Everybody knows Rupert Murdoch loves his newspapers. He launched The Sun on Sunday last weekend to replace the News of the World and couldn't contain his excitement, constantly tweeting news about advertising and circulation performance. As has often been said, Mr Murdoch has ink running through his veins.
So, at first glance, the idea that the News Corporation chairman and chief executive, who turns 81 later this month, might sell his papers, including The Sun and The Times, seems almost impossible to believe. But increasingly the talk in the City and on Wall Street is that Mr Murdoch might have to consider the unthinkable.
Chase Carey, Rupert's number two and chief operating officer at News Corp, has fuelled the speculation this week by publicly admitting that the company had considered a sale or spin-off of the titles. Mr Carey told US investors "there certainly is an awareness" that the company would be worth more if it did not own the papers.
Wednesday's resignation of Rupert's son, James, as chairman of the UK newspaper group, News International, in the wake of the phone-hacking scandal has added further grist tothe rumour mill. Some observers claimed that meant the family was loosening its ties with the UKnewspapers.
Publishing contributes only around 15 per cent of profits at News Corp, which also owns The Wall Street Journal, the New York Post and a string of papers in Australia. Cable and pay TV and movies, including interests in Fox and BSkyB, generate the vast majority of income, prompting some investors to call for the papers to be sold.
Claire Enders, the founder of Enders Analysis, cautioned that Mr Carey's comments were expected as he needs to keep shareholders onside. "He needs to be seen to be engaging in a dialogue in an open way," she said. Ms Enders believes News Corp remains committed to the papers, pointing out it has invested some $50m (£31m) in The Sun's Sunday edition. "I really don't think the idea that Rupert Murdoch launches The Sun on Sunday and by Thursday there's a long-term plan to get rid of the newspapers makes any cognitive sense," she said.
What's more, Mr Murdoch is not under financial pressure from shareholders to sell. News Corp shares have recovered all their losses since the hacking scandal exploded in July.
James Murdoch's exit from NI hardly means his family has cut all links, either. Rupert Murdoch still sits on the board of NI. His eldest daughter, Prudence, joined the editorial board of The Times a year ago.
But Lorna Tilbian, a media analyst at the broker Numis Securities, said it is important to look at the bigger picture, and the TV business is key. Rupert Murdoch and Chase Carey still desperately want to buy the 61 per cent of the pay-TV giant BSkyB that it does not already own. Sky, which Mr Murdoch helped to launch in 1989, is hugely profitable, and is forecast to reap even bigger profits in the next few years – in contrast to the newspapers.
It should not be forgotten that it was the Murdochs' £8bn bid for Sky in June 2010 that encouraged rival news organisations to step up the pressure over phone hacking. The takeover was just weeks away from getting the green light from regulators when claims were reported in July 2011 that the News of the World had hacked the murdered schoolgirl Milly Dowler's mobile. That forced News Corp to drop the bid, but it remains high on the agenda.
A year ago, News Corp proposed hiving off Sky News as a separate company from BSkyB to win over regulators' concerns about plurality in news. Now Ms Tilbian thinks selling the papers makes more sense: "Because Sky News fits in with a global TV content business, with Fox and so on, this time I'd think they try to hive off or sell the newspapers because they're the ones that are causing the grief."
Some think it would be difficult for News Corp to find a buyer for the UK papers, particularly The Sun, when so many legal clouds hang over the paper. Another Sun journalist was arrested yesterday – the 11th in the police investigation. However, if the legacy of legal problems can be ringfenced, there ought to be no shortage of interest. One option is that Mr Murdoch himself hives off the papers into a family trust or collaborates with a wealthy partner.
If the papers were sold outright, sovereign wealth funds from Abu Dhabi or Singapore might be interested. Closer to home, Richard Desmond, owner of the Daily Express and Daily Star, has been keen. Germany's Axel Springer, owner of the popular tabloid Bild, has been mooted but has always maintained it has no interest.
Ms Tilbian says newspapers remain highly valued as trophy assets. "Horses are for gamblers," she says. "Newspapers are for the more intellectual."
Just don't expect Mr Murdoch to sell in a hurry.
Can James Murdoch stay at Sky?
How much longer will James Murdoch last as chairman of BSkyB? He survived Sky's annual meeting in November as the board unanimously backed him but 45 per cent of independent shareholders either voted against or abstained because of the News International hacking scandal.
Tom Powdrill, the spokesman for the shareholder watchdog Pirc, says some Sky investors are seriously concerned about the impact of hacking if the media regulator, Ofcom, conducts a "fit and proper" test into News Corp's 39 per cent shareholding and forces it to reduce its stake. "There have certainly been discussion among institutional shareholders about a negative ruling from Ofcom," he said.
News Corp is still desperate to buy all of Sky, so it does not make sense for James, a damaged figure, to stay as chairman. Given his decision to quit as NI chairman and as a director of GlaxoSmithKline, his exit from Sky looks all but inevitable.