On Friday, late in the day, News Corp. announced
that it had hired Jon Miller to run its Fox Interactive division. Miller was, several executive changes back, the head of AOL. He may be the most successful executive ever when it comes to dealing with Internet companies that will never be successful because they’ve been run by non-Internet companies—like Time Warner or News Corp. (Among AOL people, if you ask, the last time anything good happened there, and pretty much nothing good has happened there in near 10 years, was when Miller was running the place.)
Miller, since his time at AOL, has put together a venture fund, Velocity, which has a portfolio of choice investments (among them, Broadband Enterprises and OpenX). So, it makes little sense for him to go back and run an old-line media company’s dubious digital strategy.
News Corp.’s is as dubious as any. It’s piss poor. Aside from MySpace, which the company lucked into, it’s got nothin'. And MySpace, once the killer social networking app, is looking a lot like AOL—bad technology, lower-demo users, no business plan, and no coolness at all. News Corp. has run it into the ground. (Up until last month, when he announced his imminent departure, News Corp.’s COO, Peter Chernin, was trying to offload MySpace in some fashion, and lock in some gains—but no luck there.)
News Corp., for its part, has, with its acquisition of the Wall Street Journal,
effectively rebranded itself as a newspaper company—a kiss of death. Rupert Murdoch, although the world’s least savvy Internet guy, nevertheless knows the Internet is a good diversionary move. He’s got to be able to say: “Pay no attention to the Wall Street Journal
.” MySpace once provided that diversion. Now, MySpace itself needs a diversion.
Murdoch desperately needs somebody. Miller, with his promising venture portfolio, and his obvious desire not to get branded as the guy who runs dead Internet companies, doesn’t need Murdoch.
Hence, Murdoch’s promises to Miller must have been huge—the strategy expansive. That means a huge check for Miller himself, on top of giving him the ability for him to write huge checks to other people. Cash and latitude. I’ll bet it took nothing less for Murdoch to get Miller than a commitment for News Corp. to become the most aggressive acquirer in the digital market.
Facebook is beyond even News Corp.’s budget.
So the prize is Twitter. There may not be anything less than Twitter that can distract Wall Street from News Corp.’s stubborn and, at this point, unnatural newspaper fetish, and, as well, convince it, for one last hurrah, that Rupert isn’t…well, gone.
More of Newser founder Michael Wolff's articles and commentary can be found at VanityFair.com, where he writes a regular column. He can be emailed at email@example.com
This is an inside Internet baseball column, which you might not be interested in if I don’t begin with the punch line: Murdoch buys