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The Raging Septuagenarian

Heir apparent James Murdoch.  

Times executives believe Murdoch is practicing his well-established tactic of slashing advertising rates to bleed competitors dry, and the Times’ strategy is to hold the line. “We’re not doing irrational things,” says Times president and general manager Scott Heekin-Canedy. (A Journal spokesperson says, “We have not dropped our rates at all.”) The Times doesn’t want to let Murdoch frighten it into making a mistake. Earlier this winter, executive editor Bill Keller put managing editor Jill Abramson in charge of a committee tasked to review the paper’s New York coverage. Abramson told me that the paper is satisfied with its metro coverage and isn’t planning any drastic countermoves. “I don’t want to sound like some stodgy Timesman of yore by saying the Times is unmatched and sounding arrogant, but I really believe we are unmatched,” Abramson told me. For Abramson, the rivalry with the Journal is personal. She spent a decade at the Journal’s Washington bureau before joining the Times. “I grew up on the Upper West Side. The Times subscription was a religion in our home,” she says. “It was disappointing for the ten years when I worked at the Journal. My parents didn’t subscribe, and my uncle at Lehman Brothers had to call them up to tell them to go down and get the paper whenever I had a story on the front page.”

Thomson, predictably, is contemptuous of Abramson’s efforts. “They are better than the Chinese Communist Party at committees,” he tells me. “I’m sure they’ll always find what they’re doing at the New York Times is perfect. As far as I’m concerned, I’m glad they’ve reached the conclusion that what they do now can’t be improved.”

But Abramson has a point. Whatever one thinks of the Times’ metro coverage, it can’t be denied that their aggressive reporting brought down one governor (Spitzer) and, last week, annihilated David Paterson’s career as well. More broadly, the Times is religion for a particular brand of reader and advertiser. While the Journal’s circulation rose last year, bucking industry trends, Murdoch may not grasp the Times’ appeal to its core audience, for whom the characteristic Murdochian worldview is a sign they should look elsewhere. Among the well-to-do, gray stolidity can even be a virtue.

The Times is an ancient enemy of Murdoch’s. Google is a much newer one. On the afternoon of February 2, Murdoch was on the phone with stock analysts and journalists to spin News Corp.’s second-quarter earnings—a remarkable $254 million second-quarter profit, especially impressive considering that the company lost $6.4 billion in the same quarter last year. Many old-media figures are wringing their hands these days, staring at plummeting revenue charts, waiting for the world to end. Not Murdoch. He was boastful and wildly animated. “Content is not just king, it is the emperor of all things electronic,” he announced. He sees the struggle to control the shifting media landscape in deeply personal, even spiritual terms. “Without content”—without him, he seemed to be saying—“the ever larger and flatter screens, the tablets, e-readers, and the increasingly sophisticated mobile phones would be lifeless.”

Murdoch has a particular animus against Google. He believes the search giant is stealing his content while wrapping itself in that familiar cloak, albeit one with New Age–y Silicon Valley stylings: “Don’t be evil.” Much as he has done in the newspaper wars he’s fought over the last 60 years, he wants to turn the tables, call Google’s moral authority into question. At its core, Murdoch’s fight is about getting Google to pay to put his content into the search index. Publicly, Google treats this as a nonstarter. “We’re not going to pay for indexing,” says Josh Cohen, the head of Google News. “It’s something we just don’t do.”

Before Murdoch realized that Google posed a mortal threat to his empire, he used to praise it, recalls one former News Corp. employee. “We would be sitting in meetings, and he’d go on and on about the Google guys, and how they had dry cleaning and massages, and what a great company and culture it was,” the staffer recalls. When he bought the Journal, Murdoch thought about making online content free, even though the Journal was one of the few successes in fee-based news sites. And Murdoch and Wendi are friends with Google founders Sergey Brin and Larry Page, though they are not as close lately, given the heated nature of their conflict.

Last year, Murdoch and his senior executives decided they needed an organized counteroffensive. As a code name, they chose Project Alesia, named after Julius Caesar’s victorious siege of the Gallic forces in 52 B.C. Murdoch conceived the fight against Google as a political campaign. He mapped out distinct phases. First, Murdoch and Thomson would make a series of provocative speeches to drum up press, using News Corp.’s media outlets and other interview opportunities to shape the debate. In February 2009, during an appearance on Charlie Rose, Thomson said, “Google devalues everything it touches.” In April, Thomson said in an interview, “Certain websites are best described as parasites or tech tapeworms in the intestines of the Internet.” And in December, Murdoch published an op-ed in the Journal declaring that “there are those who think they have a right to take our news content and use it for their own purposes without contributing a penny to its production … To be impolite, it’s theft.”