Four years ago, the idea that James Murdoch would lead his family’s globe-straddling media group seemed unlikely.
In July 2011, James stood before the UK Parliament with his father, Rupert Murdoch, and swore he had no knowledge of phone hacking at the family’s News of the World tabloid in London, including the interception of messages on a murdered school girl’s phone.
James was 38 then, and had been considered a rising star in his father’s News Corp, which at the time also included the Fox film studios, cable channels and newspapers including The Wall Street Journal.
The phone-hacking scandal grew to include terror victims, celebrities and other public figures. It led to charges against journalists, the closure of News of the World, withdrawal of a takeover bid for Sky and James’ relocation to New York.
In a 2012 ruling, the British media regulator Ofcom questioned his competence, saying his failure to act was “difficult to comprehend and ill-judged”. Even his own sister Elisabeth was openly critical of James during the crisis, telling reporters that he should have taken a “step back”.
In the end, the British parliamentary committee cleared James of any wrongdoing.
Fast forward to last Thursday , when James emerged on top as the Murdoch group’s long-awaited succession blueprint was unfurled.
Under the plan, which comes two years after the group was split into an entertainment side and a publishing side, James is to become the chief executive at 21st Century Fox, the television and film side. He is also on the board of News Corp, the print side.
While the patriarch Rupert Murdoch, now 84, could always change his mind, for the time being James stands as the heir apparent. The company said on Tuesday that the change will take place on July 1.
At one time his brother Lachlan Murdoch, older by a year, had held that unofficial rank.
Relations among the Murdoch siblings are, as most might expect, complex. Besides James and Lachlan, Rupert Murdoch has four other children, all daughters, but either inclination or youth has ruled each of them out of the contest to be in charge.
The four grown siblings (the other two are adolescents) have one thing in common – they have all tried to move beyond the family orbit, but they have never quite escaped it.
James
James and Lachlan are children of Rupert’s second marriage, to the Scottish journalist Anna Torv.
In his youth, James was considered a rebel, with earrings, baggy pants and platinum-blond hair. Today he offers a clean-cut look with glasses and short hair, and is married to an American with whom he has three children.
After dropping out of Harvard in 1995, James created his own music label, Rawkus, which helped establish the hip-hop acts Mos Def and Talib Kweli. News Corp bought the label in 1998. This led to charges of nepotism in some quarters.
James managed News Corp’s musical division and later headed BSkyB, a satellite broadcaster in which the company had invested. His appointment at age 30 to head the broadcaster made him the youngest chief executive in the history of Britain’s FTSE 100 index of major stocks.
Investors have been particularly impressed with James’ role in spearheading Fox’s digital investments, including the purchase of a 5 per cent stake in Vice, the acquisition of True X – which helps broadcasters sell digital advertising – and an investment in Roku, the streaming video player.
Investors often say that James is more enthusiastic about courting shareholders while being less sentimental about assets than his father, whose empire was founded on newspapers and who was widely seen to have overpaid when he bought the Wall Street Journal publisher Dow Jones & Co for US$5 billion.
“One might expect him to be a little bit more adventurous in terms of acquisitions, especially on the international and digital fronts where he seems to be quite engaged,” said the S&P Capital IQ analyst Tuna Amobi.
Lachlan
Under the succession plan, Lachlan is to become the co-executive chairman of both News Corp and 21st Century Fox.
For many years he was the front-runner to take his father’s place.
Lachlan was still in his late 20s when he was appointed the executive director at News Corp in 1996 and the deputy chief operating officer in 2000.
He made a notoriously bad investment in the Australian telecommunications company One.Tel, which subsequently collapsed, losing hundreds of millions. But an investment in the Australian online real estate company REA Group in 2000, reportedly worth $11 million, ballooned. The value of News Corp’s stake is $3.1bn today.
In the summer of 2005, Lachlan abruptly left News Corp. He had reportedly clashed with his father. In one telling, executives went over Lachlan’s head “and, very foolishly, Rupert Murdoch didn’t back his son up”, said David McKnight, the author of Rupert Murdoch: An Investigation of Political Power. Lachlan returned to the fold in March last year when he was named the non-executive co-chairman of 21st Century Fox and News Corp – positions that suggested key roles in both businesses.
Lachlan has managed several units of the company, including the HarperCollins publishing group, Fox Television Stations and the New York Post.
He also runs a private investment company called Illyria (which is the name of the fantastical kingdom in Shakespeare’s Twelfth Night). Lachlan also heads Nova Entertainment, which invests in media and telecom operations in Australia.
A Princeton University graduate, he married the Australian actress and model Sarah O’Hare, with whom he has three children.
Elisabeth
She too is a product of Rupert’s second marriage.
Now 46, Elisabeth is an angel investor in media and technology start-ups. In 2001, she founded Shine Group, a TV production company that made such shows as The Biggest Loser and MasterChef. She sold Shine to News Corp for about $600m in 2011, triggering shareholder lawsuits that accused Rupert of nepotism.
She later said at a Guardian media event that she had “no ambition” for the top job.
Elisabeth’s independent voice and deep fortune have made her one of London’s top socialites and a media power in her own right. As some observers think about how Rupert’s sons will run the company, they notice that there is no role for Elisabeth, who had been brought into a prominent role when News Corp took a chequebook to Shine. But her role had already diminished when Shine was merged with Endemol last year and she stepped away from day-to-day operations.
Prudence
Prudence MacLeod is Rupert’s first child, born in 1958. She is the sole offspring of his marriage to Patricia Booker, who had worked as a flight attendant.
Ms MacLeod turns 59 this year and is married to Alasdair MacLeod, a former News Corp executive in Britain and Australia, but otherwise has little to do with the media companies. However, she shares with James, Lachlan and Elisabeth a single vote in the family trust that will own 38.4 per cent of voting shares in both News Corp and Fox upon Rupert’s death.
Ms MacLeod was reportedly named to a board that oversees News Corp’s UK newspapers, The Times and Sunday Times, in 2011.
Grace and Chloe
Grace, 13, and Chloe, 11, are the children of Rupert Murdoch and his third wife, Wendi Deng. The couple divorced in 2013. Ms Deng has reportedly clashed with Murdoch over her children’s inheritance, which amounts to nearly 11 million non-voting shares in the two media companies.
Grace and Chloe have an economic stake in Fox and News Corp but no voting shares.
In the end, while James is ascendant in the family business, his ability to work alongside his supplanted brother will be an early test of his ability to lead. The brothers are “yoked together in a sort of competitive collaboration”, said David Folkenflik, a reporter for the American radio service NPR who wrote a book called Murdoch’s World: The Last of the Old Media Empires.
A source familiar with the matter described the fraternal arrangement as a partnership, and a big remaining question is whether the family will prosper without the help of a strong outsider in the executive ranks. Chase Carey, the highly respected president and chief operating officer at 21st Century Fox, will move into an advisory role as part of the succession plan.
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