MxMIndia

Tag: The Times

  • Move to enhance strategic alignment and increase operational flexibility which would create two category-leading public companies

    News Corp announces intent to split news & ent biz

    By A Correspondent

     

    News Corporation announced that it intends to pursue the separation of its publishing and media and entertainment businesses into two distinct publicly traded companies.

     

    Upon closing such a transaction, shareholders would hold interests in a publishing company, consisting of the largest collection of best-in-class publishing assets and a new digital education group, and a global media and entertainment company, each of which would benefit from enhanced strategic alignment and increased operational flexibility with respect to an unparalleled portfolio of assets, brands and franchises.

     

    News Corporation’s board authorized management to explore this separation after a board meeting.

     

    The proposed transaction would create global category leaders in both publishing and entertainment: a publishing company, which would be comprised of News Corporation’s newspapers and information businesses in the US, UK and Australia, the Company’s leading book publishing brands, its integrated marketing services company, its digital education group, as well as its other assets in Australia; and a global media and entertainment company, which would encompass News Corporation’s broadcast and worldwide cable networks, leading film and television production studios, television stations and highly successful pay-TV businesses in Europe and India.

     

    “There is much work to be done, but our Board and I believe that this new corporate structure we are pursuing would accelerate News Corporation’s businesses to grow to new heights, and enable each company and its divisions to recognize their full potential – and unlock even greater long-term shareholder value,” said Rupert Murdoch, Chairman and CEO of News Corporation.

     

    “News Corporation’s 60-year heritage of developing world-class media brands has resulted in a large and unparalleled portfolio of diversified assets. We recognize that over the years, News Corporation’s broad collection of assets have become increasingly complex. We determined that creating this new structure would simplify operations and greater align strategic priorities, enabling each company to better deliver on our commitments to consumers across the globe. I am 100 per cent committed to the future of both the publishing and media and entertainment businesses and, if the Board ultimately approves a separation, I would serve as Chairman of both companies,” he added.

     

    News Corporation believes that a separation of the businesses into distinct public corporations with their own identities and strategies would enhance overall shareholder value and allow each company to:

    • Focus on and pursue distinct strategic priorities and industry-specific opportunities that would maximize their long-term potential.
    • Benefit from greater financial and operational flexibility and better position each company to compete.
    • Respond and react more quickly to rapidly-evolving technology and global market opportunities.
    • Tailor its capital structure, and allocate and deploy resources in a manner consistent with its strategic objectives that best enhances value for its respective shareholder group.

     

    With more focus devoted to each business’ financial and operational structure, investors would be able to more clearly evaluate the inherent value of both portfolios of assets and invest in each company accordingly.

     

    The new global media and entertainment company that would be created through the proposed transaction would consist of News Corporation’s highly-profitable cable and television assets, filmed entertainment, and direct satellite broadcasting businesses, including Fox Broadcasting, Twentieth Century Fox Film, Twentieth Century Fox Television, Fox Sports, Fox International Channels, Fox News Channel, Fox Business Network, FX, Star, the National Geographic Channels, Shine Group, Fox Television Stations, BSkyB, Sky Italia and Sky Deutschland, among others.

     

    As a pure-play content producer and distributor, the company would build on its deep heritage in developing incredibly strong, premium content for distribution on screens of all sizes by leveraging its leading content across its entertainment and cable news verticals, as well as its unparalleled collection of regional sports networks, and the industry’s leading movie and TV production and distribution company.

     

    In addition, the entertainment company would benefit from its rapidly growing, high-margin cable network and pay-TV assets, and the distribution capabilities and opportunities associated with its unrivaled global footprint with significant scale across North and South America, Europe and Asia.

     

    The new global publishing company that would be created through the proposed transaction would consist of News Corporation’s current publishing businesses, as well as its book publishing, education and integrated marketing services divisions. The new publishing company would create a scaled publishing platform that would be one of the best capitalized in the industry. The publishing company would have the opportunity to leverage its trusted brands for innovation and value creation across all traditional and digital platforms.

     

    The publishing company would incorporate some of the world’s most successful print, digital and information services brands including Dow Jones, The Wall Street Journal, Dow Jones Newswires, HarperCollins, The New York Post, and The Daily, as well as offer the rich diversity of assets in Australia, including leading brands such as The Australian, The Herald Sun, The Daily Telegraph and The Courier Mail.

     

    In addition, the Company would include The Times, The Sun, The Sunday Times, as well as News Corporation’s integrated marketing services group and its ground-breaking digital education group, including Wireless Generation. With a balanced portfolio of stable and growing news publishing brands and other assets, shareholders would benefit from strong and consistent free cash flow generated by these businesses, over multiple platforms.

     

    Upon closing of the proposed transaction, News Corporation’s shareholders would receive one share of common stock in the new company for each same class News Corporation share currently held. Following the separation, each company would maintain two classes of common stock: Class A Common and Class B Common Voting Shares.

     

    Upon closing of the proposed transaction, Rupert Murdoch would serve as Chairman of both companies and CEO of the media & entertainment company. Chase Carey would serve as President and COO of the media & entertainment company.  Over the next several months, the Company will assemble management teams and Boards of Directors for both businesses.

     

    The separation is expected to be completed in approximately 12 months. Management is developing detailed plans for the Board’s further consideration and final approval. To execute the transaction requires further work on structure, management, governance, and other significant matters.

     

    After receiving final approval of the Board of Directors, News Corporation will convene a special shareholder meeting to consider the transaction.  This meeting is not expected to take place until the first half of calendar 2013.  During the closing process, News Corporation will remain focused on delivering the best possible results for the benefit of its consumers, customers and shareholders.

     

    In addition to shareholder approval, the completion of the separation will also be subject to receipt of regulatory approvals, opinions from tax counsel and favorable rulings from certain tax jurisdictions regarding the tax-free nature of the transaction to the Company and to its shareholders, further due diligence as appropriate, and the filing and effectiveness of appropriate filings with the U.S. Securities and Exchange Commission.

     

    The Company will provide interim updates as appropriate.  There can be no assurances given that the separation of the Company’s businesses as described in this announcement will occur.

     

  • The coming years will see massive newspaper wars because the category is on the decline curve. And each brand will have to be very smart and proactive to survive.

    Anil Thakraney: So then what must The Hindu do?

    By Anil Thakraney

     

    The Times is on a rapid expansion drive. They’ve recently launched multiple editions in Kerala, including in small towns. This is quite understandable. Newspapers are in a slow death mode in large towns, and it makes sense to penetrate as many towns as possible to delay the inevitable demise of the newspaper as we know it.

     

    And this portends a serious challenge for incumbent brands. How can they protect their turf? How can they retain their readers in the face of stiff competition? It’s not going to be an easy task. The Times, which is a powerful challenger, has many strengths – the group has deep pockets, tremendous marketing fire power and the newspaper is wholesome; a healthy mix of serious news and entertainment. If the local brands remain lazy and complacent, they will struggle hard, that’s for sure. Deccan Herald learnt this lesson the hard way in Bangalore.

     

    Let’s take the current battle raging between The Hindu and The Times in Chennai as an example. The ad war between the two has already been discussed, and I mentioned in the Debrief section of this portal that I quite like The Hindu’s spirited fight back. But in terms of the content itself, what can the newspaper do to stay alive and relevant? This is a tough one; but allow me to put forward two critical points: The Hindu must NOT dump its image of an ultra serious brand. This is the newspaper’s core strength, it has been so for many decades, and it must be protected.

     

    If they attempt to emulate Times’s please-all mix, they will become a me-too brand and quickly lose the battle. Sticking to their core values will ensure they don’t disillusion their loyal readers. However, at the same time, they have to win over the hearts and minds of younger readers. Already, there is pressure from the internet, so this is going to be a huge problem. The Times is, anyway, particularly strong in its youth appeal. The trick here is not to dumb down the content and dive into a full on filmi and party coverage.

     

    The youth of India aren’t dumb. Yes, they enjoy entertainment coverage, but they also have their own serious issues to worry about, which include education and career opportunities. And this is what The Hindu must tap into very aggressively.

     

    The Express tries to do that but they haven’t achieved much success, and that’s because they are pretty clinical in their approach, and don’t make enough song and dance. The style of presentation and the marketing of youth-related stuff is critical. Features on career prospects don’t have to be boring; they can be made to rock. And marketed in such a way that the youth of Chennai perceives The Hindu to be a newspaper that understands their needs and concerns.

     

    As I said, it’s going to be a tough one. And I used The Hindu only as an example. The coming years will see massive newspaper wars because the category is on the decline curve. And each brand will have to be very smart and proactive to survive. Interesting times await!

     

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    PS: I am not a huge fan of authors who parade themselves at Litfests. And an even lesser fan of authors who tweet. I have always believed writers must remain enigmatic and should be known only through their books. That, the mystery enhances a writer’s appeal. Here’s an interesting article from The New York Times, it  explains the authors’ obsession with Twitter.

     

    Link: http://www.nytimes.com/2012/01/08/books/review/why-authors-tweet.html?_r=2&smid=tw-nytimes&pagewanted=all