Murdoch’s Last Laugh

Andrew Leckey, an inveterate reader of newspapers, recently grabbed a copy of The New York Times as he dashed from his office at Arizona State. As director of the university's Donald W. Reynolds National Center for Business Journalism, his mission is to improve the quality of financial reporting. So you'd think he'd recognize his publications on sight. But he soon discovered, when he opened the paper, that he didn't have his Times with him. "I had walked out with The Wall Street Journal," he says. Just a year ago, that would've been unthinkable: the austere Journal with small headlines and no photos; the Times with a variety of display type and color images. "The Journal has been pushed to look like The New York Times," Leckey says. "There's this willingness to focus on banner headlines, and even the use of color photos." And nearly gone from the 119-year-old Journal are the iconic dot portraits of newsmakers.

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That's not all that has changed since Rupert Murdoch took over a year ago. After his News Corp.'s $5 billion acquisition of the Journal's parent, Dow Jones, Murdoch has jettisoned longstanding traditions of the paper. Operating through his editor in chief, Robert Thomson—a worldly, unsentimental Aussie—Murdoch has transformed one of the world's most specialized publications into a more general, fuller account of the news beyond the business world, especially in politics and international affairs. By expanding the Journal's bull's-eye, Murdoch is fulfilling a pledge to compete head-to-head with The New York Times—for readers and for advertisers. It's an evolution that's been showcased by the Journal's coverage of the confluence of a historic presidential election and a national economic meltdown.

Murdoch's new regime has accelerated other changes, relaunching the Journal's Web site and implementing a possibly historic restructuring of Dow Jones's entire news-gathering operation, including its news wires and WSJ.com. At a time when other print media (including the Times) are cutting back—reducing staff, eliminating sections and warning there's more to come—Murdoch's commitment to growth and investment are a dramatic counterpoint. Whatever else one may think of the 77-year-old's splashy journalistic sensibilities—and there are plenty of traditionalists who don't love the new Journal—few in the media business aren't impressed that Murdoch is at least trying to revitalize and extend an old-media brand. "The New York Times has been regarded as the best newspaper in the world," says Dow Jones CEO Leslie Hinton, a veteran Murdoch executive. "That's a reputation we don't believe is deserved. We're now a real alternative."

So far, the results are mixed, susceptible to different interpretations and haven't immunized parent News Corp. from the pounding that all media stocks are absorbing this year. The Journal is drawing more readers and advertisers, including coveted luxury brands. Newsstand sales have soared by more than 20 percent since the economic crisis. Dow Jones is looking to add color capacity, according to a company publishing executive who isn't authorized to discuss the subject. WSJ.com now draws more than 20 million unique visitors per month, and enjoys the enviable distinction of a dual stream of revenues from subscribers and advertisers. But it's unclear whether the growing print and online audiences are directly linked to Murdoch's overhaul. Maybe it's just inherent reader interest in two galvanizing news stories. In any case, the Journal's popularity has yet to boost overall profitability at Dow Jones. In its latest fiscal quarter ended Sept. 30, News Corp. blamed Dow Jones for a $4 million reduction in pretax profits of its global newspaper and information segment.

Still, as a result of the Journal's industry-defying growth and News Corp.'s investments, Murdoch finds himself basking in changing sentiment. The Journal newsroom has embraced him as a savior. That was unimaginable in 2007 during the tumultuous eight months between Murdoch's initial offer and the final acquisition—a corporate drama that dominated the financial press. The takeover battle pitted the world's most powerful media mogul and the Bancroft family, a dysfunctional clan that controlled Dow Jones for more than a century.

Fearing the worst from the individual long regarded by the media establishment as a barbarian within its midst, some Journal reporters desperately, and fruitlessly, sought a white knight. But they now see "he's not burning, pillaging and firing" like the industry's other top publishers, including the Times, says a former top editor. "Everything Rupert said he wanted to do, he's trying to do." Nor is there any evidence he's interfered editorially based on any political predilections or business agendas, as many journalists feared when he approached the Bancrofts.

Even so, converts remain nervous. Murdoch may have assured the Journal's survival—but to what end? Journal veterans, for example, had feared all along the loss of the newspaper's distinctiveness, given Murdoch's goal to go beyond business coverage. Those worries will be buttressed by reactions like Leckey's. Those in the newsroom bemoan the slow disappearance of perhaps the newspaper's most revered contribution to journalism—the page-one "leder," the long explanatory pieces on either the left or right side of the pre-Murdoch Journal.