Robert Busch Research Paper
Profile of Rupert Murdoch
Rupert Murdoch is by any description one of the world’s most prominent business giants of the modern commercial world. As head of News Corporation he can be rightly classified as a true entrepreneur but some commentators of gone further from such ‘pleasantries’ and referred to him as a corporate tyrant. It is important to understand what he has achieved and how he has developed his media empire.
The 20th century saw many ‘media moguls’ and Murdoch with a personal fortune in excess of £5 billion, is up their with the rest. They have been elevated to pinnacles of power and celebrity.
The News Corporation is divided into five key operating divisions; Filmed Entertainment, Television, Magazines and Inserts, Newspapers and Book Publishing and includes many well-known corporate such as ABC Television, Asian-based Star …show more content…
Television, 20th Century Fox, The Times in London and New York Post. The combined group reported sales revenues in excess of $21 billion during 1999.
From his early days at Oxford University back in the 1950’s Murdoch’s character is one that has opted for a role of dominance in his chosen commercial field of media and broadcasting. In terms of his influence, it is all encompassing and transcends from both a high level strategic overview to a flag-waving public face of his New Corporation empire. Murdoch takes the role of Chairman and Chief Executive, backed Peter Chernin as President and Chief Operating Officer; one must question the distinct difference in these roles from a corporate governance situation.
Murdoch lives and breathes for the success of the organisation. He once commented, “for better or for worse, our company is a reflection of my thinking, my character, my values.”(FT, 2000). They describe themselves in the Annual Report as “the only vertically integrated Media Company on a global scale” and as they now reach 2/3rds of the World’s population through all mediums this is not a corporate oversell. The first illustration of his entrepreneurial spirit is in the structure and ownership of the News Corporation organisation. The company is managed by a 21-strong Executive Committee, which includes his two sons, James and Lachlan and his Daughter, Elisabeth. The Executive Committee lists strategic direction as one of its primary focuses. The Executive Committee …"reviews and sets the strategic focus and direction of all major businesses of the company" (News Corporation, 1999). The Murdoch family directly controls some 30% of the company’s stocks.
Does he interfere?
Andrew Neil, former editor of The Sunday Times, is well known for commenting that Murdoch had a seemingly unhealthy influence on the direction and editorial content of his newspapers. Murdoch himself says “I try to keep in touch with the details…I look at the product daily. That doesn’t mean you interfere, but it’s important occasionally to show the ability to be involved. It shows you understand what’s happening”.
Image
In the main foyer of New’s offices in London there is a 20ft high painting of Murdoch, towering over the entranceway. His office within the Daily Mirror is reported to be “very large and timber lined” by Keith Bashford, former New International journalist. Bashford had ‘crossed’ Murdoch over an editorial piece to which Murdoch responded to with a “hurricane that filled my ears and my brain. His attack had an operatic quality that I almost admired. Perhaps most bizarrely as I withstood this violent assault, I also detected a note of impartiality in his voice.” Michael Leapman entitled his 1984 biography of Murdoch the “Arrogant Aussie” and this style appears as a theme throughout his approach to life and commercialism.
This ‘larger than life’ personality is prominent in many ways, although it is acknowledged that he is actually a fairly introverted character on the public stage and doesn’t like celebrity for celebrity’s sake. His focus in on development of his business interests rather than personal kudos and the report by Bashford goes someway to illustrate that he will do almost anything to further his business, but it’s ‘not personal’ to those that he confronts along the way. This perhaps goes someway to highlight why Murdoch was attracted to the media world in the first place. He can express his thoughts and feelings without them being directly attributed to him, a type of back seat dominance of the arena but with everyone knowing who he is.
There is no love lost between the top industry moguls. There is a well-documented verbal, as well as commercial battle between Murdoch as Ted Turner, founder of CNN. Turner recently referred to Murdoch’s latest wife, Wendy Deng as being “young enough to be his granddaughter”. Wired.com, the on-line news service described Murdoch as “the Darth Vader of modern media, a brilliant and idiosyncratic loner and pirate who operates outside the glamorous mogul circuit. He has figured out were modern media is really going….he is betting on all [media] of them.” Ted Turner likened Murdoch to Hitler in a public statement and Murdoch, on his part, has often used his publications as a perceived ‘voice’ for his own feelings especially when his New York Post referred to Turner as “veering dangerously towards insanity or are his comments…evidence that he has come off the medication that he takes to fight his manic depression?”
Murdoch could be viewed a having a philanthropic nature. In addition to various charitable commitments, this was demonstrated by his recent donation of $10 for a new catholic cathedral in Los Angeles. He was subsequently, and some say, conveniently, then appointed as a member of the “Pontifical Order of St Gregory the great”, which is essentially a papal knighthood. This in an environment where the church has viewed some of his TV and Satellite stations as being ‘sleazy’. At the ceremony for his ‘knighthood’ it was stated that he had an ‘unblemished character’. He divorced his wife of 31 years in during the same year.
Murdoch is a director of tobacco giant, Philip Morris, and also a director of CATO, the US rightwing think tank that portrays itself as a humanitarian organization. CATO is a body referred to by authors Stefanic and Delgado as “playing a key role in forming the ideas and policies of the new Republican majority in Congress”. In an internal Philip Morris document they refer to Murdoch as being “sympathetic to our position” and comments that “Murdoch’s papers rarely publish anti-smoking articles these days”. He was made a director of PM in 1989. Former director of PM, Geoffrey Bible was voted onto the board of Murdoch’s News Corporation in June 1998. This interaction with semi-political issues is common in the Murdoch rise not least through favorable US taxation rulings. A 1997 New York Times article noted of his Fox TV network “could never have succeeded if it had not received generous treatment at the Federal Communication Commission.” In 1996 Murdoch personally donated $1 million to US Republican electioneers.
Murdoch, originally an Australian citizen, became British and then an American citizen in order to ensure business interests were controlled and this theme of complete ‘commitment’ to his business direction is prominent throughout his growth and development of the News Corporation. Andrew Neil notes that Murdoch “will curb his ideology for commercial reasons” realizing that “a Sunday Times which entirely reflected his far-right politics, especially on social issues, would lose readers.” Taking Neil’s assessment one-step further this right-wing approach is often favored by corporate advertisers, News Corporations bread and butter. Fellow Cato contributors 8 include; American Express, Salomon Brothers, Shell Oil, Chevron, Pfizer and Citicorp most of which are large corporate advertisers in Murdoch’s print and TV media.
News, as it is often referred to, alongside Bertelsmann remains in the Top 3 of global media companies behind Time Warner and Disney a situation that Murdoch is acknowledged to despise. His organisation experienced growth in excess of 10% during 1999 and is actively investing in new media opportunities left right and centre. Despite now being over 70, his active involvement is expected to continue until News Corporation is in the Number One position globally and his position of media’s king established in history
Is there something about the media business that makes it particularly attractive to entrepreneurs?
The past 15 years or so have been one of the few times when owning media businesses has seemed glamorous. There have always been rich, sometimes arrogant and greedy people involved in the press, but they were hardly chic. William Randolph Hearst, for example, horrified his friends when he descended into the gutter of newspaper publishing. Recently however, we have witnessed the age of the media mogul or entrepreneur. A handful of rich males - Barry Diller, Rupert Murdoch, the late Steve Ross, Ted Turner, Mort Zuckerman, John C Malone, Laurence Tisch, Robert Wright, Gerald M. Levin and most recently Bill Gates have been elevated to what journalism considers pinnacles of power and celebrity. Sometimes they have even been described as visionaries.
Why are many of these entrepreneurs drawn to the high-risk media game? They could make much more money elsewhere, but the glamour possibilities in other industries are fewer – nobody would know who they were?
The greedy and ill-tempered insurance tycoon Laurence Tisch was hardly a household name until he bought CBS in the late 1980’s. As a media mogul, he went to the hottest parties. But after he sold CBS (though he is still one of America’s wealthiest men), he vanished into obscurity.
A ‘media mogul’ can be defined as a person who owns and operates major media companies, who takes entrepreneurial risks, and who conducts these media businesses in a personal or eccentric style. Given this last characteristic – personal or eccentric style – any two media moguls differ from each other. Think of such people as Murdoch, Hearst and Burlesconi; even these individuals do not possess all the media moguls’ characteristics in full.
The pure or classic example of the media mogul confines his business activities largely to the media. Most media moguls however own some non-media businesses. There are also some examples of entrepreneurs who are primarily captains in some other industrial field, but in addition own and operate major media interests. The captain of industry who also had major media interests became a common pattern in 1980s Italy.
As the owner and operator of media enterprises, the media entrepreneur can command personal publicity on a massive scale; he is also of special interest to his fellow and rival media entrepreneurs and managers. The entrepreneur exercises a special fascination for all journalists and publicists – for who he may be a past, or potentially future, employer. Moreover the mogul’s distinctive personal style often involves a highly distinctive personal publicity stance.
Some media moguls are self-publicists on a grand scale, but others seek to minimize publicity, seldom give interviews and avoid photographers. Most pursue some combination of high and low publicity profile – for example carefully limiting their public appearances while talking profusely and ‘not for attribution’ to selected journalists.
Great public concern and major controversy focus on media moguls in general and in certain individuals in particular. Relatively few people both read and understand the media mogul’s annual report – indeed some moguls operate private companies or control public companies. through private trusts. Few people attempt to inspect and assess the full range of media output from a single entrepreneur’s media enterprises. Public debate and controversy inevitably relies quite heavily on the media coverage of relevant moguls. Thus the entrepreneur’s media image – contrived both by himself and his employees as well as by rival moguls and their employees is a formidable barrier to objective understanding.
But it is the media entrepreneur’s political connections and electoral support, which lead to the greatest public controversy. In addition to delivering partisan support, at national elections media entrepreneurs may actively influence the evolving national political agenda through their ownership of prestige newspapers. Axel Springer (Die Welt), Robert Hersant (Le Figaro) and Rupert Murdoch (The Times – London)) all controlled prestige dailies by the 1980s; and all of the leading Italian dailies came to be controlled either by industrialist media moguls or by Burlesconi. The same patterns are now emerging in relation to the new media technologies.
Media entrepreneurs also tend to be politically involved in yet another way. The entrepreneurs seek favours from their political friends – in return for electoral and agenda setting support. There is also the implied threat that if a business favor is not granted, and then a less friendly editorial stance could result. In their business activities, and especially in their attempts to buy new properties and to enter new media fields, media entrepreneurs come into political conflict with media law and regulation on several fronts. Most obviously in entering new fields, media entrepreneurs tread on uncertain legal ground. Entrepreneurs come into conflict with independent or quasi-autonomous, regulatory agencies; but sometimes they may also face regulatory decisions, which lie within the direct power of politicians in office. Media entrepreneurs may face the threat or promise of friendly or damaging new legislation. Murdoch’s purchase of the Times, The Sunday Times and Today in Britain all depended on favorable Thatcher interpretations of ambiguously worded monopoly law. Successive Australian Governments were even more indulgent of him in a series of decisions, which ultimately allowed him; despite acquiring US citizenship; to control some two thirds of all Australian daily newspaper circulation.
If we ask ourselves are media entrepreneurs party political loyalists, the answer seems to be no. Any political allegiances tend to be opportunistic. Evidence shows that these media moguls are not always loyal and certainly not to a party. Political allegiances tend to be with individual leading politicians and not with parties. This personal approach to politics is in line with their highly personal style, typical within entrepreneurs. As an own-and-operate entrepreneur they are risk takers who, to a greater or lesser extent, follow their personal inclinations. If you look at successful media entrepreneurs we are dealing with people who have not only indulged their own personal hunches and played to their individual strengths, but have done so with commercial success. Their working lives tend to spill into their private lives and vice versa. Business strategy and personal characteristics tend to merge into a single business-personal image. This merging seems to appeal to both show business and financial journalists. It makes for volatility, not least in terms of image and reputation, but also in terms of business reality and financial performance.
The media entrepreneur, keenly aware of his larger than life image and his previous record of successful risk taking, may be inclined to plunge into larger risks; business associates and bankers also dazzled by image and track record; may encourage yet further leaps into the financial unknown.
Media moguls with track records of successful profit making are of considerable interest to the financial services and banking industry. The New York and London stock markets each have a lengthy list of media companies. In the past this has led not only to an active market in media company shares but also to an active market making loans to media companies. Media moguls such as Murdoch, moreover, had a strong interest in bank borrowing, which enabled them to avoid issuing new shares and thus reducing their own control. Hence media entrepreneurs became significant figures also in the financial world, beyond the scale warranted by the size and strength of their companies. The large bank loans fuelled additional celebrity and notoriety. Under radically changed financial conditions in 1989 – 91, heavy bank debt found Rupert Murdoch and several other media entrepreneurs in severe business difficulty.
Jon Kayz, writing for Wired News in 1999 proposed that in our time the media mogul would fade into obscurity. He states that ‘these men may remain glamorous for a while, but that only tends to obscure the reality that that the new media mitigate against barons who control information. Compared with their predecessors such as Henry Luce and Bill Paley, your modern media mogul controls relatively small chunks of media in its various forms. Today’s media is so vast and varied, even the richest media moguls can’t buy all of it. No one or two can break through to earn the kind of money and gain the kind of power that might justify the degree to which they are beautified by modern journalism..... For all the hype surrounding the digital culture, and for all its own arrogance and chaos, one of the enduring legacies of the Internet may well be that it has returned the individual the center of media. With the sale of each modem, it is less likely that a tiny handful of people will ever again control most of the media............... Only Rupert Murdoch, the Darth Vader of modern media, a brilliant and idiosyncratic loner and pirate who operates largely outside the glamorous media mogul circuit, has figured out where modern media is going. Instead of betting on one medium – cable, the Net, a broadcast network – he is betting on all of them, assembling a staggering network of newspapers, TV networks, cable channels and satellite TV services that now bring popular culture too much of the world. However the news consumer of the future is shaping up as a sophisticated, restless independent-minded and interactive information gatherer. He’ll pick and choose what he needs and wants: a web site here, a cable program there, videos for this purpose, radio for that, email and network television when it fits his needs. She will read books, buy magazines, shop on the web, trawl through Amazon.com and L L Bean online and download movies. She’ll follow and discuss news and information through an individualized, constantly changing, techno-centered mix of media............ media is too big, diverse and fluid for any handful of people to dominate for long’ or does Rupert Murdoch negate this argument?
Will the opposite become true as portrayed in FUTURECAST – The King of Chaos (Sunday 23/4/00 Channel 4)? Will we in fact see one or two people controlling the convergence of all media so that all TV is available over the Internet for free? The programme featured video-on-demand over the Net, the introduction of sophisticated ‘systems agents, to help you find what you want amid the morass of unwanted material, and the introduction of brand-led broadcasting. The reality is that all three will soon be with us. The most controversial is likely to be the gradual loss of popular programmes by the broadcasters to webchannels owned and financed by the large brand names like Virgin, Nike and Sony.
The programme was based on extensive research and features interviews with leading futurologists including BT’s Director of Research PETER COCHRANE.
Future entrepreneurs and the new media
As the century winds down and the media business thrives through unprecedented revolution, a clutch of high profile entrepreneurs has seized centre stage. New communication technologies are redrawing the very boundaries of organisations.
Ericksen (1999) argues that the 21st Century may very well be remembered as the “Entrepreneurial Age”, in the same way that the Industrial Age is associated with the 19th Century and the Corporate Age with the 20th Century.
Useem (1999) argues that what both eras have in common is the kind of people who shaped them. The entrepreneurs of today may be building something very different from what was left to them by the last century’s lords of creation, but their underlying genius is the same. That underlines the understanding of what great entrepreneurship really is:
An ability to recognize fundamental changes in the world that present new opportunities
To form business strategies that take advantages of those changes
To devise the new kinds of organizations needed to execute those strategies
Richman (1997) stereotypically describes traditional entrepreneur as a male, usually lacking significant educational credentials, who operate from the gut.
He followed no plan and did things his way. He took risk and what he built, he owned. In his company, he made the rules. Employees could choose: they could do what the boss said, or they could leave. The entrepreneur didn’t expect bankers to understand what he did because entrepreneurs were, after all, born, not made. Entrepreneurship was an art, and entrepreneurs were artists.
Richman (1997) hypothesizes that what was really occurred is that entrepreneurism has changed dramatically from amateurism to what he terms the professional entrepreneur. He distinguishes the following differences between the two: Self-reliant | Inquisitive | Pro-phobe (dislikes professionals) | Pro-phile | Start-up | Start-up or Whatever
| Organizationally Orthodox | Organizationally Innovative | Trade Association Member | Web Surfer | Self-sufficient | Virtual | Think Small | Think Big | Small-business Founder | Entrepreneur | Seat-of-the-pants | Business Plan | Boss | Leader | Male | Mixed | Supportive Spouse at Home | Spouse Runs Own Business | Automation | Innovation | Intuition | Education | Research Backwater | Research Mainstream | Price Takers | Value Makers | Personal Financial Plan is the Business | Business is Part of Personal Finance Plan | Art | Science | Equity= Control | Performance=Control | Company | Career |
Professional entrepreneurs today don’t just have great ideas; they have great ideas and know how to plan their execution and know which capital sources to approach. The Economist (1997) states that the firms are surviving because entrepreneurs with sound ideas and limitless energy run them. But they are thriving growing at incredible rates more – in-part because they were financed and helped along by venture capitalists, who took a chance on their potential long before any financial market or bank would touch them.
The media business itself has been moving from broadcasting to narrow casting. All media companies used to produce one identical product – a film, a newspaper or a broadcast television network –, which they offer out to as many consumers as they could. Cable television changed that by starting to fragment the audience. Cable networks had to approach their audiences in a different way to the broadcasters: they had to develop niche programming, which meant thinking about what make people different, not what they had in common.
In future, new media companies will be seen as the prehistoric ancestors of fully evolved narrow casters. For they began a process that the Internet takes much further: bringing company and customer closer together. Consumers can answer back, and so they tell companies what they want. Companies can find out far more about their customers: where they live, where they shop, what music they like, what books they read. The individual relationship between producer and customers is in its infancy; but already, all sort of companies are beginning to sell things differently on the Internet. AOL Time Warner plans to make early use of these possibilities. AOL will, for instance, offer its subscribers free clips from Warner Music: because AOL knows its subscribers, they will be clips of the kind of music those individuals might want to listen to.
Rupert Murdoch is by any description one of the world’s most prominent business giants of the modern commercial world. As head of News Corporation he can be rightly classified as a true entrepreneur but some commentators of gone further from such ‘pleasantries’ and referred to him as a corporate tyrant. It is important to understand what he has achieved and how he has developed his media empire.
The 20th century saw many ‘media moguls’ and Murdoch with a personal fortune in excess of £5 billion, is up their with the rest. They have been elevated to pinnacles of power and celebrity.
The News Corporation is divided into five key operating divisions; Filmed Entertainment, Television, Magazines and Inserts, Newspapers and Book Publishing and includes many well-known corporate such as ABC Television, Asian-based Star …show more content…
Television, 20th Century Fox, The Times in London and New York Post. The combined group reported sales revenues in excess of $21 billion during 1999.
From his early days at Oxford University back in the 1950’s Murdoch’s character is one that has opted for a role of dominance in his chosen commercial field of media and broadcasting. In terms of his influence, it is all encompassing and transcends from both a high level strategic overview to a flag-waving public face of his New Corporation empire. Murdoch takes the role of Chairman and Chief Executive, backed Peter Chernin as President and Chief Operating Officer; one must question the distinct difference in these roles from a corporate governance situation.
Murdoch lives and breathes for the success of the organisation. He once commented, “for better or for worse, our company is a reflection of my thinking, my character, my values.”(FT, 2000). They describe themselves in the Annual Report as “the only vertically integrated Media Company on a global scale” and as they now reach 2/3rds of the World’s population through all mediums this is not a corporate oversell. The first illustration of his entrepreneurial spirit is in the structure and ownership of the News Corporation organisation. The company is managed by a 21-strong Executive Committee, which includes his two sons, James and Lachlan and his Daughter, Elisabeth. The Executive Committee lists strategic direction as one of its primary focuses. The Executive Committee …"reviews and sets the strategic focus and direction of all major businesses of the company" (News Corporation, 1999). The Murdoch family directly controls some 30% of the company’s stocks.
Does he interfere?
Andrew Neil, former editor of The Sunday Times, is well known for commenting that Murdoch had a seemingly unhealthy influence on the direction and editorial content of his newspapers. Murdoch himself says “I try to keep in touch with the details…I look at the product daily. That doesn’t mean you interfere, but it’s important occasionally to show the ability to be involved. It shows you understand what’s happening”.
Image
In the main foyer of New’s offices in London there is a 20ft high painting of Murdoch, towering over the entranceway. His office within the Daily Mirror is reported to be “very large and timber lined” by Keith Bashford, former New International journalist. Bashford had ‘crossed’ Murdoch over an editorial piece to which Murdoch responded to with a “hurricane that filled my ears and my brain. His attack had an operatic quality that I almost admired. Perhaps most bizarrely as I withstood this violent assault, I also detected a note of impartiality in his voice.” Michael Leapman entitled his 1984 biography of Murdoch the “Arrogant Aussie” and this style appears as a theme throughout his approach to life and commercialism.
This ‘larger than life’ personality is prominent in many ways, although it is acknowledged that he is actually a fairly introverted character on the public stage and doesn’t like celebrity for celebrity’s sake. His focus in on development of his business interests rather than personal kudos and the report by Bashford goes someway to illustrate that he will do almost anything to further his business, but it’s ‘not personal’ to those that he confronts along the way. This perhaps goes someway to highlight why Murdoch was attracted to the media world in the first place. He can express his thoughts and feelings without them being directly attributed to him, a type of back seat dominance of the arena but with everyone knowing who he is.
There is no love lost between the top industry moguls. There is a well-documented verbal, as well as commercial battle between Murdoch as Ted Turner, founder of CNN. Turner recently referred to Murdoch’s latest wife, Wendy Deng as being “young enough to be his granddaughter”. Wired.com, the on-line news service described Murdoch as “the Darth Vader of modern media, a brilliant and idiosyncratic loner and pirate who operates outside the glamorous mogul circuit. He has figured out were modern media is really going….he is betting on all [media] of them.” Ted Turner likened Murdoch to Hitler in a public statement and Murdoch, on his part, has often used his publications as a perceived ‘voice’ for his own feelings especially when his New York Post referred to Turner as “veering dangerously towards insanity or are his comments…evidence that he has come off the medication that he takes to fight his manic depression?”
Murdoch could be viewed a having a philanthropic nature. In addition to various charitable commitments, this was demonstrated by his recent donation of $10 for a new catholic cathedral in Los Angeles. He was subsequently, and some say, conveniently, then appointed as a member of the “Pontifical Order of St Gregory the great”, which is essentially a papal knighthood. This in an environment where the church has viewed some of his TV and Satellite stations as being ‘sleazy’. At the ceremony for his ‘knighthood’ it was stated that he had an ‘unblemished character’. He divorced his wife of 31 years in during the same year.
Murdoch is a director of tobacco giant, Philip Morris, and also a director of CATO, the US rightwing think tank that portrays itself as a humanitarian organization. CATO is a body referred to by authors Stefanic and Delgado as “playing a key role in forming the ideas and policies of the new Republican majority in Congress”. In an internal Philip Morris document they refer to Murdoch as being “sympathetic to our position” and comments that “Murdoch’s papers rarely publish anti-smoking articles these days”. He was made a director of PM in 1989. Former director of PM, Geoffrey Bible was voted onto the board of Murdoch’s News Corporation in June 1998. This interaction with semi-political issues is common in the Murdoch rise not least through favorable US taxation rulings. A 1997 New York Times article noted of his Fox TV network “could never have succeeded if it had not received generous treatment at the Federal Communication Commission.” In 1996 Murdoch personally donated $1 million to US Republican electioneers.
Murdoch, originally an Australian citizen, became British and then an American citizen in order to ensure business interests were controlled and this theme of complete ‘commitment’ to his business direction is prominent throughout his growth and development of the News Corporation. Andrew Neil notes that Murdoch “will curb his ideology for commercial reasons” realizing that “a Sunday Times which entirely reflected his far-right politics, especially on social issues, would lose readers.” Taking Neil’s assessment one-step further this right-wing approach is often favored by corporate advertisers, News Corporations bread and butter. Fellow Cato contributors 8 include; American Express, Salomon Brothers, Shell Oil, Chevron, Pfizer and Citicorp most of which are large corporate advertisers in Murdoch’s print and TV media.
News, as it is often referred to, alongside Bertelsmann remains in the Top 3 of global media companies behind Time Warner and Disney a situation that Murdoch is acknowledged to despise. His organisation experienced growth in excess of 10% during 1999 and is actively investing in new media opportunities left right and centre. Despite now being over 70, his active involvement is expected to continue until News Corporation is in the Number One position globally and his position of media’s king established in history
Is there something about the media business that makes it particularly attractive to entrepreneurs?
The past 15 years or so have been one of the few times when owning media businesses has seemed glamorous. There have always been rich, sometimes arrogant and greedy people involved in the press, but they were hardly chic. William Randolph Hearst, for example, horrified his friends when he descended into the gutter of newspaper publishing. Recently however, we have witnessed the age of the media mogul or entrepreneur. A handful of rich males - Barry Diller, Rupert Murdoch, the late Steve Ross, Ted Turner, Mort Zuckerman, John C Malone, Laurence Tisch, Robert Wright, Gerald M. Levin and most recently Bill Gates have been elevated to what journalism considers pinnacles of power and celebrity. Sometimes they have even been described as visionaries.
Why are many of these entrepreneurs drawn to the high-risk media game? They could make much more money elsewhere, but the glamour possibilities in other industries are fewer – nobody would know who they were?
The greedy and ill-tempered insurance tycoon Laurence Tisch was hardly a household name until he bought CBS in the late 1980’s. As a media mogul, he went to the hottest parties. But after he sold CBS (though he is still one of America’s wealthiest men), he vanished into obscurity.
A ‘media mogul’ can be defined as a person who owns and operates major media companies, who takes entrepreneurial risks, and who conducts these media businesses in a personal or eccentric style. Given this last characteristic – personal or eccentric style – any two media moguls differ from each other. Think of such people as Murdoch, Hearst and Burlesconi; even these individuals do not possess all the media moguls’ characteristics in full.
The pure or classic example of the media mogul confines his business activities largely to the media. Most media moguls however own some non-media businesses. There are also some examples of entrepreneurs who are primarily captains in some other industrial field, but in addition own and operate major media interests. The captain of industry who also had major media interests became a common pattern in 1980s Italy.
As the owner and operator of media enterprises, the media entrepreneur can command personal publicity on a massive scale; he is also of special interest to his fellow and rival media entrepreneurs and managers. The entrepreneur exercises a special fascination for all journalists and publicists – for who he may be a past, or potentially future, employer. Moreover the mogul’s distinctive personal style often involves a highly distinctive personal publicity stance.
Some media moguls are self-publicists on a grand scale, but others seek to minimize publicity, seldom give interviews and avoid photographers. Most pursue some combination of high and low publicity profile – for example carefully limiting their public appearances while talking profusely and ‘not for attribution’ to selected journalists.
Great public concern and major controversy focus on media moguls in general and in certain individuals in particular. Relatively few people both read and understand the media mogul’s annual report – indeed some moguls operate private companies or control public companies. through private trusts. Few people attempt to inspect and assess the full range of media output from a single entrepreneur’s media enterprises. Public debate and controversy inevitably relies quite heavily on the media coverage of relevant moguls. Thus the entrepreneur’s media image – contrived both by himself and his employees as well as by rival moguls and their employees is a formidable barrier to objective understanding.
But it is the media entrepreneur’s political connections and electoral support, which lead to the greatest public controversy. In addition to delivering partisan support, at national elections media entrepreneurs may actively influence the evolving national political agenda through their ownership of prestige newspapers. Axel Springer (Die Welt), Robert Hersant (Le Figaro) and Rupert Murdoch (The Times – London)) all controlled prestige dailies by the 1980s; and all of the leading Italian dailies came to be controlled either by industrialist media moguls or by Burlesconi. The same patterns are now emerging in relation to the new media technologies.
Media entrepreneurs also tend to be politically involved in yet another way. The entrepreneurs seek favours from their political friends – in return for electoral and agenda setting support. There is also the implied threat that if a business favor is not granted, and then a less friendly editorial stance could result. In their business activities, and especially in their attempts to buy new properties and to enter new media fields, media entrepreneurs come into political conflict with media law and regulation on several fronts. Most obviously in entering new fields, media entrepreneurs tread on uncertain legal ground. Entrepreneurs come into conflict with independent or quasi-autonomous, regulatory agencies; but sometimes they may also face regulatory decisions, which lie within the direct power of politicians in office. Media entrepreneurs may face the threat or promise of friendly or damaging new legislation. Murdoch’s purchase of the Times, The Sunday Times and Today in Britain all depended on favorable Thatcher interpretations of ambiguously worded monopoly law. Successive Australian Governments were even more indulgent of him in a series of decisions, which ultimately allowed him; despite acquiring US citizenship; to control some two thirds of all Australian daily newspaper circulation.
If we ask ourselves are media entrepreneurs party political loyalists, the answer seems to be no. Any political allegiances tend to be opportunistic. Evidence shows that these media moguls are not always loyal and certainly not to a party. Political allegiances tend to be with individual leading politicians and not with parties. This personal approach to politics is in line with their highly personal style, typical within entrepreneurs. As an own-and-operate entrepreneur they are risk takers who, to a greater or lesser extent, follow their personal inclinations. If you look at successful media entrepreneurs we are dealing with people who have not only indulged their own personal hunches and played to their individual strengths, but have done so with commercial success. Their working lives tend to spill into their private lives and vice versa. Business strategy and personal characteristics tend to merge into a single business-personal image. This merging seems to appeal to both show business and financial journalists. It makes for volatility, not least in terms of image and reputation, but also in terms of business reality and financial performance.
The media entrepreneur, keenly aware of his larger than life image and his previous record of successful risk taking, may be inclined to plunge into larger risks; business associates and bankers also dazzled by image and track record; may encourage yet further leaps into the financial unknown.
Media moguls with track records of successful profit making are of considerable interest to the financial services and banking industry. The New York and London stock markets each have a lengthy list of media companies. In the past this has led not only to an active market in media company shares but also to an active market making loans to media companies. Media moguls such as Murdoch, moreover, had a strong interest in bank borrowing, which enabled them to avoid issuing new shares and thus reducing their own control. Hence media entrepreneurs became significant figures also in the financial world, beyond the scale warranted by the size and strength of their companies. The large bank loans fuelled additional celebrity and notoriety. Under radically changed financial conditions in 1989 – 91, heavy bank debt found Rupert Murdoch and several other media entrepreneurs in severe business difficulty.
Jon Kayz, writing for Wired News in 1999 proposed that in our time the media mogul would fade into obscurity. He states that ‘these men may remain glamorous for a while, but that only tends to obscure the reality that that the new media mitigate against barons who control information. Compared with their predecessors such as Henry Luce and Bill Paley, your modern media mogul controls relatively small chunks of media in its various forms. Today’s media is so vast and varied, even the richest media moguls can’t buy all of it. No one or two can break through to earn the kind of money and gain the kind of power that might justify the degree to which they are beautified by modern journalism..... For all the hype surrounding the digital culture, and for all its own arrogance and chaos, one of the enduring legacies of the Internet may well be that it has returned the individual the center of media. With the sale of each modem, it is less likely that a tiny handful of people will ever again control most of the media............... Only Rupert Murdoch, the Darth Vader of modern media, a brilliant and idiosyncratic loner and pirate who operates largely outside the glamorous media mogul circuit, has figured out where modern media is going. Instead of betting on one medium – cable, the Net, a broadcast network – he is betting on all of them, assembling a staggering network of newspapers, TV networks, cable channels and satellite TV services that now bring popular culture too much of the world. However the news consumer of the future is shaping up as a sophisticated, restless independent-minded and interactive information gatherer. He’ll pick and choose what he needs and wants: a web site here, a cable program there, videos for this purpose, radio for that, email and network television when it fits his needs. She will read books, buy magazines, shop on the web, trawl through Amazon.com and L L Bean online and download movies. She’ll follow and discuss news and information through an individualized, constantly changing, techno-centered mix of media............ media is too big, diverse and fluid for any handful of people to dominate for long’ or does Rupert Murdoch negate this argument?
Will the opposite become true as portrayed in FUTURECAST – The King of Chaos (Sunday 23/4/00 Channel 4)? Will we in fact see one or two people controlling the convergence of all media so that all TV is available over the Internet for free? The programme featured video-on-demand over the Net, the introduction of sophisticated ‘systems agents, to help you find what you want amid the morass of unwanted material, and the introduction of brand-led broadcasting. The reality is that all three will soon be with us. The most controversial is likely to be the gradual loss of popular programmes by the broadcasters to webchannels owned and financed by the large brand names like Virgin, Nike and Sony.
The programme was based on extensive research and features interviews with leading futurologists including BT’s Director of Research PETER COCHRANE.
Future entrepreneurs and the new media
As the century winds down and the media business thrives through unprecedented revolution, a clutch of high profile entrepreneurs has seized centre stage. New communication technologies are redrawing the very boundaries of organisations.
Ericksen (1999) argues that the 21st Century may very well be remembered as the “Entrepreneurial Age”, in the same way that the Industrial Age is associated with the 19th Century and the Corporate Age with the 20th Century.
Useem (1999) argues that what both eras have in common is the kind of people who shaped them. The entrepreneurs of today may be building something very different from what was left to them by the last century’s lords of creation, but their underlying genius is the same. That underlines the understanding of what great entrepreneurship really is:
An ability to recognize fundamental changes in the world that present new opportunities
To form business strategies that take advantages of those changes
To devise the new kinds of organizations needed to execute those strategies
Richman (1997) stereotypically describes traditional entrepreneur as a male, usually lacking significant educational credentials, who operate from the gut.
He followed no plan and did things his way. He took risk and what he built, he owned. In his company, he made the rules. Employees could choose: they could do what the boss said, or they could leave. The entrepreneur didn’t expect bankers to understand what he did because entrepreneurs were, after all, born, not made. Entrepreneurship was an art, and entrepreneurs were artists.
Richman (1997) hypothesizes that what was really occurred is that entrepreneurism has changed dramatically from amateurism to what he terms the professional entrepreneur. He distinguishes the following differences between the two: Self-reliant | Inquisitive | Pro-phobe (dislikes professionals) | Pro-phile | Start-up | Start-up or Whatever
| Organizationally Orthodox | Organizationally Innovative | Trade Association Member | Web Surfer | Self-sufficient | Virtual | Think Small | Think Big | Small-business Founder | Entrepreneur | Seat-of-the-pants | Business Plan | Boss | Leader | Male | Mixed | Supportive Spouse at Home | Spouse Runs Own Business | Automation | Innovation | Intuition | Education | Research Backwater | Research Mainstream | Price Takers | Value Makers | Personal Financial Plan is the Business | Business is Part of Personal Finance Plan | Art | Science | Equity= Control | Performance=Control | Company | Career |
Professional entrepreneurs today don’t just have great ideas; they have great ideas and know how to plan their execution and know which capital sources to approach. The Economist (1997) states that the firms are surviving because entrepreneurs with sound ideas and limitless energy run them. But they are thriving growing at incredible rates more – in-part because they were financed and helped along by venture capitalists, who took a chance on their potential long before any financial market or bank would touch them.
The media business itself has been moving from broadcasting to narrow casting. All media companies used to produce one identical product – a film, a newspaper or a broadcast television network –, which they offer out to as many consumers as they could. Cable television changed that by starting to fragment the audience. Cable networks had to approach their audiences in a different way to the broadcasters: they had to develop niche programming, which meant thinking about what make people different, not what they had in common.
In future, new media companies will be seen as the prehistoric ancestors of fully evolved narrow casters. For they began a process that the Internet takes much further: bringing company and customer closer together. Consumers can answer back, and so they tell companies what they want. Companies can find out far more about their customers: where they live, where they shop, what music they like, what books they read. The individual relationship between producer and customers is in its infancy; but already, all sort of companies are beginning to sell things differently on the Internet. AOL Time Warner plans to make early use of these possibilities. AOL will, for instance, offer its subscribers free clips from Warner Music: because AOL knows its subscribers, they will be clips of the kind of music those individuals might want to listen to.