June 2012

News Corp board approves split plan

Directors of News Corp have approved a proposal to split Rupert Murdoch’s $50 billion empire in two, according to people familiar with the matter, setting the stage for an announcement of a move many thought the 81-year-old proprietor would never countenance.

After a board meeting in New York, chaired by Murdoch, formal confirmation of a separation of its entertainment and publishing arms was expected to come before a planned appearance by News Corp’s chairman and chief executive on Fox Business Network, one of the group’s cable channels. Completing a separation could take a year. The Wall Street Journal reports that one company will house entertainment businesses like 20th Century Fox, Fox broadcast network and Fox News Channel while another houses the publishing assets, which include The Wall Street Journal and the Times of London along with HarperCollins book publishing and News Corp.'s education business.

Murdoch the magician is running out of tricks

[Commentary] Rupert Murdoch has a few things in common with Warren Buffett. They are both 81, they both love newspapers and they both run public companies named after their worst investments from the past. Mr Buffett’s is Berkshire Hathaway , a New England textile company, Mr Murdoch’s is News Corp. The difference is that Mr Buffett still has sufficient credibility with his investors to keep on acquiring newspapers out of a blend of old-fashioned enthusiasm and an eye for a bargain. Mr Murdoch does not and the restructuring of his company is an admission of this defeat. For Mr Murdoch, breaking up News Corp is as wrenching as dividing his entertainment head from his newspaper heart. It is also a sobering moment for the news industry as a whole. If Mr Murdoch can no longer protect his newspapers within his empire, who else can do so apart from highly-motivated billionaires?

Leaving Alabama Behind

[Commentary] The Mobile Press-Register, is going exclusively online four days a week — like our partner publications The Birmingham News, The Huntsville Times and The New Orleans Times-Picayune. Who wants to wait for the whop of a rolled paper on the porch every morning when its contents can be had in real time, with just a click? The physical editions aren’t disappearing entirely; Wednesday, Friday and Sunday papers will be offered in old-fashioned newsprint as well. But the news on other days will be available only on the Internet, for those who are wired. Which raises a question: Given how many Alabamians don’t have regular Internet access, what will they be missing? Let’s play this history game: what stories of special interest to Alabamians, and the nation, were published in newspapers on Monday, Tuesday, Thursday and Saturday? How will stories like these reach readers who are not connected to the Internet? TV and radio will deliver the basics. Countless folks I’ve profiled in my home state have been old, poor or seen as marginal; they live down rural lanes or speak English as a second language. Yet they clutch the paper when it’s in their hands. They are hungry, too, for news of their community, town, state and nation seven days a week.

Delaware Lawmakers Clear Online Gambling

Delaware's legislature passed a law that could make the state the first to open its population to a full range of legal online gambling, including Internet blackjack, poker and slot games.

The bill is expected to be signed by the state's governor and comes in the wake of a Justice Department legal interpretation last year that allowed states to authorize Internet gambling within their borders. Delaware's move marks a significant step in the long-running debate between the U.S. government, states and gambling companies over whether and how online gambling will become legal in the U.S. It is also likely to help spur legislatures and lotteries in other states to legalize or implement Internet gambling, a long-predicted change that is taking more time to materialize than some observers expected.

Twitter prepares curbs on hate speech

Twitter is preparing to introduce new measures to reduce the visibility of “hate speech” or “trolling” on the site. But management faces a struggle to balance some Twitter users’ desire for anonymity and free speech – such as contributed to the Arab Spring protests – with the wish of others to be protected against abuse.

Dick Costolo, Twitter’s chief executive, became visibly emotional as he described his frustration in tackling the problem of “horrifying” abuse while maintaining the company’s mantra that “tweets must flow.” One technical approach Twitter is considering would hide from users’ page of replies any tweets directed at them by individuals who are not seen as “authoritative”, because they have no followers, no biographical information and no profile picture. But the company’s management is also painfully aware that this could diminish open exchange on the site and undermine Twitter’s long-held commitment to free speech.

NBC's $1 Billion Olympics Sellout

With exactly one month to go before the Opening Ceremonies of the London 2012 Summer Olympic Games, NBC is on track to book nearly $1 billion in ad sales revenue for the 17-day event.

Seth Winter, NBC Sports Group evp of sales and sales marketing, said that NBC was, for all intents and purposes, sold out of its available inventory, although he noted that the network always holds back some contingency time. Meanwhile, talks with sponsors of the 2014 Winter Games in Sochi, Russia, and the 2016 Olympics in Rio de Janeiro, Brazil, are in “early innings.” NBC has lined up dozens of new sponsors for the London Games, a roster of clients that includes Chobani Greek yogurt (an official sponsor of the U.S. Olympic Team) and Fruit of the Loom.

Google vs everyone: an epic war on many fronts

Google is a company that is fighting a lot of battles on many fronts. In some places it is winning, but most places it is trench warfare. It is still the king of search and advertising. It is doing quite well when it comes to Android, though they never really talk about its real financial impact on Google’s business. I would argue that Google Apps and Google Chrome OS have a decent shot of carving out a meaningful role inside corporations, retailers, airlines and campuses. Google Maps is a market leader and well, there is nothing like YouTube – though the monetary impact of the video colossus is still kept under a fog by Google. However, this is where the list of sure things end. Simply take a look at this list of what I believe are important battles Google is fighting, and you begin to understand the challenges that Google faces.

Google Tries Something Retro: Made in the U.S.A.

Etched into the base of Google’s new wireless home media player that was introduced on June 27 is its most intriguing feature. On the underside of the Nexus Q is a simple inscription: “Designed and Manufactured in the U.S.A.”

The Google executives and engineers who decided to build the player here are engaged in an experiment in American manufacturing. “We’ve been absent for so long, we decided, ‘Why don’t we try it and see what happens?’ ” said Andy Rubin, the Google executive who leads the company’s Android mobile business. Google is not saying a lot about its domestic manufacturing, declining even to disclose publicly where the factory is in Silicon Valley. It also is not saying much about the source of many of its parts in the United States. And Mr. Rubin said the company was not engaged in a crusade. Still, the project will be closely watched by other electronics companies.

Memo to T-Mobile’s future CEO: Don’t change a thing

Philipp Humm is out at T-Mobile, and we don’t know why.

Maybe he really was planning to leave all along, as he claimed in an internal memo. Maybe he’s being forced out by parent company Deutsche Telekom for the failure of the AT&T-Mobile merger. Or maybe he was brought on board in 2010 for the sole reason of selling the U.S. subsidiary, and now that a sale is longer feasible, he’s moving on to the next project. Whatever the reason, the move is sudden, and T-Mobile finds itself looking for a new chief executive. We have some unsolicited advice for whoever that replacement will be as well as acting CEO Jim Ailing: Don’t mess with Humm’s work. T-Mobile may be suffering at the hands of its much larger rivals Verizon Wireless and AT&T, but the last thing T-Mobile needs right now is the strategy ‘shake up’ a new CEO invariably brings. After the failed merger with AT&T, Humm and his team put together a solid plan to become a competitive force in the market.

Political fundraising via text faces hurdles

The creators of a newly approved political donation-by-text message platform find themselves at a boom-or-bust juncture. In their perfect world, the Republican and Democratic national conventions will be political telethons of sorts. Party leaders might urge viewers to grab their iPhones or Androids and instantaneously text $10 to “OBAMA” or “ROMNEY” — a potential windfall for all. But at the moment, the companies who want to run the donations by text message system — Red Blue T, ArmourMedia and m-Qube — are in drawn-out talks with major mobile phone carriers such as AT&T, Sprint and Verizon to figure out how it will all work and how much of a cut everyone will take.

One wireless company executive familiar with the talks said that “there are a huge number of hurdles” to overcome, including cost, contractual obligations and federal reporting requirements. “I don’t see this happening this election cycle, and I’d be floored if it does,” the executive said, regardless of the Federal Election Commission’s unanimous blessing this month for the system to move forward.

Benton

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