James Murdoch: The son king

How will he approach his role as head of News Corp's business in Europe and Asia? Ian Burrell reports on how the former BSkyB CEO will not shirk from the battles ahead

By the time James Murdoch celebrates his 35th birthday on Thursday, he will have his feet under the table at his new office in News International, working on a strategy that is likely to transform the British media landscape for years to come.

His gaze will extend well beyond the Wapping Highway and his decisions will have such far-reaching effects that no competitor, be they in broadcasting, print, new media, telecoms, mobile, or any combination thereof, can afford to ignore them.

Put simply, Rupert's chosen son, starts his first working week today in his new role as the most powerful figure in this country's news media. So it is worth considering his past record to assess his likely impact.

First of all, we know that he is not afraid of a fight. For all his reluctance to do interviews, his apparent wish to be seen as "reclusive", his early-evening departures from social functions and his understated style of dark, tailored suit and plain white shirt, James Murdoch does not covet a quiet life nestling on the inherited laurels of more than $100million-worth (49million) of News Corporation shares.

No, he has already demonstrated that he has his father's Conquistadorean instincts to seek out, explore and capitalise on new territories, and the old man's tactical nous for outmanoeuvring both commercial opponents and regulatory obstacles in established markets. And he does this with an urbane charm not always associated with the "Dirty Digger".

During three years at the helm of BSkyB, and in spite of all the claims of nepotism when his appointment was announced, James has delivered real results.

The company's stock has risen by 15.7 per cent under his leadership, annual sales have climbed by 24.3 per cent to 3.7billion and profits have more than doubled to 499million 1.3billion has been returned to shareholders in the past two years.

Having taken charge of a relatively one-dimensional business in pay TV, he has repositioned it as a triple-play, multi-platform player, offering a package of satellite TV, home telephony and broadband. He has pledged that BSkyB will increase its subscribers to 10 million by 2010 and the company, with 8.7 million subscriptions, remains on course to meet that.

When rivals have threatened his position he has responded with the speed and force that one might expect from a black belt in karate. Sir Richard Branson was left shocked and bruised by the young Murdoch's audacious seizure of 17.9 per cent of ITV shares earlier this year, a move which, though it remains under investigation by the Competition Commission, wrecked Virgin's plans for taking control of Britain's biggest commercial broadcaster. That raid was instantly attributed to Rupert, until BSkyB sources went out of their way to stress that the plot had been hatched by James and his finance chief Jeremy Darroch during a flight to Barcelona.

Though he generally avoids the public gaze, he will step forward when there is the opportunity to land a blow. Invited to speak by the broadcasting regulator Ofcom last year, he took the chance to say that the watchdog's attitude was "more at home in Rangoon than in modern Europe", saying it was "authoritarian" and engaged in a "moral and educative crusade". He also denounced Lord Reith, the revered founder of public service broadcasting, as someone with "a pretty firm view of the need to keep the lower classes in their place".

When it was suggested to James that his battles with Virgin, the telecoms sector and the regulators meant fighting on too many fronts, he dismissed the clashes as "isolated skirmishes".

He has been alert to opportunities to present the big beast of BSkyB as the outsider, fighting for the viewer against the self-interest of the broadcasting establishment. He told Management Today earlier this year that the media elite in Soho regarded Sky's outer London headquarters as "a bunch of mud huts out in Osterley". Like Sir Alex Ferguson, James recognises the value of presenting his successful operation as being hard done by and encouraging what he describes as a "challenger culture" among his staff.

When it was announced last week that James would be standing down from his chief executive's role at BSkyB, shares fell by more than 16p (2.7 per cent) during morning trading. Nevertheless he remains involved, taking his father's former position as non-executive chairman, while his ally Darroch steps up to become chief executive.

In his new job, James Murdoch will have responsibility for other large pay TV operations such as Sky Italia and for the Asian satellite empire Star TV. He has already demonstrated to his father his acumen for running the latter, during a spell working in Hong Kong. When he presents his business card he still does so holding it between thumbs and forefingers and making a bow.

But in Britain, observers will be most interested in what plans he has for reinvigorating the national press, of which he will oversee 42 per cent through his control of The Times, The Sunday Times, The Sun and the News of the World.

Some believe that he has little feel for print media. They point to James's earliest experience of newspaper journalism as a schoolboy intern on his father's Sydney Mirror, when a photograph of him asleep during the morning news conference was published in the rival Sydney Morning Herald. Yet James's role will not be to get scoops but to position the business for the digital era, a process which is already well under way at Wapping, notably on The Sun, which already markets itself as a multi-platform proposition.

Much as he sees the value in taking the position of the underdog, James Murdoch is not slow to use the muscle at his disposal. Witness the speed with which he found 940million for that swoop on ITV.

Already there is speculation building that News International could go on to the front foot, using the twin tactics of price-cutting and smart journalistic investment to strike at less well-nourished opponents, such as Trinity Mirror. James Murdoch will be rolling up his tailored sleeves for fresh challenges. This time they could be bloodier than those "isolated skirmishes".

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