November 2009


Rising son

By Malcolm Knox
James Murdoch speaking at Verge. © Esther Dyson/Flickr
James Murdoch speaking at Verge. © Esther Dyson/Flickr
James Murdoch

On 28 August, James Murdoch delivered the James MacTaggart Memorial Lecture, a speech named in memory of the prolific Scottish writer-director-producer who died in 1974. The first MacTaggart lecture was a socialist polemic from the playwright John McGrath. In subsequent years, it became part of the Edinburgh International Television Festival, a “wee gabfest” where, founder Gus Macdonald said, program-makers “would be allowed to speak freely because their bosses wouldn’t be there”. The rebellion present at the lecture’s origin has since been quashed by the bosses themselves, who now dominate both the audience and the lectern … which brings us back to the fourth child of Rupert Murdoch.

The Absence of Trust

Murdoch’s choice of speech title was a simple pun. The object of his attack was to be the BBC Trust, the governing body that, he argued, has let the public broadcaster run out of control. James Murdoch likes wordplay and literary references. At his Connecticut wedding in 2000, he read Pablo Neruda to his bride, the former model Kathryn Hufschmid; she read James Joyce. Murdoch – like many who are gifted with looks and wealth – wishes to be taken seriously for his intellect. This desire is also part of the curse of being an heir: he must prove himself worthy of the positions handed him and distinguish himself from his father.

I think this is the first time that someone who has delivered the alternative MacTaggart has graduated – if that’s the right word – to the real thing.

‘Graduated’ may or may not be the right word for someone who has failed to do so from university. James, born in Wimbledon in 1972, studied film and history at Harvard. He gained a name not for his academic prowess but for his Harvard Lampoon comics and the hip-hop record label, Rawkus Records, he started with two friends. At one stage, he went to Rome and dreamt of becoming an archaeologist.

Having grown up in New York apartments where, as his elder brother Lachlan said, “every breakfast was about media” and every dinner was a formal affair with, say, the mayor of New York or a Pulitzer Prize winner, James knew that smarts were prized more than having degrees. Little surprise, then, that he dropped out of Harvard and that this was not seen as a blemish by the family; when James’ sister, Elisabeth, told her father she was planning an MBA at Stanford, he sold her instead on the Rupert MBA in life. She began working for him.

In his years as ‘the alternative Murdoch’, James worked his way through a succession of hair colours, piercings and facial hairstyles. He reportedly followed the Grateful Dead around for a while. He once said that, in terms of business, he was just “kicking around in pretty small stuff ”. He worked on internet projects when they were still called ‘new media’ and moved back home at 24 after being appointed by his father to head News Corp’s Festival (later Festival Mushroom) Records. So, perhaps Murdoch had the qualifications – nine years ago – to deliver the ‘alternative MacTaggart’, a contrarian speech that was meant to keep MacTaggart’s personal legacy alive.

But by 2000, he was no longer the alternative son: he was given a seat on the News Corp board that year, on his twenty-eighth birthday. Festival had struggled and would be sold. He had some experience of ‘pretty big stuff’ from a stint at News America Digital Publishing and now he was to head his father’s Star Asia operation, based in Hong Kong.

James toed a firm Murdoch line while at Star, loudly criticising Hong Kong’s pro-democracy movement, as well as his father’s business rival Richard Li: “I fail to understand how one can define a free-to-air English language rehash of circa 1980 MTV as a global, multimedia, broadband, interactive TV service,” James said of Li’s company PCCW. Li, whose company was competing with Star for access into China, hit back where it hurt, saying he would not react “until someone with a successful business track record makes comments”. James later said he regretted his broadside at Li, but his aggression must nonetheless have pleased his father – who, at the time, was playing his own part in East–West diplomacy through his third marriage.

Of course, I’m flattered to be asked, but I am also a little worried. Does this finally mark my invitation to join the British broadcasting establishment? While that thought does terrify me, I am comforted in the knowledge that after my remarks my membership will have been a brief one …

James appeared on stage, if not terrified, then at least nervous: he does not seek the limelight. In his 2008 book on the Murdochs, The Man Who Owns The News, Michael Wolff reported that James told his PR agent his aim was to be known as “the reclusive James Murdoch”. James appeared in Edinburgh in a grey suit, white shirt and olive tie. Though he has long favoured well-made conservative clothes, his demeanour has changed. His facial piercings are all grown over, now no more than pinprick-sized dimples. At the MacTaggart, his hair was close cropped and uncoloured and his soft, north-eastern American accent reflected – as with his siblings – the years of his schooling.

Despite this shift, a Murdoch in the UK must necessarily be a rebel. The British establishment is Rupert’s ancestral foe, so, at the lecture, James could perform the act he has come to master: playing the iconoclast in a safely Rupert kind of way.

When we gather as an industry, it’s natural for us to talk about the future. I’d like to do something different tonight: to turn our focus firmly to the present. Because the path we are already on is a dangerous one.

The production of corporate speeches is necessarily opaque. However, there is little chance that James, given his intellectual strivings, would have palmed this one off to staff; he may even have written the whole thing himself. After the opening nerves, his delivery had a composer’s self-assuredness. Had his father read it? A speech like this is heavily self-conscious. James knows the world will be listening; he can try to control what will be quoted. Such speeches, then, are spiced with moments of intent.

By recoiling from the future and addressing the “dangerous” present, James was embedding himself deeper in family tradition, becoming what News Corp courtiers dub “the real thing”. James’ opening for becoming the real successor was created when elder brother Lachlan fled New York for Bronte Beach in 2005.

What does Rupert, at 78, care about daydreams of a ‘digital future’? Particularly as, so far, this ‘future’ has not been kind to News Corp, which bought into internet provider Delphi too early, ventured down the wrong line in China and lost billions on interactive TV with Gemstar. Further, James and Lachlan (with James Packer) were famously burnt by an over-enthusiasm for the internet in the One.Tel saga. James also tried to persuade his father to buy an internet company called Pointcast for US$450 million; somebody else bought it for US$7 million.

Rupert’s visionary days may be over. This speech, in which James later scornfully dismissed as ‘science fiction’ a BBC document that attempted to anticipate media in 2028, is a loyal return not only to the present but also to the family’s past.

Why do I believe we need to change direction as a matter of urgency? It’s quite simple. Because we have analogue attitudes in a digital age.

The great thing about James Murdoch, as a media heir, is that he has opinions. In his published diaries, Alistair Campbell writes about a meeting between his boss, Tony Blair, and the Murdochs: “Lachlan seemed a bit shy of expressing his views, whereas James was anything but.”

The preliminaries done, James set about his work scourging the BBC and the British broadcast regulator Ofcom. It was a basic anti-regulation rant, clothed in James’ favoured jargon and peppered with dichotomy. What does “analogue attitudes in a digital age” mean? Not, perhaps, what James wants it to mean. The BBC, in its expansive marrying of online and broadcast worlds, has shown that it is nothing if not ahead of the pack. If anyone should be accused of having “analogue attitudes”, it is the internet-shy News Corp. But that’s by the bye for James, who can credibly style himself as the digital Murdoch and was here talking about whether or not consumers should have to pay for their online news. Notwithstanding its merits, his argument sounded rather analogous itself.

The boundaries of what we mean by media are themselves expanding. In Japan, you can now buy your granny a mobile phone called a raku raku – which means ‘easy easy’ – designed specifically for the elderly. It has a built-in pedometer to track how many steps she is taking each day. And you can set it so that it sends a daily email to your inbox, letting you know your granny is still up and about and getting the right amount of exercise. There might be an advertisement attached. Is that media? Or health-care provision? Or is it both?

Actually, raku has several meanings, none of which is ‘easy’. It usually relates to craft techniques, notably raku pottery. The closest to James’ attribution is ‘pleasant’, which is not to nitpick, but rather to illustrate that the purveyors of marketing can also be its victims. James’ intent was to show his familiarity with both convergent media and the Eastern world.

At Star Asia James was seen as a success, even though his attitudes were not so much analogue as pre-modern. His father introduced James to the Chinese hierarchy as a “personal full-time envoy” but, in a place where nepotism was seen as a bonus, he was understood to be there as the son. As Bruce Dover writes in his book, Rupert’s Adventures in China: How Murdoch Lost a Fortune and Found a Wife, the organisational chart of the Sun King, who had placed himself at the centre of concentric rings of power, was very appealing to the Chinese – as was the appointment of the prince to the head Asian position. “Murdoch’s dynastic tendencies of placing his children in key executive positions … were well accepted by a ruling elite for whom nepotism was a widely established practice.”

With his stepmother, Wendi Deng, James trawled China in the dotcom boom years, spending US$120–150 million on more than 20 new businesses. During this time, he was also a vigorous champion of Henry Yuen, the Shanghai-born, former CEO of Gemstar. While Star’s fortunes began to turn around – helped mainly by Indian advertising sales – the Chinese ventures progressively went bust. The dotcom assets, bought at boom-time prices, were off-loaded at a loss, while Gemstar turned into a multi-billion-dollar write-down.

The benefit of nepotism turns out to be twofold: it confers position and, more importantly, it reconfigures definitions of success. James’ three and a half years at Star have been effortlessly spun as proof of his acumen and the key to his assumption of ‘the real thing’ status.

This year is the one-hundred-and-fiftieth anniversary of Darwin’s The Origin of Species. It argued that the most dramatic evolutionary changes can occur through an entirely natural process. Darwin proved that evolution is unmanaged. These views were an enormous challenge to Victorian religious orthodoxy. They remain a provocation to many people today. The number who reject Darwin and cling to the concept of creationism is substantial. And it crops up in some surprising places. For example, right here in the broadcasting sector in the UK.

Perhaps James Murdoch has always been stung by the tag ‘college dropout’, first levelled by Tunku Varadarajan in the Wall Street Journal when James gave an obsequiously pro-China speech in 2000. The WSJ was a constant bee in the Murdoch bonnet – until they bought it. However, with his choice to make ‘creationism versus evolution’ his impressive guiding metaphor, James opened numerous cans of worms. What he meant to do was equate creationism with centralised-state planning. But, as he said, creationism  “crops up in some surprising places” – think Fox News, the Murdochs’ American cable news network. There is not enough space here to catalogue the pro-creationism pedigree of Murdoch media, nowhere near enough space. For James to smear creationism, then, shows at the very least a refreshing innocence of what goes on under the News Corp banner.

It is this innocence that most endeared him to Hufschmid when she met him in 1997. She told Wendy Goldman Rohm that James loves the romantic idea of a “seersucker suit … panama hat and Mint Julep” and that he often exclaims in wonder at sights from an aircraft. “If you think anyone was going to be jaded or cynical or worldly or whatever, then it would be him,” she said. “It was always something I was so impressed with when we first met.” They have two children, Anneka, born in 2003, and Walter, born in 2006.

And now, in the all-media marketplace, [creationism] threatens significant damage to important spheres of human enterprise and endeavour: the provision of independent news, investment in professional journalism, and the innovation and growth of the creative industries.

But, of course, James was only using creationism as a metaphor for state control of the media. The central thrust of his argument is the same argument Rupert has been peddling for years: regulation, bad; free market, good. It only seems urgent now because the BBC – like the ABC here – is doing so well in comparison to private media companies. The public broadcasters are on firmer financial footing, because they are not riding the roller-coaster of shifting or collapsing advertising revenues and, in the online world, they are under no pressure to charge for their services or chase ratings down the tabloid trail. The Murdochs believe – have always believed – that public broadcasters should only play a role in the case of market failure, to mop up those enterprises nobody else can make a buck out of. For public broadcasters to become successful, progressive, innovative competitors is for James, as much as for his father, a philosophical affront.

It was the same for James’ grandfather. Recently uncovered ABC archives from the 1930s provided a reminder of Keith Murdoch’s opposition to the ABC gathering its own news and broadcasting before the release of the evening newspapers. Keith Murdoch can be seen as a father of convergence: in 1937, when he opened his first radio station in Melbourne, he said that his “Melbourne Herald was one of the first newspapers in the world to develop the theory that newspaper work and broadcasting could be joined to the advantage of all concerned.” He added that radio should be run by private enterprise, not the ABC. Murdoch even lobbied Canberra – unsuccessfully, as it happened – to change the legislation governing the ABC to prevent it from conducting its own journalism. Much has been said about James revealing himself as his father’s son; add to this that he is his grandfather’s grandson, too.

Often, the unique position that the business of ideas enjoys in a free society is used as a justification for greater intrusion and control. On the contrary, its very specialness demands an unusual and vigorous … stillness.

‘Stillness’ has been James Murdoch’s smartest tactic in the contest, if a contest it is, for the Murdoch succession. Lachlan was officially anointed the successor in 1997 and moved to New York to work under his father’s wing. Wolff writes that “being too close to their father, and the people who want to be close to him, isn’t a propitious move. Quite the opposite: to be at a distance, at a far remove from the old man, makes [James] the Murdoch everybody who is also distant from the old man wants to get close to.”

Wolff suggests this was a lesson James and Elisabeth learnt through Lachlan’s ultimate disillusionment. In 2003, having turned Star’s US$100 million annual losses into $10 million profits (on revenues of $300 million), James was put in charge of BSkyB, News Corp’s London subscription broadcaster. As in Hong Kong, he was later seen to have made a good fist of it. Being away from Dad, while Lachlan flew too close and was burnt, helped James’ stature, because family status is always – literally – relative.

Within the next few months, the number of homes in the UK that enjoy some form of television that they freely choose to pay for will top 50%. This steady growth of choice-driven television has nothing to do with public policy. In fact, the authorities have consistently favoured so-called free-to-air broadcasting. Yet, as you might expect, people who are used to paying for films, books, internet access and other quality content do not see anything strange in paying for quality television, too. 

In December 2007 after four years as CEO of BSkyB, James was made non-executive chairman of that company and given overall responsibility for News Corp’s television, digital and newspaper interests in Europe, Asia and the Middle East: more or less everywhere outside the Anglophone world. The previous year, Rupert had given an interview to Charlie Rose (on the American Public Broadcasting Service, no less), saying that he had decided, on the matter of the succession, to give his children equal financial shares in the business and let them sort out the power politics after his demise. Nobody pretends it will be resolved by a breezy chat around the kitchen table.

The punchline, when it comes to James Murdoch’s MacTaggart speech, was payment. See how blithely he skipped through “people who are used to paying for films, books, internet access and other quality content …” That’s rather analogue thinking, isn’t it, when the fastest growing cultural industry in the world is the piracy of copyrighted films, books and quality content on the internet – and when the biggest problem for traditional newspaper publishers is that they have been giving away their quality content for free?

James has clearly been given the task of winding in the hooks. News Corp, along with every other newspaper empire, would love to start charging for online services. News Corp has started with the WSJ – a thin end of a very big wedge. Common sense, and even a feeling for fairness, suggests they have every right to do so, but there remains the obstacle of the public broadcasters, who will not charge and could therefore come to command the online news space. 

Yes, the free press is fairly near the knuckle on occasion – it is noisy, disrespectful, raucous and quite capable of affronting people. It is frequently the despair of judges and it gets up the noses of politicians on a regular basis. But it is driven by the daily demand and choices of millions of people. It has had the profits to enable it to be fearless and independent. Great journalism does not get enough credit in our society, but it holds the powerful to account and plays a vital part in a functioning democracy.

So why do we continue to assume that this approach is appropriate for broadcasting: especially as one communications medium is now barely distinguishable from another?

There is a word for this. It’s not one that the system likes to hear, but let’s be honest: the right word is authoritarianism and it has always been part of our system.

Like much of what emerges from Murdoch speeches, what James has said here is absolutely laudable … up to a point. It is reminiscent of his father’s Boyer lecture, given last year in Australia, which decried the dumbing down of the country and called for higher standards in education. You cheered and cheered, and then wondered: Does Rupert read the Daily Telegraph? Can he seriously be advocating both higher standards in education and some of what shows up in, say, the Adelaide Advertiser?

James’ MacTaggart lecture eventually descended – or rather ascended – into a fairly simple rant against state control of media, elements of which suggested he may have been suffering amnesia about his time in Asia. One of James’ great coups for Star was a reciprocity deal he struck with the Chinese government. On 19 October 2001, James announced a “historic deal”: the Chinese were allowing Star to broadcast its Chinese-language entertainment channel, Xing Kong Wei Shi, into the mainland (if only into the Pearl River Delta). One of its shows was a Chinese form of ‘court TV’, in which an attractive young female judge presided over cases about such things as whether a man should be allowed to keep his pet donkey in his apartment (he wasn’t). In exchange, China’s state-run CCTV 9 would be carried by Fox on the west coast of the US.

James didn’t have much of a problem with authoritarianism then, nor even when Chinese censors began to find Xing Kong’s entertainment so light as to be subversive. Star, as ever, toed the line. But James’ compliance had little effect: News Corp’s penetration into China remains minimal, blocked by a nationalistic communist hierarchy which, in Dover’s view, stalled Murdoch in order to ‘buy time’ for the local media to mature. Meanwhile, James returned to a culture he knows better – certainly, he seems more coherent now he knows who the authoritarian enemy is. Or, perhaps, being shafted by the Chinese was what the Murdochs needed to remind them where, ideologically, they stand.

There is a land-grab, pure and simple, going on – and in the interests of a free society, it should be sternly resisted. The land grab is spearheaded by the BBC. The scale and scope of its current activities and future ambitions is chilling. 

Chilling and cold are words some News Corp observers use to describe James. Michael Wolff has him as “Emphatic. Contrarian. No niceties … remote. Harsh, intense, judgmental, deeply involved with his own perfection.” James has thrown himself into martial arts, skeet shooting and heli-skiing – sports requiring a great degree of precision and self-control. But where there is coldness, there is also heat.

James Murdoch has the same close friends he went to school and university with, a sign of both constancy and distrust of outsiders. No doubt they see him as anything but cold. But he reportedly goes through shoelaces at an extraordinary rate: something inside him is pulling them so tight they break. What a telling, and somehow sympathetic, metaphor.

So, he’s a repressed, sometimes angry individual, full of fire and driven by the need to prove himself? So, he has – from the will to be decisive rather than craven – gone out and made some poor business decisions? As billionaires’ children go, he’s not doing too badly.

Sixty years ago, George Orwell published 1984. Its message is more relevant now than ever.

As Orwell foretold, to let the state enjoy a near monopoly of  information  is  to guarantee manipulation and  distortion. 

You sense that if Orwell were writing now, the face of Big Brother he describes would look a lot less like Joseph Stalin and a lot more like Rupert Murdoch. 1984 is about the authoritarian power of icons. James Murdoch knows a little about icons, which in Orwell’s time were the best means of instilling a sense of omniscience. For a while, James had posters of Mao Zedong in his New York office. Perhaps he liked the dictator’s look; perhaps he didn’t understand what they meant. In time, they were removed.

Back at the Harvard Lampoon, one of James’ comic characters was called Albrecht the Atypical Hun. Albrecht was a satire of Allied conceptions of Germans during World War I, epitomised by propaganda posters of Germans devouring babies. Albrecht was bookish, gentle, a lover of poetry. Every monster, James seemed to imply, has a human side. And sometimes, public imagery lies.

In the Murdoch clan, there has never been any shortage of declarations of filial love. James’ have taken many different forms over the years, but his latest is the sincerest form of flattery.

Malcolm Knox

Malcolm Knox is a former literary editor of The Sydney Morning Herald, and has won three Walkley awards for journalism. His books include Jamaica, The Life and Bluebird.

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