Mon, Sep 23, 2013 - Page 14 News List

Murdoch chafed at AllThingsD contract, sources say

SEPARATE WAYS:Although the News Corp CEO was not happy that more than 50 percent of AllThingsD conference revenue went to its founders, the deal was renewed in 2010

Bloomberg

News Corp, which is severing ties with AllThingsD founders Walt Mossberg and Kara Swisher at the end of the year, objected to the terms of the journalists’ contract soon after the media company took over the operation in 2007, two people with knowledge of the matter said.

Mossberg and Swisher together take slightly more than 50 percent of AllThingsD’s conference revenue, including ticket sales and sponsorships, according to people familiar with the business, who asked not to be identified because the terms are private.

The contract was originally negotiated years before News Corp chief executive and chairman Rupert Murdoch acquired AllThingsD as part of his Dow Jones purchase, and he and other executives bristled at the arrangement, people with knowledge of their thinking said.

The AllThingsD Web site started a few years after the conference business started in 2003 and became a top source of news on startups, media and the technology industry.

Even though executives did not view the contract terms as ideal, the arrangement was profitable for News Corp and the company extended the partnership for three additional years in 2010, according to the people.

Still, management did not expect the agreement to continue beyond this year, they said.

Swisher disagreed with that characterization on Saturday, saying in an interview: “I have no idea if Rupert was unhappy or not with the previous contract, but News Corp negotiated a new one that they happily signed in 2010.”

The split leaves News Corp without two of its highest-profile business journalists, while sending Mossberg and Swisher in search of new partners and investors.

The pair said last week that they would have a new Web site and conference business starting Jan. 1 next year under a different corporate structure.

Mossberg and Swisher have been in talks with two potential backers: Comcast Corp’s NBCUniversal and magazine publisher Hearst Corp, according to people with knowledge of the negotiations.

The talks with NBCUniversal included the possibility of creating a new technology show for CNBC that would be based on the same kind of coverage found in AllThingsD.com, two people said. The financial cable network has recently looked at ways to increase its coverage of Silicon Valley startups and businesses, according to people with direct knowledge of those discussions.

Mossberg and Swisher are also working out plans to bring along all of the current AllThingsD editorial and administrative staff and would give them an equity stake in the new venture, three of the people said.

“While we can’t give any details yet — and there are details — you can assume that this new independent business will be laser-focused on continuing and extending Web journalism and conference journalism with the highest standards,” Swisher and Mossberg said in a statement on the AllThingsD site. “Plus, we will finally be able to have added resources, so we can grow in new and exciting ways, including hiring more journalists and doing much more video.”

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