Murdoch the chess-player

By Richard Addis
January 20th, 2009 at 12:07am
Media, Newspapers

The Lebedev affair gets more and more fascinating. (For example: another of his journalists was shot in Moscow today, though it looks like she got caught in the crossfire of a gangland hit — so this event probably says something about Moscow but nothing about Lebedev).

The Lebedev affair has had loads of coverage over the weekend. But I do not think anyone has looked at it hard enough from the Murdochian point of view.

1. Rupert Murdoch believes that only two profitable national newspaper companies will be left standing in the UK in ten years time - his own News International and Associated Newspapers. Other papers will still exist, such as The Guardian, but — as ever — they will not be profitable.
2. He is determined that his company will be the biggest and is constantly waging war, either trench war or outright war, on Associated.
3. Thus: The Times has steadily eaten into the profits of The Mail; The Sunday Times does battle with The Mail on Sunday;  The Sun and the News of the World are virtually unchallenged.
4. The two thorns in his flesh are Metro which leeches advertising revenue from The Times and London Lite which blocks any potential profitability for The London Paper.
5. The biggest single key to Metro’s success is its exclusive contract with the London Underground which is up for renewal this year. Murdoch needs either to win this off Metro or push the price up so high that Metro becomes unprofitable. His best option is to make The London Paper a 24 hour operation and attempt to put a free morning edition on the tube.
6. However for The London Paper to be truly profitable there must be no London Lite.
7. The key to London Lite’s ability to survive has been The Standard. With the Standard newsroom in full flow it was not hard to produce London Lite very cheaply.
8. So he spotted the chink in Associated’s armour. With losses at £18m a year the Standard might be prised away. With his son in law Matthew Freud helping to direct the Lebedev campaign, one assumes Murdoch would have known about the plan to buy The Standard. But it would be absolutely vital for him to stay absolutely out of the picture otherwise it would never get sold.
9. Once time has gone by and the contractual restraints that Lebedev will probably have to sign have expired, one might imagine the Lebedev/Freud Standard would move closer to the Murdoch camp, at any rate enough to stop assisting London Lite.
10. London Lite then becomes another drain on the Associated resources. It has to be closed down. If Murdoch can force Metro into making losses - another victory.
11. The Murdoch family then owns the Sun, News of the World, Times, Sunday Times and The London Paper (which by then is profitable and gives away one million copies a day - including a morning edition on the tube).
12. The Rothermere family owns the Mail, Mail on Sunday and possibly a struggling Metro (or possibly not).

Or is this all too Grand Master-ish?

Entry Filed under: Media, Newspapers