Murdoch: News Must Stay Independent, Just Not 'Free'

By: Georg Szalai/The Hollywood Reporter News Corp. chairman and CEO Rupert Murdoch on Tuesday called on the U.S. government to stay away from expanding regulation and subsidizing newspapers and media companies in an attempt to save them in the digital age.

The news industry must remain free and independent, which is a key reason the U.S. press can hold politicians and other powerful people and institutions accountable, he argued at "From Town Crier to Bloggers: How Will Journalism Survive the Internet Age?," a workshop organized by the Federal Trade Commission. And he argued that the future of journalism is "more promising than ever," and consumers will pay for quality content.

Let news organizations innovate to give their customers news when, where and how they want it, but don't try to prop up failing news businesses, Murdoch argued in his remarks, which were webcast.

"We should not blame technology for these failures," he argued. Like restaurants that offer meals no one wants to eat or carmakers that build cars no one buys, media firms that don't adjust to the digital age must go away, according to Murdoch. "The future of journalism belongs to the bold," he said.

That is why News Corp. is increasing its investment in journalism "at a difficult time in our economy," the media mogul told the Washington crowd. "We do this because we intend to be the news leader in each of our markets."

Murdoch on Tuesday also once again attacked news aggregators and argued that consumers will pay for online news.

"The old business model based on advertising-only is dead," and quality content must be paid for in the digital age, he told the FTC workshop. After all, not even in a rebounding economy will new online ad revenue equal or outpace declining print ad revenue, he said.

Despite many doubters, consumers are willing to pay for "something of good and useful value" online, Murdoch said.

He took a stab at Google and others aggregating news content online "without contributing a penny to its production." Plus, bloggers and others at times simply slightly rewrite News Corp. journalists' stories without attribution "under the tattered veil of 'fair use,'" he added.

Murdoch concluded: "These people are not investing in journalism. ... To be impolite, it's theft."

While some have argued that media and journalism need government help to survive in the digital age that has created new competitors and hurt advertising sales at many media companies, Murdoch has long rejected the need for bailouts, interventions or increased regulation.

"We meet at a time when many news enterprises are shutting down or scaling back," Murdoch concluded at the FTC outing. "No doubt you will hear some at this workshop tell you that journalism is in dire shape, and the triumph of digital is to blame."

He added: "My message to you is just the opposite. The future of journalism is more promising than ever -- limited only by editors and producers unwilling to fight for their readers and viewers, or government using its heavy hand either to over-regulate us or subsidize us."

Murdoch also mentioned that News Corp. has for two years worked on a project "that would use a portion of our broadcast spectrum to bring our TV offerings -- and maybe even our newspaper content -- to mobile devices."

-- Nielsen Business Media