DJ purchase would help Fox biz channel

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NEW YORK -- While News Corp.'s uninvited cash offer to buy Dow Jones & Co. might satisfy Rupert Murdoch's long-standing desire to own the Wall Street Journal, the acquisition would immeasurably boost the future success of the Fox Business Channel.

The channel will launch this year in about 30 million homes through carriage deals with big MSOs, with lots of work going on behind the scenes to hire on-air talent and prepare studios and a newsroom in News Corp.'s headquarters in New York. But while Fox News Channel CEO Roger Ailes could bring his considerable talents to bear on the production and distribution of the business channel, his main rival -- CNBC -- still held at least one significant card: the long-term deal with Dow Jones & Co. that gives CNBC access to the financial news giant's considerable data stream and on-air talents of journalists.

But that could change if News Corp. successfully buys Dow Jones with its $5 billion cash offer. It isn't clear how News Corp. could or would change the contract, which was signed in 1997 and runs through the end of 2012. An NBC Uni executive said Tuesday that the CNBC-Dow Jones deal isn't affected by a change in ownership at Dow Jones.

"It's a bold and brilliant move. ... They'll get the most important asset in financial journalism, they'll launch the Fox Business Channel with a real bang and they'll deny their competitor, CNBC, of talent," said Michael Robinson, senior vp Levick Strategic Communications in Washington.

CNBC declined comment Tuesday, but the channel, which broke the news of the bid earlier in the day, spent much of its airtime discussing Murdoch's move and didn't shy away from analyzing its impact on Dow Jones, News Corp. and CNBC itself.

"This is an enormous threat to CNBC," Robinson said. "I see in this the hand of Roger Ailes. Rupert Murdoch didn't do this without Ailes. Roger Ailes is known for one thing: winning. He doesn't lose. And this has all of Roger's earmarks on this."

Ailes presided over the business channel until he left NBC in the mid-1990s to found the Fox News Channel. Ailes has taken down one news leader, CNN, and CNBC is in his sights next.

"Buying Dow Jones gives them instant credibility and puts them in business," Benchmark Co. analyst Edward Atorino said.

While Dow Jones' partnership with CNBC still might cover several more years, financial analysts suggested there might be ways out of it for News Corp.

"Dow Jones does have an agreement with CNBC, but it only takes money to extract themselves from it," Prudential Equity Group analyst Steven Barlow said.

"I don't think that's a big deal," Atorino said. "Murdoch can find a few lawyers to figure that out."

In an appearance Tuesday on Fox News Channel's "Your World With Neil Cavuto," Murdoch said that News Corp.'s purchase of Dow Jones would help the business channel.

"We want to have a business channel that lives up to the quality and traditions of the Wall Street Journal," Murdoch said.
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