Fox Shake-Up: Is a Replacement Needed for Chase Carey?
Carey's new role and Peter Rice's focus on TV mean mean a missing executive layer — for now.
This story first appeared in the June 26 issue of The Hollywood Reporter magazine. To receive the magazine, click here to subscribe.
For nearly two decades, Rupert Murdoch has run his media empire with the help of a smart, polished, disciplined man in a suit whose last name was not Murdoch. Since 2009, that man has been Chase Carey — well regarded on Wall Street as having a steady hand on the wheel. But that structure is about to change. With 21st Century Fox revealing Tuesday that Carey will become executive vice chairman but only through June 30, 2016, it appears that James Murdoch, 42, intends to fill that job himself.
Wall Street has not shown jitters since it became public June 11 that Rupert would make James CEO of 21st Century Fox and his brother, Lachlan, 43, co-executive chairman. Analyst Tuna Amobi says he wouldn't expect the company to name anyone to a COO role right away, "before James has had a chance to settle down."
But long term, there are plenty of questions, says Amobi: "How long will Chase stay? What does it mean to have Lachlan as co-executive chairman? And Rupert himself — how long does he stay?" Analyst Harold Vogel thinks Wall Street won't be alarmed if no one is named to replace Carey. "Will they need an experienced guy for all the crummy details?" he asks. "They probably will down the road. But for now, this is a satisfactory outcome."
It is, however, different. Starting in 1996, Peter Chernin occupied a top management role, primarily running the film and television operations. When his departure was announced in February 2009, the official word was that there would be no immediate replacement and then, just weeks later, Carey was hired with expanded responsibilities. In addition to getting Chernin's titles of president and COO, Carey was named deputy chairman of the Murdoch empire.
In August 2011, as the phone-hacking scandal raged, Rupert Murdoch revealed that in the short term, at least, Carey was in line to succeed him. While expressing confidence in the damaged James, Rupert said, "Chase is my partner, and if anything happened to me I'm sure he'll get it immediately — if I went under a bus."
Many in Hollywood long have believed that the person in line for the seemingly essential Chernin- or Carey-type job was Peter Rice, who oversees the Fox TV business (network, studio, sports and all channels except Fox News). He is close to Rupert and a discreet and smooth executive. When he was moved unexpectedly from the film side to a top job on the TV side in 2009, the Los Angeles Times stated what then seemed obvious: "Rice is following a mirror image of Chernin's cross-training" in Murdoch's empire.
But now an insider suggests that the idea of even a Chernin-type job, focused largely on the West Coast operations, is dated. "As our business becomes more global, we don't look at L.A. versus the rest of the world," says this person. And the more global Carey function? "We have fantastic execs running our current businesses and see no need to muck that up with another layer."
That could mean latitude for Jim Gianopulos on the film side. Reports that James largely is focused on TV are echoed by film-studio insiders who say neither James nor Lachlan ever has so much as asked to watch a Fox movie. Says one company veteran, "Everyone knows the core of the company is television on all its platforms."