Update: Rupert Murdoch's excellent adventure
Updated below: Is Rupert Murdoch shrewd or what? Perhaps that MySpace acquisition wasn't a fluke.
Murdoch's News Corp. made an unsolicited bid for Dow Jones and wants to pay a whopping $60 a share. Dow Jones closed at $36.33 on Monday. In a statement, Dow Jones said it's evaluating the offer.
To understand the brilliance of Murdoch's move (see Techmeme discussion) you have to watch a lot of financial news. News Corp.'s Fox is going to launch its own business channel. CNBC, who happens to rely on Dow Jones for content, is the big dog. In one swoop, Murdoch can cripple CNBC just as he's launching his own business news network.
Another thread in this story will be the alleged upside to newspaper companies--don't buy it. At least half of the whopping premium News Corp. is willing to pay for Dow Jones can be attributed to Rupe's desire to bury CNBC.
Nevertheless, it won't kill Rupe to own The Wall Street Journal. After all, he owns the ever-money-losing New York Post for ego and fun. It certainly isn't going to hurt his standing to own The Wall Street Journal too. Besides, Rupe already agrees with the editorial page.
The final thread--and one that'll be overlooked--is the interactive one. With Dow Jones, Rupe would acquire the only real paid content model (outside of porn) that has worked--WSJ.com. Couple WSJ.com, Barrons and Marketwatch and you have a nice collection of online assets to lump in with the Fox business network. MySpace for money managers anyone?
Update 2 p.m. PT: Maybe Rupe's big idea will be delayed a bit as Dow Jones holds out for more dough. In a statement Dow Jones said:
Dow Jones & Company said that a director who is a representative of the Bancroft family, Michael B. Elefante, has informed the Dow Jones Board of Directors that "members of the family and the trustees of trusts for their benefit have advised him that they will vote shares constituting slightly more than 50 percent of the outstanding voting power of Dow Jones as of April 30th excluding options against the proposal submitted by News Corporation to acquire all of the outstanding shares of Dow Jones common stock and Class B common stock for $60.00 per share.''
That's a very long-winded way to say we're holding out to see if General Electric--or Rupe--will up the ante. The argument for upping the Dow Jones price isn't half bad--you could argue that the company is much more information services than newspaper publisher.