Leave it to iconic News Corp. (NYSE: NWS ) chairman Rupert Murdoch to stir up trouble. According to a brief snippet from an interview in the Feb. 13 issue of Newsweek, Murdoch has made "quite considerable progress" in developing a Fox-branded competitor to General Electric's (NYSE: GE ) CNBC business news channel, which he says will air before year's end.
So it's bye-bye, Squawk Box. Hello, Fox and Friends? Not exactly, but the move does make plenty of strategic sense. Why, you ask? For one thing, Fox News Channel is a ratings powerhouse. According to MediaWeek, FNC averages more than double the number of prime-time viewers of Time Warner's (NYSE: TWX ) CNN, and it corrals more than four times the number of eyeballs of MSNBC. A business channel might be able to pull in viewers from FNC's coattails, further crimping competitors.
They need crimping. CNBC, in particular. Fox has no answer for the channel. That's bad for Murdoch, because Americans seem to be in love with stocks. Indeed, according to the same MediaWeek data referenced above, CNBC saw its viewership rise a breathtaking 23% in January. My guess is that Murdoch would like to seize some of that momentum for his own empire.
I can't help but think the idea makes economic sense. Well, at least as far as Murdoch is concerned. He plans to blend digital and classic media by extending broadband service through DirecTV (NYSE: DTV ) , increasing access to his digital properties, which now includes social networking powerhouse MySpace.com. All told, Murdoch says the strategy will result in $1 billion in revenue by 2010.
Expect business news to be a part of the mix. For, as we here at the Fool know well, there's a natural blend between the Web and other media when it comes to stocks and business. The trick is monetizing the convergence. With a track record for smashing competitors and gobbling up opportunities, I'm reasonably compelled to think Murdoch will figure it out.
Tune in to related Foolishness:
- Do the television shuffle!
- Go ahead, tune intoYahoo! (Nasdaq: YHOO ) .
- DirecTV wants your Fox shows to be on demand.
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