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Rupert Murdoch snagged the price he wanted: the nation's premier business newspaper, The Wall Street Journal. The family-controlled Dow Jones Company has owned the paper for a hundred years, but last night, the Dow Jones board accepted Murdoch's $5 billion bid for the company.
Many of the Journal's reporters and editors opposed the deal on the grounds that Murdoch's tabloid brand of journalism doesn't meet their standards of objectivity. Now, they'll have to see if they can stay objective about their new boss.
NPR's David Folkenflik has this report.
DAVID FOLKENFLIK: The deal came together amid anger, angst and ambition. But the logic behind it is simple: Investors felt Dow Jones wasn't making them enough money and Rupert Murdoch's News Corp. was offering a ton of it. Murdoch is also promising to spend more to win back advertisers and subscribers, and to expand coverage. Norman Pearlstine was the top editor for nine years. He says he's fairly hopeful.
Mr. NORMAN PEARLSTINE (Former Managing Editor, The Wall Street Journal): The alternatives for Dow Jones and the Journal were not so great. So on balance, the idea of an owner who wants to invest in and reinvigorate a product is something we should be encouraged about.
FOLKENFLIK: Yet, Pearlstine adds this caveat.
Mr. PEARLSTINE: We have to be weary about whether his record of frequently using his publications for the interest of News Corp. is something that's going to have to be watched.
FOLKENFLIK: And, oh boy, is his old news from wary.
Mr. E.S. BROWNING (Correspondent, The Wall Street Journal): I think that the vast majority of people who work for the Wall Street Journal consider Rupert Murdoch to be a threat to what we do, and I don't think there's any great disagreement about that.
FOLKENFLIK: Long-time reporter E.S. Browning is a senior figure in the paper's union. Some colleagues believe the journal may need new owners with deep pockets and want to give Murdoch the benefit of the doubt. Browning isn't among them.
Mr. BROWNING: There are people who want Rupert Murdoch's money, but I think they'll be unhappy at the price that he exacts in exchange.
FOLKENFLIK: Murdoch will launch a new cable business channel in October. He already owns the Fox News Channel, The New York Post, MySpace, newspapers in the U.K. and Australia, and satellite TV operations in Asia. The Journal's foreign correspondents warned about moves he's taken to appease Chinese leaders.
The 76-year-old Murdoch has been repeatedly accused of influencing coverage, a charge he shrugs off. That issue tore apart the Bancroft family, which holds 64 percent of the voting stock of Dow Jones. Bancroft cousin Leslie Hill quit the Dow Jones board as it and the family moved to endorse the sale. Reporter Joshua Prager writes lengthy feature stories for the Journal's front page. He says the legacy is about to be lost.
Mr. JOSHUA PRAGER (Reporter, The Wall Street Journal): For years, it seemed that there were other principles than just money that were sort of governing and guiding the stewardship of this paper.
FOLKENFLIK: Prager points to the winning gambit this week when News Corp. agreed to pay an estimated $30 million in fees generated by the Bancroft's lawyers, analysts and other consultants.
Mr. PRAGER: That payment was, for many people, sort of emblematic of one bitter truth: that it all comes down to money. And it really, really left a bitter taste in people's mouth.
FOLKENFLIK: Some questioned the advice the Bancroft's received. Merrill Lynch was hired by the Bancroft family's chief trustee to evaluate the Murdoch bid, but it's also part of a banking syndicate that agreed to loan News Corp. $2.25 billion back in May. Merrill Lynch and the Bancroft family trustee declined to comment. For all that, Normal Pearlstine is mildly bullish on Murdoch.
Mr. PEARLSTINE: The bet has to be that he's not going to do anything to destroy a prized asset.
FOLKENFLIK: Once shareholders vote to usher in the Murdoch era, as they're expected to do in a few months, former editor Pearlstine suggests an assignment for the paper's reporters - a hard look at their new corporate owners.
David Folkenflik, NPR News, New York.
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