FORTUNE -- It is an iron-clad rule of the contemporary business landscape: Invest in China or imperil your future growth. It's noteworthy, then, that one of the most aggressive western companies in terms of trying to crack the China nut is more or less giving up the fight.
21st Century Fox, the film and TV company Rupert Murdoch cleaved from his print-focused News Corp. (NWSA) this summer, is actively reducing its exposure the world's second-largest economy. It's a shocking development only in that Murdoch spent so many years pursuing the China market so enthusiastically. The company is going out guns-a-blazing too. Murdoch's son James, his only child currently employed as a company executive, has criticized the Chinese government for timidity and a lack of commitment to reform.
Why get out now? "It's always been hard for us in the business of ideas to do business in China," the younger Murdoch said during an extensive interview in July at Fortune's annual technology-industry conference, in Aspen, Colo. "We went from the end of the Jiang Zemin regime, which was liberalizing, trying to do all things, to a much more ... timid approach to investment and to liberalization ... I don't think a lot of people noticed [the shift] enough. And basically it became harder to do business there."
As a result, 21st Century Fox (FOX) has been busy selling off and selling down investments. A few years ago it cuts its stake in broadcaster Star China to below 50%. More recently it reduced its stake in publicly traded Phoenix Satellite Television from 17% to 12%. A spokeswoman says "we're continuing to explore our strategic options," in this and other China investments.
To some extent 21st Century Fox is zigging where others are zagging. Relativity Media and DreamWorks Animation have invested heavily in film production in China. Legendary Entertainment recently signed a deal with China's largest film distributor. (21st Century Fox isn't completely fleeing: A year ago it took a 17% stake in another Chinese film distribution, Bona Film Group.)
But judging James Murdoch's tone -- he is the company's deputy chief operating officer, with responsibilities primarily in global television activities -- China is low on the Murdoch empire's list of priorities. India has become its favored Asian nation. "In the meantime, in the 20 years we've been investing in Asia, contrast what we've achieved in India, [where we own] the largest media company ... which is hugely successful financially and ... from a popularity point of view. We're a big investor in original programming and original writing and content creation in India in nine different languages. It's a fundamentally different animal [from China]." We just decided that [India] was a better place to be."
To some extent, the 21st Century Fox China retreat is a function of its specific industry. "When it comes to the media this is one of the last preserves that China is going to let go of," says Orville Schell, a noted China observer and director of the Asia Society's Center on U.S.-China Relations. "Although many people are making money in China, it's not easy to make money in the media. The closest anyone has come is in public relations, which is really propaganda. And the Chinese understand propaganda."
It's a good time to be in TV. But what about newspapers? It's complicated.
By Matt Vella, senior editor
FORTUNE -- James Murdoch, son of mogul Rupert Murdoch and deputy chief operating officer of the newly formed 21st Century Fox, is not afraid of his mistakes. Speaking at a dinner on the first night of this year's Brainstorm Tech conference, Murdoch seemed, if anything, more afraid of not taking enough missteps. MOREJul 23, 2013 12:01 AM ET
Between WWDC and the e-book antitrust trial, Apple's digital dealmaker has a busy week.
FORTUNE -- If the trade press reports are true, Eddy Cue will take the stage Monday at Apple's World Wide Developers Conference in San Francisco to introduce a new music streaming service that reporters have dubbed -- probably with good reason -- iRadio.
Three days later, Cue is scheduled to appear in a Manhattan federal court as the star witness MOREPhilip Elmer-DeWitt - Jun 9, 2013 6:57 AM ET
News Corp. might seek a waiver of FCC rules in order to buy the Los Angeles Times. Jon Stewart has some questions.
FORTUNE -- Media-ownership rules might or not be outdated, but for now, they still exist. They can be waived, however, to allow media companies to own several different news outlets in the same market. News Corp.(NWSA) chief Rupert Murdoch has received several such waivers over the years, even though MOREDan Mitchell, contributor - Mar 29, 2013 2:33 PM ET
Many suspected two years ago that the iPad-only publication was dead on arrival
FORTUNE -- News Corp. (NWS) announced Monday that The Daily -- the iPad-only publication launched with great fanfare by Rupert Murdoch with the encouragement of Apple's (AAPL) Steve Jobs (and a little speech by Senior VP Eddy Cue) -- will "cease standalone publication" on Dec. 15, one month short of its second birthday.
An unspecified number of the 120 MOREPhilip Elmer-DeWitt - Dec 3, 2012 10:25 AM ET
Fortune's curated selection of tech stories from the long weekend. Sign up to get the round-up delivered to you each and every day.
* Some analysts have previewed the software update for Research in Motion's PlayBook and aren't impressed. Worse, they believe the update will do little to turn the floundering tablet's sales around. (The New York Times)
* Like Netflix (NFLX), Hulu is upping the ante by offering original content like the show Battleground, MOREJP Mangalindan, Writer - Jan 17, 2012 4:15 AM ET
Returns to the venue where Rupert Murdoch launched The Daily on the iPad
Eddy Cue, Apple's (AAPL) senior vice president for Internet software and services, is reported to be in charge of the much-touted special event scheduled for the morning of Jan. 19 in New York City. The wording of the blackboard-like invitation sent to reporters Wednesday -- "Join us for an education announcement in the Big Apple" -- suggests that this could MOREPhilip Elmer-DeWitt - Jan 11, 2012 1:31 PM ET
What if Apple turned the iPad into an easy-to-use front end for real-time financial data?
News Corp. (NWS), a ship that leaks from the top, reports through AllThingsD that Apple (AAPL) has scheduled "an important — but not large-scale" New York City event in late January headlined by Eddy Cue, Apple's senior vice president for Internet software and services.
I'm having a hard time getting as excited about this as Kara Swisher seems MOREPhilip Elmer-DeWitt - Jan 3, 2012 6:52 AM ET
All this talk about an Apple-branded TV set may be missing the point
Reading between the lines of the Wall Street Journal's story Monday about Apple's "assault" on the TV business, you can almost hear the desperation of the media executives who asked Apple (AAPL) to brief them on exactly what the wizards of Cupertino are up to.
These media executive -- which included, presumably, Rupert Murdoch, whose News Corp. (NWS) owns MOREPhilip Elmer-DeWitt - Dec 19, 2011 8:23 AM ET
Fortune's curated selection of newsworthy tech stories from the weekend. Sign up to get the round-up delivered to you every day.
"I am not sure i agree that iPads are making music more accessible than ever. Before man kind had bongos and flutes and guitars and such, pretty accessible stuff." -- Bjork (Midem Blog)
* Steve Jobs was honored at a private memorial at Stanford University's Memorial Church last night. In attendance: Google MOREJP Mangalindan, Writer - Oct 17, 2011 3:30 AM ET
|What stumps Warren Buffett? Minimum wage|
|Water becoming more valuable than gold|
|GM's $1.3 billion recall cost wipes out profit|
|Will 7 Apples a day keep the bears away? - The Buzz|
|Ex-Wal-Mart CEO Duke retired with $140 million|