The man who masterminded the success of the Fox movie studio spectacularly quit yesterday, a day after its film Slumdog Millionaire swept the board at the Oscars.
Peter Chernin resigned as chief operating officer of News Corporation, Fox’s parent company, after failing to agree a new contract with his boss, Rupert Murdoch. He had been Mr Murdoch’s man in Hollywood for more than a decade, extending the media mogul’s tentacles far beyond his traditional newspaper business and establishing Fox as a powerhouse in filmmaking and broadcasting in the United States.
Under Mr Chernin, Fox has revitalised its presence in Hollywood, not just bolstering the Twentieth Century Fox business but carving a lucrative niche sponsoring independent films through Fox Searchlight. Offbeat comedies such as Juno and Little Miss Sunshine were box office bankers and went on to become Oscar contenders, while the studio was yesterday basking in the Oscars glow of both Slumdog Millionaire and The Wrestler, for which Mickey Rourke was nominated as best actor.
Then, last night, it emerged that Mr Murdoch himself, now 77, will take direct control of the film studio, as least in the short term. Mr Chernin will leave the company at the end of his five-year contract in July, sparking rumours of a split with Mr Murdoch over the growing role of the mogul’s son, James. For the moment, James Murdoch will stay in his post as head of News Corp’s Asian and European operations – which include the British newspapers The Sun and The Times – but it is believed that he is being groomed for the post of chief executive, and, ultimately, to succeed his father as chairman.
Hollywood insiders were already predicting a period of disruption at Fox. Mr Chernin had become one of the most powerful men in the industry, taking a key role in debates over its future in an era of internet piracy, and leading some of the tense, recent talks with writers’ and actors’ unions. James Murdoch, a former head of BSkyB in the UK, has no Hollywood experience. “Certainly losing a leader with Mr Chernin’s abilities and reputation is yet another challenge for the company,” said Michael Morris, an analyst at the investment bank UBS. “He is viewed as the operator, the guy who gets things done.”
Hollywood had been buzzing about Mr Chernin’s future as the end of his existing contract has neared, and as Mr Murdoch had apparently turned cooler on the prospects for keeping him by his side. Last year, the mogul had hoped to keep Mr Chernin at least for another two years, and had characterised negotiations as “constructive and friendly”. More recently, he said only that they were “private”.
In a statement, Mr Murdoch said: “Peter’s contributions to the company over the past two decades have been immeasurable. We are fortunate to have such a strong and seasoned group of leaders at our Fox companies and we are confident that our success will continue. There are few executives, at any company, that combine his maturity, his experience, and his skills as a communicator and leader – I will miss him.”
Commenting on his departure, Mr. Chernin said: “Next week marks my 20th anniversary with News Corporation and the company has been a huge part of my life. During my years here I have had the great privilege to work for one of the true visionary leaders of our time, Rupert Murdoch. As a partner and friend he has been inspiring, fascinating, and most of all, tremendous fun.”