Inside Story

The first succession… and its consequences

Two new books reveal the intriguing origins of Rupert Murdoch’s global empire

Tom Greenwell Books 15 August 2023 4083 words

“Comrade Murdoch” at the White House: Rupert Murdoch (right) with US president John F. Kennedy and Sydney Daily Mirror correspondent Zell Rabin in December 1961. Alamy

When the creator of HBO’s hit TV drama Succession announced in February that the show’s fourth series would be its last, he dropped a tantalising caveat. The portrayal of a family patriarch living out life’s “second half” to the fullest had come to an end, but “maybe there’s another part of this world we could come back to,” Jesse Armstrong mused to the New Yorker. Or “something else in an allied world, or allied characters, or some of the same characters.”

If Armstrong is ever to pursue such a possibility he could do a lot worse than take out options on two new books that tell the story of the original succession, when Rupert Murdoch inherited the keys to his media kingdom from his father Keith. Together, they not only provide a Succession-worthy dose of power plays and court intrigue; they also offer a profound insight into where Rupert Murdoch came from, what he would become and how he has shaped our world.

Walter Marsh’s Young Rupert provides a richly detailed and intricately interwoven close-up view of the young Murdoch on the make in 1950s Adelaide, building the business he inherited from his father. Media Monsters, the second volume of Sally Young’s exhaustively researched and endlessly fascinating history of the Australian media, tells that story in more condensed form but takes it further, as Murdoch extends his operations to the east coast, creates the Australian and throws all his weight behind the election of the Whitlam-led Labor Party in 1972.

The first succession, it turns out, involved at least as much Machiavellian intrigue, internecine struggle and human frailty as the present one; its consequences, it need hardly be said, are still being felt today.

The story begins, inevitably enough, with a very powerful man who, despite age and ailment, can’t bring himself to relinquish control. In 1949, Keith Murdoch was chairman of the board and managing director of Australia’s largest newspaper company, the Herald and Weekly Times, or HWT. There he had grown accustomed to unrivalled influence, claiming credit for the rise and fall of governments and prime ministers.

“I put him there and I’ll put him out,” Murdoch contemptuously said of prime minister Joseph Lyons in the 1930s. When Bob Menzies became prime minister for the second time he immediately sent Murdoch a note thanking him for using his newspapers to energetically campaign on his behalf. There was nothing self-effacing in Murdoch’s reply, which noted that the swing to Menzies was largest where his papers held sway.

But ill-health was catching up with Murdoch, forcing him to spend long periods away from the office. And so he announced a kind-of-retirement. While he would remain on as chairman, he was stepping down as managing director, charging one of his “bright young men,” Jack Williams, with responsibility for day-to-day affairs.

Except Murdoch couldn’t let go. He surrounded Williams with rivals, bad-mouthed him behind his back and sometimes to his face, and constantly interfered in day-to-day management. Williams had his faults, not least a serious drinking problem; one night he was arrested for urinating in Melbourne’s Alfred Place. But friends believed it was Murdoch who was driving Williams to drink.

The simmering tension between the chairman and his erstwhile protégé came to a head in late 1952 when Murdoch gathered together his fellow board members and persuaded them that Williams had to go. Having reclaimed undiluted control, Murdoch travelled out to his property on the Mornington Peninsula to spend the weekend.

And there he died. Within hours of the news, Williams had returned to the HWT offices where he ordered an engineer to blast open the now deceased chairman’s private safe. Armed with the revelations contained therein, he managed to persuade the remaining board members to reconsider their decision to terminate his own employment. At a hastily convened meeting he was reinstated — and the minutes of the previous meeting were expunged from the record.

For all that Keith Murdoch had refused, in the last years of his life, to let power slip from his hands at the Herald and Weekly Times, much of his energy had been focused elsewhere. As a minor HWT shareholder, he knew he would never be in a position to pass on the reins to his young son, Rupert. Thus he had devoted himself to building a media business of his own, one to which the laws of primogeniture would apply.

To set up his son’s inheritance, Murdoch had taken on substantial debt and a shady business partner, refusing to let his fiduciary duties to HWT shareholders stand in the way of securing the succession he cared about most. Or, as Young puts the matter bluntly, Murdoch “conned News Limited off [the HWT] for his son.”

Three years before his death Murdoch had told the HWT board that their position in Adelaide, where the company had effective control of both the city’s daily newspapers, was no longer tenable. In the wake of a royal commission into the press in Britain, monopoly power was under intense scrutiny. It would be prudent, he suggested, to pre-empt government intervention and offload one of their papers.

But Murdoch was less than candid about how such a move might benefit him personally. “When Murdoch told the annual meeting of shareholders in December 1949 that the HWT’s shares in News Limited had been sold,” writes Marsh, “he did not disclose that he was the purchaser.”

Murdoch’s extracurricular activities, as Marsh aptly describes them, were no secret by the time of his death. But his private papers revealed the full extent of these operations and the tremendous conflicts of interest they entailed. Like the secret negotiations Murdoch was conducting to defect from the HWT and merge his company with the owner of one of its main Melbourne rivals, the Argus. Or the fact that Murdoch’s partner in Queensland Newspapers, owner of the Courier-Mail, was none other than the underworld figure made famous by Frank Hardy’s Power Without Glory, John Wren.

Jack Williams was back in charge, and one of his first tasks was to produce a glowing obituary for his mentor-turned-nemesis; he would also serve as a pallbearer at Murdoch’s funeral some days later. As Marsh wryly observes, “It’s hard to imagine any circumstances in which Sir Keith would have approved of this chain of events, but as Williams helped carry him from the church, he was in no position to object.”

Nor could Murdoch object as his old colleagues at the HWT sought to reacquire the company he had prized from it, News Limited. Barely had Keith been buried before his young widow, Elisabeth, was approached. The HWT, she was informed, was about to begin a Sunday edition of the Advertiser that would in all likelihood kill off News Limited’s Sunday Mail. Wouldn’t she prefer to sell first, they asked. Indeed, wouldn’t life be easier without the burdens of owning and running her late husband’s entire newspaper business?

Elisabeth didn’t take the bait. But — determined to clear the significant debt her late husband had racked up — she sold them the Courier-Mail. The young Rupert, who had hurried back from Oxford to claim his inheritance, was bitterly disappointed. “Cunning old bastards,” he called his dad’s former colleagues, but he must have recognised that his father was the most cunning of them all, and he was the prime beneficiary of the bastardry.

Thus Marsh and Young tell a story that revolves around not one succession but two — the fates of the very large business Keith Murdoch managed and the much smaller one he owned — and the conflict between the two. The resulting inheritance might have been smaller than both Keith and Rupert had hoped but, as Sally Young emphasises, it was nothing to complain about: three newspapers (the daily News and the Sunday Mail in Adelaide, and the Barrier Miner in Broken Hill) as well as a significant stake in the weekly women’s magazine New Idea, and a number of radio stations.

But young Rupert inherited more than assets with the potential to generate substantial revenue. He entered an elite club that exercised enormous control over Australia’s political and economic life. A large part of Sally Young’s achievement in Media Monsters is to lay bare the true extent of that power; in so doing she offers a profound insight into what Keith Murdoch really bequeathed his son.

As familiar as the troubling relationship between politicians and newspaper proprietors is, the effect of Young’s meticulous research is to surface details that still retain their power to shock (as well as containing remarkable contemporary resonances).

Witness the remarkable role of the press barons in the founding of the Liberal Party. In late 1944, Menzies was invited to dinner at the Melbourne home of a senior mining executive. In attendance were all the country’s leading media figures, including Keith Murdoch, Frank Packer and Rupert Henderson, manager of the Sydney Morning Herald. By the end of the evening, all those present had agreed to do everything in their power — which was considerable — to bring the Liberal Party into existence. “None of this secret compact was disclosed in the attendees’ respective newspapers,” Young sharply observes, “and nor is the remarkable dinner mentioned in official accounts of the Liberal Party’s history.”

The press proprietors collectively backed the party to the hilt over subsequent decades. Measured in terms of editorial support during federal elections, Australia’s daily newspapers supported the Liberals 90 per cent of the time during the fifties and sixties. But it’s the details of this cosy collaboration that are truly revealing. After the half-Senate election in 1953, Menzies sent a message to the editor of the Courier-Mail, Colin Bednall. “My dear Colin,” Menzies wrote, “I cannot go abroad without writing to let you know how much we have all appreciated the attitude of the Courier-Mail during the Senate campaign. No government could have asked for its case to be better or more enthusiastically presented.”

Menzies received an equally sympathetic hearing on radio. He requested, and received, extraordinary, unfettered access to the listening public through weekly ten-minute Man to Man broadcasts on forty stations across the country. The media barons hoped the opposition leader, H.V. Evatt, “would not complain or demand equal time,” Young explains. “He did both, but was ignored.”

The Liberal leader made sure these favours didn’t go unrequited, making a series of decisions that shaped the new medium of television in the interests of his powerful media allies. When he announced a royal commission into the introduction of television, the first commissioner chosen was the aforementioned Courier-Mail editor, Colin Bednall. Suitably stacked, the commission delivered predictably congenial recommendations, and Menzies did the rest to ensure the newspaper proprietors who already had a licence to print money would be well positioned to make even more.

The television market established by the Menzies government was at once highly concentrated and poorly regulated, lacking the pluralism and diversity of American television on the one hand, or the public service character of the British model on the other.

The UHF band already in operation in the United States could carry hundreds of television stations, including channels reserved for community groups and educational purposes; Australia opted for the much more restricted VHF band. In Britain commercial broadcasting took place under a public service model with similar obligations and programming standards to the BBC’s. In Australia, such regulation and oversight was successfully resisted, and private ownership of television transmitters made it practically impossible to revoke commercial television licences, and therefore to rigorously enforce any standards.

If blatant partisanship, the parlaying of political support into commercial benefit and the concomitant degradation of the public sphere would, in time, come to epitomise Rupert Murdoch’s way of doing business, what is remarkable in both Young’s and Marsh’s accounts is the extent to which he initially resisted playing this game. To be sure, he took to the role of publisher with gusto, fending off the HWT’s assault on his lucrative Sunday paper in Adelaide, acquiring Perth’s Sunday Times in 1954 (where he first exhibited his talent for tabloid sensationalism) and securing the license for the NWS-9 station when television came to Adelaide in 1958.

Marsh comprehensively establishes that Murdoch was always ruthlessly ambitious and that intellectual consistency was never really his thing (he believed in the benefits of competition as long as he was the beneficiary). But, for all that, the young magnate forms a striking contrast to his father, his contemporaries and, above all, his older self.

It may just be a historical curiosity that the young Rupert was an ardent socialist known as Comrade Murdoch at Geelong Grammar; that he installed a bust of Lenin in his rooms at Oxford; or that he engaged in an admiring correspondence with Ben Chifley. But even after he had taken over the family business his politics retained a decidedly leftist hue. In Adelaide he hobnobbed with future Whitlam minister Clyde Cameron, and flirted with the Fabian Society. “He was much further left than me,” Cameron recalled in his memoir.

Even if Cameron exaggerated for effect, his recollection clearly contains a strong kernel of truth. Sally Young describes the Adelaide News in the 1950s as “the most liberal daily paper in the country, one with a social conscience that published very different views to the establishment Advertiser.” Similarly, in its early years the Australian was exceptional in its willingness to question conservative governments. It was the sole morning newspaper to editorialise against Australia’s commitment of troops to Vietnam. Then, of course, there was Murdoch’s energetic and enthusiastic campaigning for Labor in 1972, prior to his rejection of Whitlam and his long march to the right.

The most revealing insight into Murdoch’s politics in this period is found in Marsh’s rich account of the case of Arrernte man and itinerant carnival worker Rupert Max Stuart, sentenced to death in 1959 for the gruesome rape and murder of a young girl. In the wake of Stuart’s trial, Murdoch’s News ran a series of reports that brought the veracity and justice of the conviction into serious question. First, it was revealed that Stuart had neither translator nor legal representation on hand when he made a confession; then that it had been beaten out of him; and finally that he appeared to have an alibi. With financial support from the News, a concerned clergyman had tracked down Stuart’s former employer, now interstate, who testified that the convicted man was with him at the time the crime occurred. PRIEST: STUART HAS PERFECT ALIBI, ran the headline in the News, DELAY THIS HANGING.

South Australian premier Tom Playford announced a royal commission and a one-month reprieve for Stuart, and one British newspaper described Murdoch’s editor, Rohan Rivett, as the “Zola of South Australia.” But Murdoch’s convictions were about to be tested further, when the royal commission the News had done so much to establish ended in acrimony, with Stuart’s counsel, Jack Shand, walking out. COMMISSION BREAKS UP — SHAND BLASTS NAPIER, read one News headline; SHAND QUITS — “YOU WON’T GIVE STUART FAIR GO” blared another.

If, with the passing of half a century, these statements seem like a pretty reasonable rendering of what had transpired, that was not how they were received at the time. The News was deemed to have impugned the integrity of the court, and Rivett and Murdoch found themselves facing a series of libel and seditious libel charges. They stuck it out and, ultimately, the charges were dropped but only after a long, expensive and intimidating legal action. Meanwhile, Max Stuart’s conviction stood, and he served out a lengthy jail sentence (the question of his guilt remains murky). But his life was spared.

It’s impossible to absorb these events, also comprehensively covered in Media Monsters, without reflecting on the story of a similar — and similarly horrifying case — that occurred three decades earlier. On the last day of 1922 a twelve-year-old girl was found raped and murdered in an alley off Melbourne’s Little Collins Street. Soon a local publican, Colin Ross, was in the police’s crosshairs. The editor of the Melbourne Herald, Keith Murdoch, was thrilled: he had learned firsthand from his British mentor, Lord Northcliffe, what a good murder could do for circulation.

Under Keith’s direction, the sensational allegations against Ross were flogged for all they were worth, sales nearly doubled, and Ross — who was exonerated by DNA evidence seventy-five years later — was convicted and hanged. So notorious was the Herald’s commercialisation of the case that its new headquarters on Flinders Street, built in the years following Ross’s hanging, were long known as the Colin Ross Memorial. The Colin Ross Memorial was where the teenaged Rupert Murdoch would get his first taste of the newspaper business. It is difficult to believe the case was far from his mind as he campaigned against the execution of Max Stuart throughout 1958 and 1959.

For all that the Stuart case exhibited Murdoch’s long-lost idealism, it also taught the young proprietor a critical lesson about the newspaper business and the consequences of offending the advertisers who were his main source of revenue. With the case still in full swing Murdoch told Clyde Cameron, “I’m in a spot Clyde. Myers have phoned to say that unless we drop our campaign in favour of Stuart, they are going to withdraw all of their advertising from the News and that means a lot to us…”

In the short term, Murdoch withstood the pressure, but only weeks after the conclusion of legal action against the News, he sacked Rohan Rivett. Keith Murdoch had confidently predicted, a year before his death, that his then socialist son would “eventually travel the same course of his father.” This sacking was one of the first signs that Keith would in time be proved completely correct (with interest on top); it also indicated that Rupert had fully registered the true commercial consequences of his editor’s campaigns.

Around the same time, Murdoch learned an even more important lesson about surviving and thriving in a business in which the majority of revenue came from selling advertising, when he witnessed the spectacular failure of the Melbourne Argus. In 1949, the Argus’s editorial line had taken a sharp turn to the left, a marked departure from the arch-conservatism that had characterised the paper for most of the preceding century.

The shift from right to left was effected at dizzying speed and in the process the paper’s new British owners made a number of serious missteps. But, as Sally Young explains, when the Argus was shuttered in 1957 its audience had actually grown. The problem was that “advertisers had shunned the bolshy, down-market, more left-wing paper. That was the deathblow, rather than a loss of readers,” writes Young. “When the paper closed in 1957, it had 170,000 readers, and that was 42,000 more than the Age, and a higher circulation than five other capital city dailies had at that time.” The Argus failed because its moderate leftwards tendency attracted less pecunious readers who were less sought after by advertisers.

The case of the Argus is crucial to understanding the nature of the Australian press in Rupert Murdoch’s formative years. The ideological commitments of proprietors provides one explanation for the overwhelming conservatism of Australia’s newspapers, but not the only one. After all, the proprietors had to win a readership and this meant selling their papers to a nation that was roughly equally politically divided. Even at its high watermark in 1966, the Coalition’s two-party-preferred vote was only 57 per cent — evidence of a far more politically divided nation than its daily newspapers suggested.

What the Argus experiment clearly indicated was that the preferences of readers were of secondary financial importance to the preferences of advertisers for the attention of a particular type of reader — one with high disposable income. Left-wing working-class newspapers faced a structural obstacle: a lesson not lost on Rupert Murdoch who, Young notes, “would use the Argus as a cautionary tale. He said a lack of advertiser support killed it and only 5 per cent more advertising would have made a big difference to its future.”

In their seminal history of the British press, Power Without Responsibility, James Curran and Jean Seaton attribute a decisive role to advertising in determining the commercial viability of newspapers since the nineteenth century. And they also tell a story of central importance in the career of Rupert Murdoch: the strange death of a newspaper called the Daily Herald and its rebirth under a new name, the Sun.

The demise of the Daily Herald was similar in nature to that of the Argus, only amplified in scale and consequence. When it was shut down in 1964 its circulation was 1.26 million, greater than that of the Times, the Financial Times and the Guardian combined. Surveys indicated that its readers took in more of their paper than the readers of other major dailies — and felt more attached to it. Its problem? It ultimately couldn’t compete financially with rivals who enjoyed the favour of advertisers. The Daily Herald readership might have been very large but it was overwhelmingly working-class, with minimal disposable income, reflective of the paper’s radical politics, and thus relatively unattractive to advertisers. Despite obtaining 8.1 per cent of national daily circulation in its final years, the Herald received only 3.5 per cent of net advertising revenue.

A decade before its downfall, the Daily Herald’s owners had recognised that they faced a choice. Either they could go really mass-market and cater to the advertisers who were more interested in quantity than “quality.” To do this, the paper would have to shed its political identity, and associated coverage of union matters, and ratchet up the human-interest stories, cartoons and horoscopes. Or they could go for quality by focusing on attracting the young, affluent audience that advertisers were willing to pay top dollar for.

The rebranding of the paper as the Sun was a belated attempt to pursue this latter strategy, but its half-hearted execution lacked strong internal support. And so, in 1969, the floundering paper was offloaded to Rupert Murdoch. Unlike the previous owners, Murdoch decided to take the Sun down-market and brought an unabashed and unqualified commitment to doing so. “I want a tearaway paper with lots of tits in it,” was the edict delivered to the Sun’s new editor. Circulation doubled within twelve months.

Rupert Murdoch is, of course, far from the first person to cast aside youthful ideals in pursuit of profit and power, or to tread the path from rebellion to reaction, a journey abetted in his case by the coincidence of middle age with the global turn to neoliberalism. But if a person is ultimately an opportunist it pays to attend to the opportunities the world affords them. The young media mogul on the make was consistently confronted with a powerful set of commercial incentives that decisively shaped his course: avoid offending advertisers and maximise the audiences that advertisers are willing to pay for.

When Murdoch made his next big move, to the United States, he entered a media landscape that had been powerfully shaped by the same forces he had encountered in Australia and the United Kingdom. In the 2019 book No Longer Newsworthy the American media scholar Christopher R. Martin describes how postwar American newspapers became increasingly defined by the pursuit of high socioeconomic status readers, the kind advertisers desired. Editorially, that meant a declining coverage of industrial relations, and strikes in particular. And when strikes were reported, the framing shifted from open-minded engagement with workers’ demands to an increasingly dominant focus on inconvenienced consumers.

As reporters were taken off industrial relations beats, financial self-help columns and coverage of the stock market increased. And as the mainstream media stopped telling working-class stories, right-wing cultural warriors were only too willing to fill the vacuum, with figures like televangelist Pat Robertson and ultraconservative shock jock Rush Limbaugh stepping into the void — as, eventually, did Murdoch’s Fox News. But, says Martin, America’s “right-wing media complex got its start with Rupert Murdoch’s purchase of the New York Post in 1976.” •

Young Rupert: The Making of the Murdoch Empire
By Walter Marsh | Scribe | $35.00 | 352 pages
Media Monsters: The Transformation of Australia’s Newspaper Empires
By Sally Young | UNSW Press | $49.99 | 576 pages