1211 Avenue of the Americas, the headquarters of News Corporation
|Traded as||NASDAQ: NWSA (Class A)|
NASDAQ: NWS (Class B)
S&P 500 components
S&P/ASX 50 components
|Defunct||28 June 2013|
|Headquarters||1211 Avenue of the Americas, |
(Chairman and CEO)
(President & COO)
|Products||Cable network programming, Filmed entertainment, Television, direct-broadcast satellite television, Publishing, and other|
|Subsidiaries||List of assets owned by:|
|Website||newscorp.com at the Wayback Machine (archived June 24, 2013)|
The original incarnation of News Corporation (abbreviated News Corp.) was an American multinational mass media corporation operated and owned by media mogul, Rupert Murdoch, headquartered in New York City. Prior to its split in 2013, it was the world's fourth-largest media group in terms of revenue, and News Corporation had become a media powerhouse since its inception, almost dominating the news, television, film and print industries.
News Corporation was a publicly traded company listed on NASDAQ. Formerly incorporated in Adelaide, South Australia, the company was re-incorporated under Delaware General Corporation Law after a majority of shareholders approved the move on November 12, 2004. News Corporation was headquartered at 1211 Avenue of the Americas, New York, in the newer 1960s-1970s corridor of the Rockefeller Center complex.
On June 28, 2012, after concerns from shareholders in response to its recent scandals and to "unlock even greater long-term shareholder value", founder Rupert Murdoch announced that News Corporation's assets would be split into two publicly traded companies, one oriented towards media, and the other towards publishing. The corporate spin-off formally took place on June 28, 2013; where the present News Corp. was renamed 21st Century Fox and consists primarily of media outlets, while a new News Corp was formed to take on the publishing and Australian broadcasting assets.
Its major holdings at the time of the split were News Limited (a group of newspaper publishers in Murdoch's native Australia), News International (a newspaper publisher in the United Kingdom, whose properties include The Times, The Sun, and the now-defunct News of the World--which was the subject of a phone hacking scandal that led to its closure in July 2011), Dow Jones & Company (an American publisher of financial news outlets, including The Wall Street Journal), the book publisher HarperCollins, and the Fox Entertainment Group (owners of the 20th Century Fox film studio and the Fox Broadcasting Company--one of the United States' major television networks).
News Corp was created in 1980 by Rupert Murdoch as a holding company for News Limited. News Limited was created in 1923 in Adelaide; subsequently the controlling interest was bought by The Herald and Weekly Times. In 1949, Sir Keith Murdoch took control of The Adelaide News. When he died in 1952, his son Rupert inherited a controlling interest in an Adelaide afternoon tabloid, The News. News Limited operates today as News Corporation's Australian brand, The Australian operating out of Surry Hills, in Sydney.
News Ltd. made its first acquisition in the United States in 1973, when it purchased the San Antonio Express and News (the two papers merged in 1984). Soon afterwards it founded the National Star, a supermarket tabloid, and in 1976 it purchased the New York Post.
In 1982, News Corp bought a stake of the movie studio 20th Century Fox, buying the other half in 1984. Also in 1984, News Corp bought Travel Weekly and other trade magazines from Ziff Davis. In 1985, News Corp announced it was buying the Metromedia television stations and its syndication arm Metromedia Producers, setting the stage for the launch of a fourth U.S. commercial broadcasting television network. On September 4, 1985, Murdoch became a naturalized citizen to satisfy the legal requirement that only United States citizens could own American television stations. In 1986, the Metromedia deal was completed, and the Fox Broadcasting Company was launched.
In 1986 and 1987, News Corp (through subsidiary News International) moved to adjust the production process of its British newspapers, over which the printing unions had long maintained a highly restrictive grip. A number of senior Australian media moguls were brought into Murdoch's powerhouse, including John Dux, who was managing director of the South China Morning Post. This led to a confrontation with the printing unions National Graphical Association and Society of Graphical and Allied Trades. The move of News International's London operation to Wapping in the East End resulted in nightly battles outside the new plant. Delivery vans and depots were frequently and violently attacked. Ultimately the unions capitulated. In 1987, News Corp acquired Harper and Row and merged with British book publisher William Collins, Sons in 1989 to form HarperCollins.
By 1992, News Corp had gotten huge[clarification needed] debts, which forced it to sell many of the American magazine interests it had acquired in the mid-1980s to K-III Communications, as well spinning off long-held Australian magazines interests as Pacific Magazines. Much of this debt came from its stake in the Sky Television satellite network in the UK, which incurred massive losses in its early years of operation, which (like many of its business interests) was heavily subsidised with profits from its other holdings until it was able to force rival satellite operator BSB to accept a merger on its terms in 1990. (The merged company, BSkyB, has dominated the British pay-TV market since.)
In 1993, News Corp acquired a 63.6% stake of the Hong Kong-based STAR TV satellite network for over $500 million, followed by the purchase of the remaining 36.4% in July 1995. Murdoch declared that:
(Telecommunications) have proved an unambiguous threat to totalitarian regimes everywhere ... satellite broadcasting makes it possible for information-hungry residents of many closed societies to bypass state-controlled television channels.
In 1995, the Fox network became the object of scrutiny from the FCC when it was alleged that its Australian base made Murdoch's ownership of Fox illegal. The FCC, however, ruled in Murdoch's favour, stating that his ownership of Fox was in the public's best interests. It was also noted that the stations themselves were owned by a separate company whose chief shareholder was a U.S. citizen, Murdoch, although nearly all of the stations' equity was controlled by News Corp. In the same year, News Corp announced a deal with MCI Communications to develop a major news website as well as funding a conservative news magazine, The Weekly Standard. In the same year, News Corp launched the Foxtel pay television network in Australia in a partnership with Telstra and Publishing and Broadcasting Limited. On July 17, 1996, News Corp acquired New World Communications (who acquired a stake in 1994) and was completed on January 22, 1997. In October 1996, the Fox Entertainment Group established the Fox News Channel, a 24-hour cable news network to compete against Ted Turner's rival channel CNN.
In 1999, News Corp significantly expanded its music holdings in Australia by acquiring the controlling share in a leading Australian-based label, Michael Gudinski's Mushroom Records, merging it with already held Festival Records to create Festival Mushroom Records (FMR). Both Festival and FMR were managed by Rupert Murdoch's son James Murdoch for several years.
Also mid 1999, The Economist reported that News Corp paid comparatively lower taxes and Newscorp Investments specifically had made £11.4 billion ($20.1 billion) in profits over the previous 11 years but had not paid net corporation tax. It also reported that after an examination of the available accounts, Newscorp could normally have been expected to pay corporate tax of approximately $350 million. The article explained that in practice, the corporation's complex structure, international scope and use of offshore tax havens allowed News Corporation to pay minimal[clarification needed] taxes.
In late 2003, News Corp acquired a 34% stake in DirecTV Group (formerly Hughes Electronics), operator of the largest American satellite TV system, from General Motors for US $6 billion. DirecTV was sold to Liberty Media in 2008 in exchange for its holding in News International.
In January 2005, shortly after reincorporation in the United States, News Corporation announced that it was buying out Fox Entertainment Group. The manoeuvre delisted Fox from the New York Stock Exchange; Fox traded on the NYSE under the ticker FOX.
In July 2005, in one of the company's first major Internet purchases, News Corporation purchased the social networking website Myspace for $580 million. News Corporation had beat out Viacom by offering a higher price for the website, and the purchase was seen as a good investment at the time. Of the $580 million purchase price, approximately $327 million has been attributed to the value of Myspace according to the financial adviser fairness opinion. Within a year, Myspace had tripled in value from its purchase price.
In February 2007, Murdoch announced at the McGraw-Hill Media Summit that Fox would launch a new business news channel later in the year, which would compete directly against rival network CNBC. Murdoch explained that the channel would be more "business-friendly" than CNBC, because he felt that they "leap on every scandal, or what they think is a scandal." In July 2007, News Corp. reached a deal to acquire Dow Jones & Company, owners of The Wall Street Journal, of $5 billion for. Despite CNBC already having a contract with Dow Jones to provide content and services to the network, Fox officially launched the Fox Business Channel on October 15, 2007. Alexis Glick, the network's original morning show host and vice president of business news, indicated that its lawyers had reviewed the details of Dow Jones' contract with CNBC, but noted that it would still "actively use" other Dow Jones properties.
In 2009, News Corp established NewsCore, a global wire service set up to provide news stories to all of News Corp's journalistic outlets.
In 2010, due to the Fijian government's requirement that the country's media outlet must be 90% owned by Fiji Nationals, News Corporation sold 90% of their stake in their Fijian newspapers (Fiji Times, Nai Lalakai, and Shanti Dut) to Motibhai Group of Companies.
In late February 2011, News Corp officially put the now-struggling Myspace up for sale, which was estimated to be worth $50-200 million. Losses from the last quarter of 2010 were $156 million, over double of the previous year, which dragged down the otherwise strong results of parent News Corp. Its struggles were attributed to the growth of the competing social network Facebook. The deadline for bids, May 31, 2011, passed without any above the reserve price of $100 million being submitted. The rapid deterioration in Myspace's business during the most recent quarter had deterred many potent suitors. Later in June, Specific Media and pop singer Justin Timberlake bought the site for $35 million, which CNN reported noted was "far less than the $580 million News Corp. paid for Myspace in 2005." Murdoch went on to call the Myspace purchase a "huge mistake".
On July 13, 2011, Rupert Murdoch announced that the company would withdraw its takeover bid for BSkyB due to concerns relating to the News of the World scandal. News Corporation already owned, and continues to own, 39.1% of BSkyB.
On June 6, 2012, News Corporation announced that it would buy out ESPN Inc.'s stake in ESPN Star Sports to gain full control over the Asian sports network. In January 2013, News Corp. attained 54.5% majority control of Sky Deutschland.
On February 4, 2013, News Corporation announced the sale of IGN and its related properties to the publishing company Ziff Davis. News Corp. had planned to spin off IGN as an independent company, but failed to do so.
In July 2011, News Corp closed down the News of the World newspaper in the United Kingdom due to allegations of phone hackings. The allegations include trying to access former Prime Minister Gordon Brown's voice mail, and obtain information from his bank accounts, family's medical records, and private legal files. Allegations of hacking have also been brought up in relation to former Prime Minister Tony Blair, and the Royal Family. Other allegations put out by The Guardian newspaper include the exploitation, with intent to gain access to or use private information, of a list of 4,332 names or partial names, 2,987 mobile phone numbers, 30 audio tapes of varying length and 91 PIN codes, of a kind required to access the voicemail of the minority of targets who change the factory settings on their mobile phones. The names are said to include those of British victims of September 11, 2001 terror attacks, family members of victims of the "7/7" bombings on London's transit system, family members of British troops killed overseas, Milly Dowler, a 13-year-old missing British girl who was later found dead, actor Hugh Grant and a lawyer representing the family of Princess Diana's lover at the inquest into her death.
Allegations about the violation of ethical standards by the News Corporation subsidiary News of the World have been speculatively applied to News Corporation holdings in the United States. Senator John Rockefeller (D-WV) stated on July 12, 2011 that there should be a government investigation into News Corporation "to ensure that Americans have not had their privacy violated." His statement was echoed on Wednesday by Sen. Robert Menendez (D-NJ), who specifically requested an investigation into 9/11 victims, as well as Sen. Frank Lautenberg (D-NJ) who encouraged an investigation by the Securities and Exchange Commission. On July 13, 2011, Representative Peter King (R-NY) wrote a letter to the FBI requesting an investigation into News Corporation's ethical practices, and on July 14, the FBI opened a probe into the hacking of 9/11 victims. Les Hinton, chief executive of the media group's Dow Jones, resigned on July 15, saying, "I have seen hundreds of news reports of both actual and alleged misconduct during the time I was executive chairman of News International and responsible for the company. The pain caused to innocent people is unimaginable. That I was ignorant of what apparently happened is irrelevant and in the circumstances I feel it is proper for me to resign from News Corp, and apologize to those hurt by the actions of the News of the World."
In 2012, following a BBC Panorama report, allegations were made that News Corp subsidiary NDS Group had used hackers to undermine pay TV rivals around the world. Some of the victims of the alleged hacking, such as Austar, were later taken over by News Corp and others such as Ondigital later went bust. NDS had originally been set up to provide security to News Corp's pay TV interests but emails obtained by Fairfax Media revealed they had also pursued a wider agenda by distributing the keys to rival set-top box operators and seeking to obtain phone records of suspected rivals. The emails were from the hard drive of NDS European chief Ray Adams. In 2012, it was also revealed that Australian Federal police were working with UK police to investigate hacking by News Corp.
On June 28, 2012, Rupert Murdoch announced that, after concerns from shareholders in response to the recent scandals and to "unlock even greater long-term shareholder value", News Corporation's assets would be split into two publicly traded companies, one oriented towards media, and the other towards publishing. News Corp's publishing operations were spun out into a present-day News Corporation with Robert James Thomson, editor of The Wall Street Journal, as CEO. The present News Corporation, which retains most of its media properties (such as the Fox Entertainment Group and 20th Century Fox) and Murdoch as CEO, was renamed 21st Century Fox. Murdoch remains chairman for both companies.
Shareholders approved the split on June 11, 2013. On June 19, 2013, preliminary trading for the new News Corp on the Australian Securities Exchange commenced in preparation for the formal split that was finalized on June 28, 2013. Shareholders received one share of New News Corp for every four shares they owned of the old News Corp. The two new companies began trading on the NASDAQ on July 1, 2013. 21st Century Fox and most of its businesses were later acquired by the Walt Disney Company in 2019; its US broadcast, sports, and news assets were spun-off to Fox Corporation which would be retained under Murdoch ownership.
News Corporation organises an annual management conference, discussing media issues related to geopolitics. Attendees include News Corporation executives, senior journalists, politicians and celebrities. Previous events were in Cancún, Mexico, and the Hayman Island off the coast of Australia. The events are private and secretive, there are no records available for the agenda or talks given at the conferences, and no uninvited journalists are permitted access.
The 2006 event in Pebble Beach, California was led by Rupert Murdoch. According to a copy of the agenda leaked to the Los Angeles Times and other media accounts, issues discussed related from Europe to broadcasting and new media, terrorism to the national policy. The event included speeches from Murdoch, Governor Arnold Schwarzenegger, former British Prime Minister Tony Blair, Bono, Al Gore, Senator John McCain and Bill Clinton while Israel's President, Shimon Peres, appeared on a panel named "Islam and the West". Other notable attendees included Newt Gingrich and Nicole Kidman.
In anticipation of US midterm elections, News Corp. donated $1 million to the Republican Governors Association in June 2010. The move was criticised by Democrats, who said this was evidence of News Corp's media outlets conservative leanings (see Fox News Channel controversies). The Democratic Governors Association also criticised the donation and demanded more transparency in the reporting by News Corp companies. DGA head Nathan Daschle wrote to the chairman of News Corp company Fox News, Roger Ailes: "In the interest of some fairness and balance, I request that you add a formal disclaimer to your coverage any time any of your programs covers governors or gubernatorial races between now and election day."
Around the same time, News Corp. also donated $1 million to the United States Chamber of Commerce. The Chamber aggressively supported the Republican effort to retake Congress in 2010. This donation and an earlier $1 million contribution that News Corp. made to the Republican Governor's Association led media critics to question whether the company had crossed an ethical line for a media company.
The company's Board of Directors consisted of 16 individuals at the time of its break up:
List of companies and businesses owned by News Corporation prior to its formal split on June 28, 2013. All media and broadcasting assets, except media assets owned by News Limited, now belong to The Walt Disney Company and Fox Corporation (successors to 21st Century Fox), its legal successors. Meanwhile, newspapers and other publishing assets, including media assets under News Limited, were spun off as a new News Corp.
News Corp agreed to sell eight of its television stations to Oak Hill Capital Partners for approximately $1.1 billion as of December 22, 2007. The stations are US Fox affiliates. These stations, along with those already acquired by Oak Hill that were formerly owned by The New York Times Company, formed the nucleus of Oak Hill's Local TV LLC division.
Cable TV channels owned (in whole or part) and operated by News Corporation include: