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James and Lachlan ready to take risks like Rupert Murdoch but not to bet the whole company
MUMBAI: The Murdoch scions James and Lachlan, who have completed a little over three months in their respective roles of 21st Century Fox CEO and executive co-chairman, believe in focusing on their jobs and taking the right decisions rather than refuting rumours of power struggle between them.
In their first joint interview to The Hollywood Reporter since the big announcement, the brothers talk about working as partners. “It’s a new way of working together. But as partners, so far, so good,” as James put it.
Questioning their risk tolerance, THR asked, “Your father was willing to bet the company several times by buying the studio or starting the Fox network. Do you share that same risk tolerance?”
To this, Lachlan replied, “We have to take risks, right? But that’s not to say [we’re] going to bet the whole company. Even after the [financial] crisis in ’90, ’91 [when News Corp nearly crumbled under massive debt], I think even our father says he’s not going to take that size of a risk [again].”
He added that the company now has a scale where they do not have to be in a position to bet the whole company, but they are going to take a series of carefully thought-out but aggressive, creative and strategic risks.
Over the next year or two, the brothers expect the company to move forward at a ‘pretty high velocity’. With the changing dynamics of the media industry, 21st Century Fox is also developing strategies to deal with these changes.
Among these strategies is to continue having a variety of models of advertising with TV moving further from an ad-supported model to a subscription-based one.
James explained to THR, “We’ll continue to have a variety of models, some dual models with advertising but the traditional conception of advertising as an interruptive format that is sort of scattershot, is something that needs to evolve. We’re already seeing that in a digital-streaming environment where we can create new ad products that are less interruptive, have lighter ad loads that create a better product experience for customers.”
He stated that the advertising business could be very strong, but the current interruptive model of advertising, of cueing things up and down the line, and interrupting the programming for 12, 15, 18 minutes, is something that probably would not be tolerable for customers.
“That’s not to say that I think everything is going to subscription. I think you’re still going to see a mixed model, but a lot needs to be done. Many executives need to show more leadership in pushing forward on ad innovation and particularly around premium, quality video advertising, which is still an incredibly impactful medium for marketers,” James told THR.
Speaking about the conglomerate’s other businesses like sports, Lachlan asserts that they are committed to growing it further and it would be the company’s main continued investment.
“That doesn’t mean that any price is the right price, and we have been very comfortable walking away from opportunities. I think with Fox Sports 1, we’re really happy with the packages we have. There’s baseball, NASCAR, UFC, golf. It’s a very strong line-up,” added James.
With both the brothers spearheading the company, there have been speculations of those two ‘bickering’ in board meetings.
However, the brothers disagree, stating that they never disagree. Clearing the air, James said, “From a strategy point of view, on the board-level stuff, I don’t think Lachlan and I have ever had any major or really any minor disagreements with respect to where the direction of the business needs to be and how we prosecute that.”
When news of the change in leadership broke, 21st Century Fox put out a statement saying Fox News chairman and CEO Roger Ailes would report to James and Lachlan. According to THR, Ailes had stated he did not know the two, and his relationship was more with Rupert. In fact, he even told THR earlier this year that nobody knew what was going to happen to him or to Fox News once Rupert retires.
Commenting on their relationship now, Lachlan mentioned, “We both talk to him all the time. The business he’s built and the channels he’s built are terrific. We have a huge regard for him, and he’s done a great job.”
James added, “We have a good relationship with Roger, and it’s been a long one. Fox News is an incredible franchise. We think they’re doing a great job. He just signed a new contract and we’re really pleased with that, and we hope he stays for as long as he wants.”