Return of The Empire

Almost three years since “the most humble day” of Rupert Murdoch’s (left) life , the News Corp chairman may feel he can return to his old swaggering self.

The media mogul has yet to comment publicly on the acquittal of Rebekah Brooks, the most senior former executive in his media empire to be placed on trial for phone-hacking. 

Yet the market value of his media empire attests to how easily his business has shrugged off what once looked like an existential crisis.

The scandal that erupted in July 2011 forced the group to split into two companies – News Corp and 21st Century Fox – but their combined market capitalization of $85bn is up from $48bn on the eve of the crisis.

Fox has benefited from the resilience of television revenues. Investors welcomed the publishing spin-off, and analysts have pointed to signs of stabilization at News Corp’s newspapers in the UK and Australia.

Nonetheless, the hacking scandal has left a sizable imprint on how Mr Murdoch’s empire is run, and will continue to influence its future direction.

News Corp was long known for its appetite for large acquisitions such as Dow Jones and MySpace that sometimes proved more trouble than they were worth or expected.

The company “frequently overpaid or operationally misfired in efforts to translate successes in one market to another without adequate thought or preparation”, wrote Jonathan Knee and Bruce Greenwald in their 2011 book “The Curse of the Mogul”.

Until the hacking scandal intervened, that acquisitiveness was set to extend to the purchase of whole of UK satellite operator BSkyB. But whether the failure to buy BSkyB represented a missed opportunity is debatable.

“It is not clear what difference it would have made,” said Claudio Aspesi, an analyst at Bernstein. Fox is now discussing a possible sale of its stakes in Sky Deutschland and Sky Italia to BSkyB.

Since 2011 News Corp and 21st Century Fox have returned billions of dollars to investors, reversing Mr Murdoch’s past reluctance to buy back shares.