Business - Murdoch revitalizes the WSJ

Johnnie L Roberts

Andrew Leckey, an inveterate reader of newspapers, recently grabbed a copy of The New York Times as he dashed from his office at Arizona State. As director of the university's Donald W. Reynolds National Center for Business Journalism, his mission is to improve the quality of financial reporting. So you'd think he'd recognize his publications on sight. But he soon discovered, when he opened the paper, that he didn't have his Times with him. "I had walked out with The Wall Street Journal," he says. Just a year ago, that would've been unthinkable: the austere Journal with small headlines and no photos; the Times with a variety of display type and color images. "The Journal has been pushed to look like The New York Times," Leckey says. "There's this willingness to focus on banner headlines, and even the use of color photos." And nearly gone from the 119-year-old Journal are the iconic dot portraits of newsmakers.

That's not all that has changed since Rupert Murdoch took over a year ago. After his News Corp.'s $5 billion acquisition of the Journal's parent, Dow Jones, Murdoch has jettisoned longstanding traditions of the paper. Operating through his editor in chief, Robert Thomson—a worldly, unsentimental Aussie—Murdoch has transformed one of the world's most specialized publications into a more general, fuller account of the news beyond the business world, especially in politics and international affairs. By expanding the Journal's bull's-eye, Murdoch is fulfilling a pledge to compete head-to-head with The New York Times—for readers and for advertisers. It's an evolution that's been showcased by the Journal's coverage of the confluence of a historic presidential election and a national economic meltdown.

Murdoch's new regime has accelerated other changes, relaunching the Journal's Web site and implementing a possibly historic restructuring of Dow Jones's entire news-gathering operation, including its news wires and WSJ.com. At a time when other print media (including the Times) are cutting back—reducing staff, eliminating sections and warning there's more to come—Murdoch's commitment to growth and investment are a dramatic counterpoint. Whatever else one may think of the 77-year-old's splashy journalistic sensibilities—and there are plenty of traditionalists who don't love the new Journal—few in the media business aren't impressed that Murdoch is at least trying to revitalize and extend an old-media brand. "The New York Times has been regarded as the best newspaper in the world," says Dow Jones CEO Leslie Hinton, a veteran Murdoch executive. "That's a reputation we don't believe is deserved. We're now a real alternative."

So far, the results are mixed, susceptible to different interpretations and haven't immunized parent News Corp. from the pounding that all media stocks are absorbing this year. The Journal is drawing more readers and advertisers, including coveted luxury brands. Newsstand sales have soared by more than 20 percent since the economic crisis. Dow Jones is looking to add color capacity, according to a company publishing executive who isn't authorized to discuss the subject. WSJ.com now draws more than 20 million unique visitors per month, and enjoys the enviable distinction of a dual stream of revenues from subscribers and advertisers. But it's unclear whether the growing print and online audiences are directly linked to Murdoch's overhaul. Maybe it's just inherent reader interest in two galvanizing news stories. In any case, the Journal's popularity has yet to boost overall profitability at Dow Jones. In its latest fiscal quarter ended Sept. 30, News Corp. blamed Dow Jones for a $4 million reduction in pretax profits of its global newspaper and information segment.

Still, as a result of the Journal's industry-defying growth and News Corp.'s investments, Murdoch finds himself basking in changing sentiment. The Journal newsroom has embraced him as a savior. That was unimaginable in 2007 during the tumultuous eight months between Murdoch's initial offer and the final acquisition—a corporate drama that dominated the financial press. The takeover battle pitted the world's most powerful media mogul and the Bancroft family, a dysfunctional clan that controlled Dow Jones for more than a century.

Fearing the worst from the individual long regarded by the media establishment as a barbarian within its midst, some Journal reporters desperately, and fruitlessly, sought a white knight. But they now see "he's not burning, pillaging and firing" like the industry's other top publishers, including the Times, says a former top editor. "Everything Rupert said he wanted to do, he's trying to do." Nor is there any evidence he's interfered editorially based on any political predilections or business agendas, as many journalists feared when he approached the Bancrofts.

Even so, converts remain nervous. Murdoch may have assured the Journal's survival—but to what end? Journal veterans, for example, had feared all along the loss of the newspaper's distinctiveness, given Murdoch's goal to go beyond business coverage. Those worries will be buttressed by reactions like Leckey's. Those in the newsroom bemoan the slow disappearance of perhaps the newspaper's most revered contribution to journalism—the page-one "leder," the long explanatory pieces on either the left or right side of the pre-Murdoch Journal.

The Australian-born Thomson, 47, personifies the new Journal. He previously edited Murdoch's Times of London and the U.S. edition of the Financial Times. Thomson took over the Journal in May after the resignation of Marcus Brauchli, a Journal veteran whom Murdoch inherited with the transaction (and who is now editor of The Washington Post, whose parent company owns NEWSWEEK). Despite being a talented editor by all accounts, as well as an agent of change, Thomson remains an aloof presence to many in his anxious newsroom. The Murdoch regime "didn't come in with the view of winning approval," he says, "but one of clearly needing to change things."

Thomson's latest change, the appointment of a deputy editor, does little to assuage any unease. Bypassing Journal veterans and American journalists, he reached outside the publication last month to tap Gerard Baker, the Washington, D.C.-based U.S. editor of The Times of London. Officially, Baker, a Brit, will "spearhead" the Journal's "development as a national paper of influence and as an unrivaled international business-news franchise," Thomson said at the announcement. But the newsroom is buzzing about another of Thomson's alleged rationales. He supposedly told underlings that Baker will help infuse "fun" into the workplace, a capacity he apparently believes Journal editors lack. Baker, too, did Thomson a good turn during the Democratic convention in Denver in August. Thomson was stuck at a boring gathering of Journal staffers at a suburban pancake restaurant. Baker, at a party of top Obama operatives in downtown Denver, called his would-be boss and told him the operatives wanted to meet Thomson, who promptly fled the pancake affair. Thomson is unapologetic about his hires or his style. "I put pressure on people," he says. "That is my job—not to create a culture of complacency." But he hastens to add that there's been "a genuine enthusiasm and willingness to take a different direction into the future."

The personality drama aside, the evolving Journal—including its Web counterpart—is exhibit A of Murdoch's zeal for the viability of mass publications. In a recent lecture in Australia titled "The Future of Newspapers: Moving Beyond Dead Trees," he cited the transformed Journal in rebutting journalists who "seem to take a perverse pleasure in ruminating on their pending demise." He added, "The newspaper, or a very close electronic cousin, will always be around. It may not be thrown on your front doorstep the way it is today."

The Journal is larger than it was a year ago, having added four pages to accommodate expanded nonbusiness—primarily international—news. On top of that, there are two more pages of opinion and arts and cultural coverage. The Journal has relaunched its once renowned "Heard on the Street" column, and increased the staff of its Washington bureau. Average paid circulation totals slightly more than 2 million, with an additional 1 million electronic subscriptions. There's wide notice of the Journal's greater sense of urgency to break news, which has been essential during the economic crisis. Despite the concerns about the vanishing page-one feature stories, Murdoch hasn't abandoned lengthy investigative journalism.

Soft news has also become more prevalent. In a high-profile move, the Journal launched a glossy magazine, WSJ, in October. It hardly arrived smoothly. According to Journal insiders, a major feature on model Kate Moss and her business partner was pre-empted by a similar story in Vogue. Many subscribers—including the magazine's editor—never received the magazine in their weekend edition of the Journal. Many readers criticized WSJ as falling short of Journal standards. Thomson dismisses the objections. "The content is necessarily different [from] but not lesser than that of the main paper, and all of the copy went through the hands of senior Journal editors," he says. Madison Avenue embraced the magazine. The inaugural issue had more than 50 advertisers, including 19 who had never used the Journal.

Advertisers, of course, determine a publication's financial success. But they aren't a substitute for journalistic quality or distinctiveness. For generations, the Journal's stock in trade was business coverage, the characteristic Murdoch is now trying to submerge. In that audacious effort, admirably backed by capital and staffing, he runs the risk of making his creation indistinguishable from its rivals. The New York Times is one thing, but with flashy headlines, skinny models and color on the front page, does Murdoch really want Andrew Leckey mistaking the Journal for USA Today as he grabs a paper on the run?