News Corporation's Strategic Position In 2004 example essay topic

The early 1980's were the years of the company's accelerated development, growth and expansion. In November 1994, the News Corporation Limited was reorganized and re domiciled in the United States (Ferguson, 2004). This strategic expansion was focused mainly on traditional product areas, such as magazines and newspapers, and by 1984 the company's revenues were about A$2 bn (McQuade, 2004). Yet, the mid-1980's brought the company's many unexpected challenges, as these were the years of the major geographic and product shift. As it was already mentioned, the News Corporation's expansion was focused on the U.S. CEO wanted to make a 'vertically integrated global media group, with a place in all parts of that industry from newspapers to television, from magazine to film' (McQuade, 2004). The subsequent years were the years of internationalization, as Murdoch has acquired the film company Twentieth Century Fox (in 1984), and has purchased another six television stations of the Metro media broadcasting group in 1985 (Powell, 1991).

By doing this, the News Corporation get an access to studios, and the company was now able to make various films and television programs. Apart from that the company got access to a film library of over 2,000 titles, and a perfect distribution platform for the content available (McQuade, 2004). These opportunities allowed Murdoch to establish the Fox Broadcasting Company and make it the fourth national television broadcast ed in the U.S. in the late 1980's. These were the years of successful expansion. The U.S. internationalization allowed the company to increase its profits, but it has also increased the company's debt levels. In order not to breach private bank loan agreements (total borrowings to exceed new assets by not more than 10%), and not to conflict the U.S. law, according to which foreign citizens were not allowed to hold more than 25% of any company with a broadcasting license, Murdoch became a U.S. citizen in 1985.

The News Corporation remained an Australian corporation until 2004, when the company's CEO decided to make it American. In addition, among all international issues, there were changes related to liberalization and deregulation of the national broadcasting oligopolies and monopolies. These changes also had impact on the News Corporation, as the company had to adopt the most efficient strategy. Similar to any other company, the News Corporation has faces the necessity to think and act environmentally, - in the ways able to protect the environment.

Rupert Murdoch, CEO of the News Corporation has entered the 'fast-growing cadre of corporate leaders pressing for climate action' (Little, 2007). In 2007 the News Corporation has announced launching an initiative that aims both to reduce the News Corporation's emissions, and a set of promises to include climate messaging into the content and programming of the corporation's holdings. As it is claimed by Murdoch, the company faced a need not only to revolutionize the climate change message in the company's activities, but rather the need to make it vivid, dramatic and fun, in order to inspire the population to change their behavior concerning the most important environmental issues. According to the promises, the company decided to reduce its carbon footprint 10% by the year 2012 through the use of renewable energy and the company's energy efficiency efforts (Little, 2007).

The News Corporation plans to become carbon-neutral by 2010, as it plans to purchase emission offsets from such projects like wind farms in India, and some other initiatives. The company considers that although their carbon footprint is extremely high, their target group, the audience comprising of hundreds of millions viewers, is the most favorable ground for change, as the audience's carbon footprint is 10,000 times higher than the corporation's. These changes in the company's strategy represent the most dramatic changes concerning its environmental policy, as Rupert Murdoch previously was known for his most conservative politics on environmental issues. Rupert Murdoch decided to change his strategy, as the company's advertisers were consistently asking the News Corporation for the ways to reach the audience on this issue. In addition, Murdoch considers that addressing environmental issues along with the company's new climate strategy will held them to reduce energy costs, and help the company's executives to recruit top talent, and provide a chance to 'deepen their relationships with the viewers, readers, and web users' (Little, 2007). Apart from that, the News Corporation plans new green programming on the motorcycle and car cable network SPEED, the channel dedicated to climate change on MySpace, the new program "Preserve Our Planet" on the National Geographic Channel, and some other initiatives that will allow the company retain its positions on the media market.

The News Corporation's strategic Position in 2004 In order to analyze and evaluate The News Corporation's strategic position in 2004, it is necessary to explore it both internally (looking at the financial ration, balances shit, debt & equity ratio, profitability ratio, etc. ), and externally (using Porter's Five Forces to analyze). So, The News Corporation's strategic position in 2004 was rather strong. By 2001 the situation for the News Corporation was weak (Chomsky, 2003). In 2001 the company has reported losses that made up about A$746 million dollars due to changes in accounting policy, resulted in a 'one-off pre-tax charge to profit of A$1, 07 m with an associated tax benefit of A$421 m in the fiscal year 2001 (McQuade, 2004). This change in the accounting policy was dictated by the desire to ensure continued consistency with the generally accepted U.S. accounting principles for producers and distributors of the companies. This kind of change could be a predatory change towards making the company the American one; however, it could also be an attempt to "secure investor confidence in the wake of the raft of corporate scandals in 2001' (McQuade, 2004).