well. And I haven't heard clear guidance from sources on that yet. My initial reaction is that shareholders were-- large shareholders were significantly opposed to the re-merger of News Corp and Fox earlier this year, late last year, earlier this year.
T Rowe Price, for example, large shareholder in News Corp, said this is a bad idea. James Murdoch also weighed in and said this is a bad idea. So Rupert uncharacteristically backtracked, walked away, gave up on the proposal. There are certainly going to be conversation about whether that's going to be rekindled. I don't-- I wouldn't see it happening imminently, though.
- Brian, when you take into account the fact that he does have this Emeritus status, I mean, from your time, from your colleagues, who you've spoken with in the past, how involved do you think he's still going to be in some of these decisions?
BRIAN STELTER: Yeah, it's a complex picture that we saw through the Dominion v Fox lawsuit. Because through that lawsuit, we received-- we were all able to see thousands of pages of emails and text messages, including from Rupert Murdoch. And there are some times when he seems like an active involved owner, someone who's really interested in the content, reading all of his newspapers, or watching Fox, there are other times in those emails where he seemed incredibly passive, where he was not all that engaged, where he was not steering the ship. It was more like he was just in the back of the ship taking in the view, enjoying the view.
I would say that is a 92, that is the Rupert Murdoch that comes through most days now. Someone who is not in the front, not the captain of the ship anymore. And perhaps, this announcement this morning just confirms what has been true for a little while, that he is no longer the man who put fear into the hearts of so many executives for decades.
I'm working on a book called "Network of Lies" about Fox and Murdoch and Trump. And one of my sources for the book said to me, there was a time decades ago, there was a time when Rupert would say jump, and all over everybody around him would say, how high, right? We know all-- we know that expression.
The boss says to do something, people will do it no matter what. But the point my source was making was that time has come and gone. That time has passed. He no longer commands that power.
And now, whether his son Lachlan can command that power, whether his son Lachlan will be feared and revered and reviled in the same way, I suppose that's the start of the chapter we're talking about today.
- Certainly, a new chapter there for News Corp and for Fox. Brian Stelter, always great to get your perspective on this Vanity Fair correspondent and author of hoax. Thanks, Brian.
