© Financial Times
James Murdoch is planning a sweeping shake-up of News Corporation’s Star Asian television operations, his biggest move yet to stamp his mark on the most promising growth area in his father’s media empire.
The move will involve a sharp cut in jobs in Hong Kong and the rest of the region, according to people familiar with the matter, as the group aims to cut costs and consolidate overlapping operations.
Star’s Indian operation, which generates the most profits for the group in Asia and reports to Hong Kong, will become independent and start reporting directly to James Murdoch, who is based in London, where he has been head of News Corp’s Asian and European operations since 2007. James Murdoch was posted to Asia from 2000 to 2003 as head of the Hong Kong-based Star group. People who worked with him there say that he helped turn round Star, which had been losing money since Rupert Murdoch, his father, acquired it in 1993 from Richard Li, the Hong Kong tycoon.
News Corp recently promoted Rebekah Wade, former editor of The Sun newspaper in London, to run News International, the company’s UK newspaper operations, freeing up time for James Murdoch to focus on other parts of his portfolio.
Under the Asian plans, News Corp aims to eliminate overlap between Star, which operates 60 channels in 13 languages and is distributed in 53 Asian countries, and Fox International Channels, which distributes the cable networks FX, National Geographic and other channels in the region. The plans, yet to be finalised, are part of News Corp’s global rethinking of its business at a time when media consumption has drifted online. It is aiming to control costs across its portfolio after reporting a 47 per cent decline in operating profit in the first three months of the year.
What the group is planning for its operations in China is left unanswered, however.
Executives have complained about the group’s China businesses, which have not yielded higher returns in spite of Rupert Murdoch’s personal attention.
News Corp’s Star India business accounts for $400m (£240m) in sales per year, more than 75 per cent of regional revenue. But amid growing competition, profit in June this year, Star’s regional profits are estimated to have fallen to $35m or less, compared with $76m in June 2008, according to the Media Partners Asia research group.