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Rupert Murdoch's Internet Ambitions
by
Mark Evans
on Sun 21 Aug 2005 08:53 AM EDT | Permanent Link
All the news about Rupert Murdoch's plans to establish a strong Internet presence (a.ka. Murdoch.com) reminds me of December 1995 when Microsoft beckoned the media to Seattle for an Internet Strategy Day. At the time, Microsoft had realized the Web wasn't going to be a flash in the pan what with Netscape's success and all. Chastened but not embarassed, Bill Gates unleashed Microsoft's ambitious plans to get into the game. A decade later, Murdoch seems to be adopting the same approach: he's clearly late to the party but believes there is still time to have fun. The $580-million purchase of Myspace.com was the first major move in News Corp.'s New New Web strategy but what's next? News Corp., which owns satellite-TV services, newspapers, book publishers, a television network and movie studios, has talked about setting up a portal that could compete against Yahoo and MSN. There has also been rumors about the purchase of a search engine (Blinkx, Looksmart, Technorati). Murdoch's renewed interest in the Web shows how the major media companies are adopting aggressive strategies for the online distribution of content and services. The key question is whether News Corp. can use its financial muscle to establish a vibrant foothold. What, for example, would a News Corp. portal look like if the key elements were Blinkx for search; Myspace and Skype for millions of visitors/users a month; IGN Entertainment (the operator of Web sites such as AskMen, and Rotten Tomatoes, which is rumored to be on News Corp.'s shopping list); Fox TV, 20th Century Fox, HarperCollins and the Daily Telegraph for content. As a whole, you'd have all the necessary ingredients, in theory, to create a deep and multi-featured portal but is it enough to create a viable foothold in the portal market? There have been suggestions Murdoch will adopt a Barry Diller-like approach to the Web, which means there could be a lot of wheeling and dealing so News Corp. can get what it needs to become a serious Web player. A few years ago, this strategy may have easy to pull off but many of the best properties are already part of someone else's portfolio or too expensive - even for News Corp. This means Murdoch has to take a pragmatic approach and develop a strategy that leverage News Corp.'s extensive content assets with online properties that attract lots of users and, more important, advertisers. While it would be misguided to under-estimate Murdoch, his online track record has been, at best, spotty (i.e. the decision in the mid-1990s not to buy a stake in AOL after being told by Gates AOL would disappear). If Murdoch does indeed take a pro-active approach to the Internet, the happiest people out there may be start-up entrepreneurs and investment bankers.
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