IntroductionThe News Corporation is a globally diversified media company. The principal operations of the company occur in the Australia, Britain, the US, Continental Europe, the Pacific Basin and Asia. TNC’s operations are carried out through eight segments in the industry, which include Filmed Entertainment, Cable Network Programming, Magazines and Inserts. Other industry segments are Direct Broadcast Satellite Television, Newspapers and Information Services, Book Publishing and Other. NewsCorp owes its origin to the establishment of a local newspaper called The News in 1923, in Australia by the father of Rupert Murdoch (Johnson et al, 2008).
By the 80s decade, the company had diversified into various industry segments through mergers, acquisitions and joint ventures on the world media market. Hence there is need to evaluate the business strategies and shifting corporate logics underpinning NewsCorp development. In the wake of the 21st century, TNC is counted among the world’s most international and largest media companies, a progress often attributed to Rupert Murdoch. TNC’s development is a case of success resulting from constant attention to changes in business contexts as a fundamental key.
The contextual settings in which the company operated positively influenced the diversification of NewsCorp (Chan-Olmsted, 2005). Thus prior to examining the strategy and presenting recommendations, there is need first to give the overview of the company especially with regard to the recent global economic crisis. NewsCorp OverviewIn the wake of the 2008 financial meltdown, the NewsCorp media conglomerate managed by Murdoch had only just one of its businesses performing well. This was in the cable networks segment, and specifically Fox News. The Corporation, which owns also Fox broadcast television network, 20th Century Fox film studio, MySpace and newspapers like The New York Post and The Wall Street Journal, reported a plunged operation income of more than 30%.
Hence last year is recognized as among the toughest the company has faced in its operational history. However Murdoch thinks that the worst encountered by NewsCorp may have passed and it is now behind the company. The News Corporation, like its peers, has opted to cut costs in efforts to weather the current recession. For instance, at MySpace alone, TNC has cut hundreds of jobs. Nevertheless it should be noted that cost cutting is not a permanent measure, and can only last for so long.
The rapid changes being experienced in the media business implies that no company can cost cut its path to global competitiveness. News Corporation’s performance underscored the occurrences across big media conglomerates (Ghemawat, 2007). Cable television, for which clients still subscribe a monthly fee, is the sole world corner maintaining robust operations. At the opposite end of the media spectrum is the newspaper business, where customers are now accustomed to reading their news online for free.
The newspaper division of TNC has had its operating income decrease by more than USD 300 million, in the full fiscal year ended. These events have prompted Murdoch to disclose that plans are underway for NewsCorp to charge all its news Web sites. Among the few print publications that have successfully gotten its audience to pay subscription fee for online news is the Journal.