Birthday parties in pandemics are dreary, even for billionaires. But Rupert Murdoch’s 90th, which he will celebrate on March 11th, should at least be less stressful than his 80th. Back then British detectives were burrowing into a subsidiary of his firm, News Corporation, then the world’s fourth-largest media company, for evidence that its journalists had hacked phones and bribed police. Several convictions later, and following the closure of the 168-year-old News of the World, Mr Murdoch was hauled before a British parliamentary inquiry on what he called “the most humble day of my life”.

A decade on from the near-collapse of his empire, things are going rather better for the Australian-born tycoon. The phone-hacking scandal has receded. The choicest assets in his collection have been sold to Disney at the top of the market. Fox News is America’s most popular (if also its most despised) cable channel. And in a coup last month, Mr Murdoch forced tech giants to pay for linking to his content. “He has the money. He has huge amounts of political power. He has it all,” says Claire Enders, a veteran media-watcher.
As he prepares to pass it all on, the outlook is clouding over. Cable television is in hastening decline. A looming legal problem could prove even costlier than the phone-hacking affair. And the succession question—a decades-long saga which HBO, a rival network, cheekily dramatised—lingers on. Mr Murdoch is still the force that holds together a formidable commercial and political project. It may not stay intact without him.
The humbling experience of the phone-hacking affair turned out to be a blessing. It forced Mr Murdoch to split News Corporation in two, putting the lucrative TV and film assets into 21st Century Fox (which analysts nicknamed “Good Co”). The scandal-hit newspapers were quarantined in News Corp (“Crap Co”). As the firms were modernised and power devolved to Mr Murdoch’s sons, Lachlan and James, investors returned. In his boldest move, in 2019, the great consolidator of the media business realised that it was time to become prey rather than predator, and sold most of the 21st Century film and TV business to Disney for $71bn. Ms Enders and colleagues calculate that since 2011 the holdings of the Murdoch family trust, which has nearly 40% of voting shares in each company, have appreciated more than six-fold.

The next chapter will be trickier. Start with Fox, the larger company, with a market capitalisation of $22bn. The pandemic has sped the decade-long decline of American cable TV. Last year cable subscriptions fell by 7.3%, to levels not seen in nearly 30 years. Fox, whose gross operating profit last financial year was $2.8bn, has been insulated from this trend by its focus on news and sport, which streaming companies have yet to snatch. But something has changed. Whereas Fox used to trade at a premium to ViacomCBS and Discovery, two cable rivals, it now trades at a 30% discount (see chart 1).
One reason is that the streamers are coming for sport. Amazon already covers the National Football League and is reportedly looking to acquire exclusive rights to some American-football games. Leagues want to reach young fans, and cannot get them on cable TV, where two-thirds of viewers are over 50. So cable companies are moving sport onto their own streaming services. Disney has ESPN+; Comcast announced in January that it would shut down its NBC Sports Network and shift programming to its Peacock service. Michael Nathanson, a media analyst, notes that without a streaming platform for sports, Fox is “the odd man out”.
Fox News, where Fox made about 80% of its money last year, has problems of a different sort. Its close relationship with Donald Trump’s White House generated record ratings, but alienated advertisers and some investors. “Any company you hold, you want to see behave ethically,” says one large shareholder. Fox is “in that grey area right now. It’s defensible, but it’s far less defensible than it was.” Smartmatic, an election-software company, is suing the company for $2.7bn for airing ludicrous claims that it rigged the presidential election. (Fox says it will fight the “meritless” lawsuit.) That sum would exceed the phone-hacking payouts.
Fox has reined in its support for Mr Trump, only to see viewers depart for ultra-conservative upstarts like Newsmax and One America News. Fox News remains the most-watched cable channel in primetime. But viewership in February was down by 30%, year on year, even as that of its rivals, CNN and MSNBC, rose by 61% and 23%. One former Fox executive observes that, like Mr Trump’s Republican Party, Fox News was trapped into “super-serving” an ultra-conservative minority of its audience. Now it risks losing it, without attracting less kooky viewers.

Ironically, “Crap Co” is having a better time. Newspapers in America, Britain and Australia provide the largest chunk of its revenue, followed by Australian pay-TV and HarperCollins publishing. But the biggest contributor to profits is its majority stakes in REA Group and Move, two online real-estate advertising companies (see chart 2). News Corp’s share price has nearly trebled from its trough last April, thanks in large part to a surge in REA’s shares.
Like Fox, the newspapers have had to deal with a global shift of advertising online. Ten years ago the Murdoch companies were collectively the world’s third-largest seller of ads, says Brian Wieser of GroupM, the biggest media-buyer. Now they are outside the top ten. But the newspapers are further along the digital transition than Fox is. Online subscriptions account for three-quarters of the total at the Wall Street Journal; even the New York Post, a perennially loss-making tabloid, reported a modest profit in the last quarter of 2020. A recent deal with Google will see the tech colossus pay News Corp for content as a result of a law passed by the Australian government, which News Corp’s papers have backed. “The terms of trade for content are changing fundamentally,” Robert Thomson, News Corp’s chief executive, said on March 4th.
Still, with a market capitalisation of less than $14bn, News Corp is worth less than the sum of its eclectic parts. Mr Thomson insists it is on a “course of simplification”, having sold assets such as Amplify, an online education business, and Unruly, a video-ad platform. Many analysts think it should go further and separate the news businesses from the real-estate ones. At the moment, investors seeking growth are attracted by the property portfolio but put off by the legacy news brands, whereas investors looking for value like the newspapers but not the real estate.
Some also see a case for breaking up Fox. Mr Nathanson has argued that the firm should sell its broadcast-TV assets and sports channels, which the market seems to undervalue. Perhaps even Fox News could be spun off, if a buyer could be found: the brand is so controversial that it is all but unsellable, Ms Enders believes. A full leveraged buyout of Fox could generate an annualised return on investment of roughly 25% over five years, calculates Morgan Stanley, an investment bank.

The biggest impediment to restructuring either firm’s portfolio may be Mr Murdoch himself. When power is eventually handed down, “a break-up story will gain momentum,” believes Brian Han of Morningstar, a broker. Will the next generation be willing to carve the empire up? And which of them will call the shots?
The son wot won it
Lachlan is already installed as chief executive of Fox and co-chairman of News Corp. At Fox he has backed Tubi, an ad-supported streaming service, sports-betting ventures and Credible Labs, a credit-scoring agency. None is an obvious fit with the core news business. Insiders think he would be reluctant to trim the legacy assets. Particularly in Australia, “there is a lot of history that [Lachlan] feels very deeply part of,” says a former News Corp executive. “It doesn’t lend itself to clear-headedness.” Lachlan has “stars in his eyes” and wants to build the family empire back up through acquisitions, believes one disapproving shareholder (who also fumes at Lachlan’s recent purchase of the most expensive home in Los Angeles).

Whatever he wants, Lachlan may not get his way. On Rupert’s death, control of the family trust will pass to his four eldest children. James, who now has little to do with his father and brother, has made clear his disapproval of the right-wing editorial line and does not seem attached to the legacy businesses. Elisabeth has warned of the dangers of “profit without purpose” in the media. With their elder sister Prudence, who keeps a lower profile, they could alter the course of both companies.
If the future of the firms is determined not just by commercial logic but by family politics, that would be fitting. The assets in play are political as much as they are economic. The purpose of the Murdoch empire has always been to wield power as well as to make money. “What is Fox News for?” asks a former executive. “Fomenting insurrection.” Both Fox and News Corp may yet face one themselves. More

In this articleEMNCNBC’s Jim Cramer said Thursday he sees opportunity for investors to buy shares of Eastman Chemical at an attractive price.”With the harsh pullback over the last couple weeks, including today’s nearly 4% slide, I think Eastman’s becoming a lot more compelling,” the “Mad Money” host said.Eastman Chemical shares closed Thursday’s session at $116.97, down about 10% from its 52-week high of $130.47 on June 1.However, Cramer said he feels confident the stock has more upside from current levels due, in part, to his outlook on inflation and monetary policy from the Federal Reserve. Cramer said he still believes an interest rate hike from the Fed is years away, meaning it’s an attractive environment for cyclical stocks like Eastman Chemical to do well.”Of course, if you’re worried about the Fed, this is not the stock for you,” Cramer cautioned.Recent comments from the CEO of another chemical company, LyondellBasell, also inform Cramer’s optimistic outlook toward Tennessee-based Eastman Chemical, which makes a wide range of products including hydraulic fluids for airplanes and plastics.In an interview Wednesday on “Mad Money,” LyondellBasell CEO Bob Patel told Cramer he expects the supply-and-demand picture to remain out of balance for a while, saying the “business environment is going to be stronger for longer.”Cramer said remarks like Patel’s allow him to overlook Thursday’s rotation out of cyclical stocks because of “misguided” rate-hike worries.”I think you’re getting a terrific chance to buy some Eastman Chemical, which has great execution and also gives you the best sustainability kicker from [a plastics maker] that I have seen yet,” Cramer said.Questions for Cramer? Call Cramer: 1-800-743-CNBCWant to take a deep dive into Cramer’s world? Hit him up! Mad Money Twitter – Jim Cramer Twitter – Facebook – InstagramQuestions, comments, suggestions for the “Mad Money” website? madcap@cnbc.com More

In this articleBALMTGMLockheed Martin and General Motors are partnering to develop a new type of lunar vehicle for NASA to use during its upcoming Artemis missions to the moon, the companies announced Wednesday.”Surface mobility is critical to enable and sustain long-term exploration of the lunar surface. These next-generation rovers will dramatically extend the range of astronauts,” Lockheed Martin executive vice president Rick Ambrose said in a statement.Earlier this year, NASA issued a notice to companies that it “requires a human-class rover that will extend the exploration range of” astronauts during missions for the agency’s Artemis program. The NASA program, announced by former President Donald Trump’s administration and continued under President Joe Biden, consists of multiple missions to the moon’s orbit and surface in the years ahead.NASA’s request for a next-generation lunar vehicle noted it should utilize a variety of cutting-edge technologies, including electric vehicle systems, autonomous driving, and hazardous terrain capabilities.GM has built such a vehicle before, as the company was the major subcontractor that helped Boeing create the lunar roving vehicle that was utilized during three Apollo missions on the moon.Apollo 16 astronaut John Young drives NASA’s Lunar Roving Vehicle (LRV) at the Descartes landing site on the Moon on April 21, 1972.Charles Duke | NASAWhile NASA’s previous rover was capable of reaching nearly driving around the moon at nearly six miles per hour, it traveled less than five miles from the Apollo landing site.Lockheed Martin said its next-generation lunar terrain vehicle is “being designed to traverse significantly farther distances to support the first excursions of the moon’s south pole, where it is cold and dark with more rugged terrain.”—CNBC’s Mike Wayland contributed to this story.Become a smarter investor with CNBC Pro.Get stock picks, analyst calls, exclusive interviews and access to CNBC TV. Sign up to start a free trial today. More

3M Chairman and CEO Mike Roman told CNBC on Monday that he was not happy to find out that N95 respirator masks, which health-care workers need to protect themselves from the coronavirus, were available at some retail stores. “It’s disappointing when you see that because we’re trying to redirect everything to health-care workers,” Roman said on […] More

WarnerMedia CEO Jason Kilar will be stepping down from his role as the company’s merger with Discovery nears its close.
Kilar, the one-time CEO of Hulu, was named the head executive of AT&T’s WarnerMedia division in April 2020, a month into the pandemic.
The executive is expected to depart on Friday.

Jason Kilar attends The 15th Annual CNN Heroes: All-Star Tribute at American Museum of Natural History on December 12, 2021 in New York City.
Dominik Bindl | Getty Images Entertainment | Getty Images

WarnerMedia CEO Jason Kilar will be stepping down from his role as the company’s merger with Discovery nears its close.
Kilar made the announcement to employees via email on Tuesday before appearing on CNBC’s “Tech Check.”

“I have been here almost a year since the deal was announced for a couple simple reasons,” Kilar told CNBC’s Julia Boorstin. “One, I love the team, the mission, I love this company. There was never a doubt in my mind I was going to stay through the end until the transition.”
Kilar, the one-time CEO of Hulu, was named the head executive of AT&T’s WarnerMedia division in April 2020, a month into the pandemic. He began the role in May with the launching of streaming platform HBO Max. He also was responsible for making the controversial decision last year to release all Warner Bros.’ movies, both streaming and in theaters.
Kilar, who has long lamented that the upcoming Discovery transaction would ultimately lead to his departure, is expected to leave the job on Friday. The executive has been open about his disappointment that he will leave the company, but has not publicly said what is ahead for him.
“I don’t have any grand proclamations,” Kilar said about his future. “I’m not going to a beach to retire. I’m excited about what comes next. Right now, I am focused on WarnerMedia.”
David Zaslav, the chief executive of Discovery, will take over the combined company once the merger is finalized.

Read Kilar’s full email to employees:

With the pending transaction with Discovery nearing close, now is the right time to share with each of you that I will be departing this amazing company.There are many feelings one could have in a moment like this, but for me there are none bigger, or more lasting, than the feelings of gratitude and love that I have for this team, this company, and this mission. I’ve never been more fulfilled professionally. I’ve never been happier professionally. This team — and what we’ve built together — are the reasons for that. We’re leading the industry creatively. We’ve elevated technology, product, and design to the highest levels in the company. We’re operating as one team, proudly and successfully going direct to consumers across the globe. It has been deeply gratifying to lean into the future alongside each of you and to do so with conviction.The joys are many, especially the walk-and-talks that I’ve had with a great many WarnerMedia team members, diving deeply into the matters at hand, whether on the storied lot in Burbank, along The High Line at Hudson Yards, in and around Techwood and CNN Center, inside our archives, across the expansive lot at Leavesden, at any of our game studio locations, or the many other locations where this team quite literally changes the world. Apparently, word has gotten around that when Jason calls for a walk-and-talk, be sure to wear comfortable walking shoes!For those of you that know me well (or follow me on Twitter), it comes as no surprise that I adore our history and the footprint we have as a company across the globe. I’ve done my best to visit and get to know as many of you as possible and to photographically document my love for this team and this company along the way via social media. So, when my wife Jamie and I were thinking about what we could do on our own to adequately express our appreciation to each of you, we came up with the idea to create a series of artifacts featuring some of the photos I’ve taken to celebrate this team and WarnerMedia. We’re inviting each of you to visit this website and choose an image that resonates . . . from the iconic Warner Bros. water tower, the gleaming towers of Hudson Yards, the virtual production stage in Leavesden, and several more. An artifact featuring that image (and a note from me on the back) will be shipped to you in the coming weeks. Our hope is that this memento will bring a smile and remind you of the important contributions we’ve made to the 99-year legacy of this extraordinary company.Leading this team has been the honor of my lifetime. My heart is so full, and I am beyond thankful to each of you. There is no better team on the planet, and I will savor every last step as I wander the lot in Burbank several more times this week, with this team on my mind, always.

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