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News Corp. reviews costs; Wall Street Journal offers buyouts

June 25, 2013|By Meg James
  • The Wall Street Journal is offering some buyouts in advance of the corporate split. PICTURED: Former Wall Street Journal managing editor Robert Thomson, who is becoming CEO of the new News Corp., and WSJ Magazine Editor in chief Kristina O'Neill.
The Wall Street Journal is offering some buyouts in advance of the corporate… (Evan Agostini / Invision…)

Rupert Murdoch wants his newspapers lean and mean for their roll-out on Wall Street.

On Friday, Murdoch will have completed the breakup of his media empire. One company — News Corp. — will consist of Murdoch's newspapers, including the Wall Street Journal, HarperCollins book publishing, Amplify, an educational materials company and some Australian TV operations.

The other company — 21st Century Fox — will consist of the 20th Century Fox film and television studios, Fox Broadcasting, FX Networks, Fox Sports and the Fox News Channel. 

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While investors are excited about 21st Century Fox, whose assets are seen has having the best growth potential, there is concern about News Corp. because its holdings are primarily in the troubled print industry.

With that in mind, operations on the print side of the company are receiving greater scrutiny. Publications within Murdoch's vast empire have been reviewing operations and in some cases trimming staff. Already the Times of London and the New York Post have eliminated some employees.

The review coincides with the ongoing consolidation of newsrooms of the Wall Street Journal and Dow Jones newswires, which was announced months ago.

Company executives say the moves are designed to better focus resources and delete duplication as the company prepares to spring to life as a stand-alone publicly traded company. 

"We will be relentless in our cost-cutting and in our pursuit of profits," Robert Thomson, former managing editor of the Wall Street Journal and incoming chief executive of the soon-to-be reconstituted News Corp., told investors late last month during a day of presentations.

"But we will also be a resolutely creative company — creativity will not be the preserve of the few but the mission of the many," Thomson said.

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Tuesday, Gerard Baker, managing editor of the Wall Street Journal and editor in chief of Dow Jones & Co., acknowledged that the nation's largest newspaper also was undertaking a "limited restructuring" that would result in layoffs.

Baker made the disclosure in an email to staff members to announce a new world editor and to provide an update of the integration of the newsrooms of Dow Jones newswires and the Journal.

"The animating idea behind integration has always been a cohesive news organization, one that eliminates duplication and better deploys our joint reporting and editing resources to areas of coverage where we can have most impact," Baker wrote. 

While the Journal planned to shed some employees, it also intends to make at least a dozen hires, including reporters to cover technology, mergers and central banking.

"We will post at least a dozen new positions immediately, and more jobs will be posted in weeks and months to come," Baker said. "In the process of integrating our resources, we will be undertaking a limited restructuring around the world that will result in some consolidation of positions.  And as the end of the fiscal year approaches, as is usual practice, some of our colleagues are taking buyout packages."

The moves were described as a reallocation of staffing that would not result in a substantial reduction. Dow Jones and the Wall Street Journal have about 2,000 editorial staff combined. 

A Journal spokeswoman confirmed that both the Journal and Dow Jones remain profitable. Other publications, including the New York Post, operate at a deficit, according to others who are familiar with the finances.

Monday marks the first day of trading for shares in the companies.


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