Look, Rupert Murdoch doesn’t really need much of an introduction—we all know about Murdoch, we all know how powerful and influential he has been throughout his life. But here we look at the very beginnings, the influence of his father, a powerful newspaper executive. We see how young Murdoch started with just 2 newspapers, was underestimated from the get-go but battled his way to the top of the media business in Australia by the age of 37 before setting his sights on the UK. It’s a cracking story.
The Shadow of Sir Keith Murdoch
So Rupert Murdoch was born in Melbourne in 1931.
His mother, Elisabeth, came from a wealthy wool trading family.
His father was Sir Keith Murdoch, one of Australia's most powerful newspaper executives.
Now I don’t usually delve too much into parental backgrounds but because Murdoch’s father Keith had such a huge influence on his career, it’s worth taking a look at him.
Keith Murdoch had started out as a journalist, and during the First World War he made his name reporting on the disastrous Gallipoli campaign, a military operation that was championed by Winston Churchill, and The Rest is History, a podcast I love, has a great series on Churchill which tells the whole Gallipoli story—well worth listening to.
The Gallipoli campaign was a disaster; thousands of Australian soldiers were killed.
Because of British military censorship, Keith Murdoch couldn't report freely on what was happening. So he wrote a long letter directly to the Australian prime minister attacking the British military leadership. The letter helped bring about the eventual withdrawal of Allied troops and made Keith Murdoch something of a national hero back home.
He then worked his way up through the newspaper industry, in 1921 becoming editor of the Melbourne Herald.
And Keith took a very close interest in young Rupert, his only son—he had 3 daughters—and was grooming him for the newspaper business from a very early age. Here’s a quote from Rupert's mother:
“Keith was extraordinary with him. At a very early age he used to talk about newspapers and his plans and hopes for the future.”
And Rupert himself later recalled:
“I saw that life at close range and, after the age of 10 or 12, never really considered any other.”
A Murder, a Headline and a Lesson
So what was young Rupert learning? Well, one thing he was learning was the power of sensationalism, and how to never let the truth get in the way of a good story.
Because when Keith Murdoch took over The Herald, his first big story was the infamous Gun Alley Murder. A 12-year-old schoolgirl had been assaulted and strangled in a city alleyway, and The Herald published photographs of the suspect—a local wine bar owner named Colin Ross, which could have influenced witnesses and potential jury members—and in a breathtaking act of intimidation, printed the names, jobs, and home addresses of the jury members.
The frenzy created by Murdoch's paper was so intense that Ross’s defence lawyer started receiving death threats. And when the lawyer wrote a private letter to Keith Murdoch asking him to ease off, Murdoch printed the private letter on the front page.
And Murdoch's paper seemed to have made up its mind from the very beginning that Ross was guilty. It gave front-page coverage to prosecution witnesses whose credibility was highly questionable, while Ross had a strong alibi, backed up by several witnesses, which the paper treated with scepticism and relegated to the inside pages.
Because Murdoch had his story. Ross was the monster, and that story was selling newspapers. He wasn't particularly interested in anything that might cast doubt on it.
Ross was convicted and hanged. Keith Murdoch celebrated with an enormous front-page headline: "AVENGED." In private, Keith wrote to a colleague: "It was great luck getting the murder story... Circulation leaped up... and it has stayed up."
More than 80 years later, forensic testing proved the key evidence against Ross was wrong, with a relative of the murdered girl emerging as the likely killer. In 2008, Ross received a posthumous pardon.
So young Rupert's lesson here was never let the facts get in the way of a good story.
Keith Murdoch rose up through the ranks of The Herald and Weekly Times, the biggest media group in Australia, eventually becoming the boss. In doing so he became one of the most powerful media figures in Australia, and he leveraged this to gain political influence. And to give you an idea of the power he had, in 1931 his newspapers successfully pushed for Joseph Lyons to become prime minister, and here’s a description given by a journalist of Lyons meeting with Murdoch after he became PM:
"Lyons duly arrived, and there, with his hat in his hand, like a man seeking a job, stood the prime minister before Murdoch's desk. As I shut the door, I heard the leader of the nation say: 'Yes, sir.'"
Young Rupert absolutely adored his father. Here is what he said of him: “he was an example to me and always left me with a clear sense that the media was something different as an industry and that it carried great moral obligations."
That's a pretty interesting quote when you consider some of the morally questionable things both of them did in their media careers.
Anyway, while Keith was this powerful media executive, he didn't own that business—he was effectively a very well-paid, very powerful and very well-regarded managing director of the group.
So as he got older, he started building a smaller newspaper business of his own. There was a definite conflict of interest here, but I think this shows just how powerful Keith Murdoch had become that he was allowed to do this.
Red Rupert
Young Rupert was sent to one of Australia's most prestigious boarding schools. Academically he wasn't especially impressive, and he developed a liking for gambling—horse racing, cards, but also an Australian game called two-up, where two coins are tossed and you bet on how they land.
And I never knew that his liking for gambling stayed with him. He continued betting on horses, and later his company even gambled on foreign currencies. But of course as he got older, his biggest bets were in business.
And politically, while his father was associated with Australia's conservative establishment, young Rupert was a supporter of the Labor Party and in his youth he was very much on the left.
But as we'll see, and as most of us know by now, over the years his political views became much more pragmatic. I read a great phrase in my research—transactional pragmatism—in other words, he was prepared to support politicians from either side if he believed it would serve his business interests.
Rupert leaves school in 1949 and his father takes him to London, introduces him to some of the biggest names in the British newspaper business and gets him a summer job as a junior reporter at the Birmingham Gazette.
And before he leaves when the summer is over, he tells the paper’s owner that the editor is so useless he should be fired. So that gives us a good idea of his confidence in his own abilities.
He then goes to Oxford University to study politics, philosophy and economics.
And according to one of his biographers:
“[he] dabbled in gambling and drinking beer more than his parents felt was good for him”
He kept a bust of Lenin in his room, earning himself the nickname “Red Rupert”.
While there he ran for secretary of Oxford's Labour Club. Now, at the time, the club had a rather unusual rule: candidates weren't allowed to openly campaign for votes.
But Murdoch ignored that, organised a campaign team, handed out leaflets.
And although he reportedly won the election, he was disqualified for breaking the rules.
Murdoch was never really impressed by Oxford's conservative traditions or indeed Oxford itself. In a letter to a friend back in Australia, he wrote the following of Oxford: “Rain, wind, sleet, slush, shit, snow... and starch.”
But in 1952, his final year, tragedy struck: his father, who had health problems for many years, died at the age of 67.
After the funeral Murdoch returned to England because before his death, his father had used his connections to get him a job at the Daily Express in London, one of the toughest and most prestigious schools in journalism. It was a huge newspaper, selling over 4 million copies every day, making it one of the biggest-selling daily newspapers in the world.
While Murdoch stayed at the Express for just a few months as a junior sub-editor, he worked under the paper's legendary deputy editor, Edward Pickering.
Murdoch later recalled how, in those few months, Pickering taught him the core rules of mass-market journalism: the discipline of a picture properly cropped, and the selling power of what Murdoch called the "18-word intro"—in other words hitting the reader with the most dramatic headline, grabbing their attention straight away—the newspaper version of clickbait.
Taking Over at 22
And he brought these learnings back with him in 1953, when he returned to Adelaide to take over News Limited, the small newspaper business his father had been building. He was just 22 years old.
The group consisted of a small regional newspaper, some radio interests and then two large newspapers. The News, a daily tabloid selling around 75,000 copies, and The Mail, the only Sunday newspaper in Adelaide with circulation of 170,000. And because it had no competition, it was very profitable.
And it’s no surprise to learn that Murdoch gets involved in every aspect of the business. Here’s a quote from one of the journalists who worked with him back then:
"He wasn't an owner sitting behind a mahogany desk. He was in the composing room with grease on his fingers, shouting over the rumble of the presses, tearing proofs apart with his hands. He knew every nut and bolt of the mechanical process."
He's looking at advertising, questioning costs—because the fact is that Murdoch is a newspaper guy through and through. He knows it inside out and it’s his first and lifelong love.
The War with Lloyd Dumas
But Murdoch’s ambition, his ruthlessness—these qualities couldn’t be seen in a young 22 year old who had only just started. So some of his competitors thought he was easy pickings and the first person to challenge him was a guy called Sir Lloyd Dumas.
Dumas was one of the most powerful newspaper executives in Australia. He was 62 years old, a knight, silver-haired, impeccably tailored and very much part of Adelaide's wealthy establishment.
He'd actually been a close friend and associate of Murdoch’s father- Keith Murdoch had hired Dumas to run Adelaide’s biggest morning newspaper, called The Advertiser.
Dumas had done an excellent job. The Advertiser was very profitable.
After Keith Murdoch died, and while Rupert was still in England, Dumas approached Keith’s widow, Elisabeth, and tried to persuade her to sell the newspaper business.
When she refused, he launched a rival Sunday newspaper with big backers behind him. And Adelaide wasn't a particularly big market, and there simply wasn't enough business to support two competing Sunday newspapers.
So Dumas and his backers believed that they could afford to lose money for longer than Murdoch could.
But Murdoch of course wasn’t going to take this lying down. As he told his team:
“To hell with them. We’ll fight. Our balance sheet is going to be knocked to hell for a short time [but] it is going to be a great fight and I have complete confidence that we will win.”
And then a month into this battle Murdoch showed that he was prepared to fight dirty, because there was an unwritten rule back then that newspaper owners didn’t publish stories about each other.
But Murdoch’s paper ran a front-page story accusing Dumas of trying to pressure Murdoch’s mother into selling the family business immediately after his father’s death. The story even contained extracts from a private letter Dumas had written to Murdoch’s mother.
This battle goes on for 2 years. They're cutting advertising rates, running promotions, giving things away, doing whatever they can to attract readers.
And they're both losing money.
But crucially, while Murdoch was financially stretched to the limit, he held onto his readers and Dumas was burning through money faster than expected.
In December 1955, Dumas was forced to swallow his pride, pick up the phone, and invite the 24-year-old Murdoch to his office to negotiate a truce.
They agreed to merge their Sunday papers into one business, with each company owning 50%.
And make no mistake, this was a victory for Murdoch and everyone knew it.
Expanding the Business
On the back of this success, Murdoch starts to expand using loans from the Commonwealth Bank. They build a very good relationship with Murdoch and are happy to keep lending to him because he’s being successful.
He buys a newspaper group in Perth, and to give you an idea of the tabloid style that Murdoch is implementing, here is one of the headlines from his Perth newspaper:
“LEPER RAPES VIRGIN, GIVES BIRTH TO MONSTER BABY”.
Murdoch successfully bids for a television licence in Adelaide and then applies for another licence, this time in Perth.
And during the government hearing into the application for this Perth licence, with the authorities obviously wary of his growing media business, Murdoch says the following under oath:
“There is no attempt to build an empire or anything like that. It would not interest me.”
Like the nerve of the guy. Anyway, News Limited’s profits jumped from $62,000 when he began in 1953, to $432,000 in 1959.
Sydney and the Packers
And in 1960 Murdoch moves into the biggest market in Australia: Sydney and what an entrance he made.
So for context, the newspaper market in Sydney is run by 2 families: the Packers—and I already did an episode on Kerry Packer, and the second family are the Fairfaxes.
And while the Packers were the loud, bare-knuckle, street fighters of Australian media, the Fairfaxes were their exact opposite: Australia's oldest, most patrician, God-fearing newspaper aristocracy.
And like Dumas before them, they’ve underestimated Murdoch.
First, the Fairfaxes sell him the Daily Mirror, a struggling Sydney newspaper, believing that the cost of turning it around will bring him down.
And then the Packers come up with a plan to launch a smaller suburban newspaper to take local advertising revenue away from Murdoch.
But to print this smaller newspaper the Packers needed a smaller printing press. So Frank Packer had an agreement to buy a small printer that was about to go into receivership- now Murdoch has also bid for the same business.
And when the owner of the building found out that the receiver had reached an agreement with Frank Packer, he replaced the receiver and gave the new receiver the instruction not to sell to Packer, because he hated Packer’s politics and his bullying ways.
When Frank Packer finds out, he takes the law into his own hands, in typical bully fashion believing in that old saying that possession is nine-tenths of the law.
On the evening of June 7, his 2 sons, Clyde and Kerry along with several employees, entered the printer’s building, barricaded the windows, cut the phone lines and changed the locks.
When the owner found out, he went straight to Murdoch.
And rather than going to the police, Murdoch and the owner hired a local hard man and he gathered a gang of men armed with mallets and wrenches.
At around one in the morning, they forced their way into the building, and an almighty fight broke out.
Kerry Packer was knocked unconscious by a battering ram, his brother Clyde suffered broken ribs, and the Packer group fled.
And Murdoch had sent along a journalist and photographer to cover it all.
So the following morning, his Daily Mirror ran the headline:
"Knight's Sons in City Brawl"—because Frank Packer had recently been knighted.
It had large photographs of the injured Packers and details of how they were chased from the building.
So Murdoch had foiled his main rivals, gotten a fantastic story with great photos, publicly humiliated Frank Packer and in the end successfully bought that printing press.
Within 18 months Murdoch’s Sydney newspaper was outselling its rivals.
And remember, he was doing all this while managing all of his other media assets scattered across a very large country, so he was constantly flying from city to city and working 18-hour days, 7 days a week.
The Australian Gamble
Up to now, while Murdoch's newspapers are widely popular, they are for the most part tabloids. But like all great newspaper owners, Murdoch wants his newspapers to matter politically. He wants the people running the country to pay attention to what he publishes, so he needs a prestigious newspaper.
And at the time, the 2 main newspapers that were read by the political, professional and business class were The Sydney Morning Herald and The Melbourne Age.
But both titles are tied to individual cities and states. There isn't a daily broadsheet that covers the entire country. And there’s a very good logistical reason for this—Australia is huge with a relatively small population, so attempting to get a daily newspaper out to Sydney, Melbourne, Brisbane, Perth and everywhere else on time, every single morning is a big and expensive undertaking.
But that’s exactly what Murdoch sets out to do with the launch of a national daily newspaper, called The Australian.
Murdoch sets up the operation in Canberra, Australia's capital, where the country's parliament sits. He hires experienced journalists and builds a newsroom and printing operation.
It launched in 1964, and the paper was beset with problems from the get-go.
Bad weather regularly delays the planes. Murdoch's biographer William Shawcross tells a story about Murdoch driving to Canberra airport in his pyjamas, pleading with pilots to take off when they said visibility was too poor.
Apparently he'd tell them, "it's not fog, it's just light mist".
And often enough, they did take off.
The opening print run was 250,000 copies. Within a few months circulation was down to 50,000. The paper was losing over £25,000 a week, so well over a million in its first year, which was a huge amount for Murdoch back then.
So he starts making changes—he fires the editor, moves the printing operations to Sydney. This reduced production costs and made national distribution easier.
Within three months, circulation increased to around 75,000 copies, and by the end of the 60s its circulation reached 130,000.
But it still didn’t turn a profit—and it didn’t actually turn a profit until 1985. And it’s estimated over that time it had cost Murdoch a total of $30 million, but Murdoch was more than willing to finance what was effectively a loss leader, because it gave him what he wanted- national political clout.
Radio hosts and the leading current affairs shows began every single broadcast day reading The Australian's front page. So Murdoch was setting the agenda, he was able to dictate what the rest of the country debated.
Playing Kingmaker
And one of the earliest examples of him using that political influence came in December 1967, when Australian Prime Minister Harold Holt disappeared while swimming. This was a huge story at the time.
Holt was spending the weekend at his holiday home near Melbourne when he decided to go for a swim in the sea.
Now, the weather was terrible, the sea was rough, but Holt was an experienced swimmer and went in anyway.
And he simply disappeared. And because his body was never found all sorts of conspiracy theories emerged, including one that he'd been a Chinese spy and had been picked up by a Chinese submarine.
But the most likely explanation, and the official finding, was that he'd drowned.
Anyway, as a result of his death, there was now a battle over who would replace him, and Murdoch threw his support behind one of the leading candidates.
And he used The Australian to help that candidate, running damaging allegations about his main rival on the front page of the Australian for two consecutive days.
And in the end, that rival withdrew from the contest and Murdoch’s man became the prime minister.
So this is probably the first really public display of Murdoch flexing his media muscle and playing the kingmaker.
A Whirlwind in His Personal Life
Now while all of this is going on, there's also a big change happening in his personal life.
Murdoch has been married since 1956 to Patricia and they have a daughter, Prudence.
But in 1966 a young journalist called Anna Torv was assigned to interview him.
And she later described the impression Murdoch made when he arrived: "He was like a whirlwind coming into the room. It was very seductive".
Murdoch divorced Patricia, and in 1967 he marries Anna and they go on to have 3 children, Elisabeth, Lachlan and James.
So by 1968, Murdoch’s media business was estimated to be worth around $50 million, with 8 major newspaper titles, 35 suburban newspapers, 1 TV station, radio stations, magazines, a book publisher, Australia’s largest record label.
But he was still only 37 years old, and despite saying under oath just a few years previously that he’d no ambitions to build a huge media empire, well, he clearly had much bigger ambitions than simply dominating Australia.
So he started looking towards Britain, where the newspaper market was much bigger and where he'd spent time learning the business as a young man.
And in Britain, towards the end of 1968, a fantastic opportunity came along.
The Battle for the News of the World
Robert Maxwell—the flamboyant Czech-born publishing millionaire—who will probably forever more be better known as the father of Ghislaine Maxwell, Jeffrey Epstein's notorious fixer, but Robert Maxwell is a fascinating character in his own right and I will be doing an episode on him. Anyway, he launched a hostile £26 million takeover bid for the News of the World, Britain's biggest selling Sunday newspaper.
The paper was owned by the aristocratic and openly xenophobic Carr family, led by—and I love this description—its gout-ridden chairman, Sir William Carr. So Sir William sounds like a great character. Apparently he drank 2 bottles of scotch a day, he was a brilliant mathematician at least when he was sober and he was known to invite the newspaper employees over to his estate where they’d spend the day quaffing champagne.
But he wasn’t a real newspaperman and while the News of The World was still huge in terms of circulation, it was slowly losing ground.
When Maxwell made his move, the newspaper ran this arrogant, snobbish xenophobic editorial rebutting him. Here’s some of it: "This is a British paper, run by British people ... as British as roast beef and Yorkshire pudding ... Let us keep it that way."
And yet despite all this talk of Britishness, they were willing to reach out to Murdoch and ask him to save the day.
To the Carrs, Murdoch could be viewed as a loyal Commonwealth cousin, who, after all, was at least Oxford-educated, so they reckoned they’d allow him to put in the money, kill off the Maxwell bid, and leave the Carrs to run the paper.
But as has happened throughout his early career, the Brits had underestimated Murdoch.
The dynamic played out at breakfast on the morning of October 22, 1968, at Carr's townhouse in Belgravia.
Murdoch walked in and laid his cards on the table: he would buy a stake in the business and back Sir William Carr, but Carr had to agree to share executive control. Carr balked.
Murdoch pushed his chair back, stood up, and walked toward the front door, before turning around and giving Carr his ultimatum:
"I’m here to help you if you want it. But I don’t like to waste time on dither."
Carr surrendered immediately: "Sit down, Mr. Murdoch."
The deal was done by January 1969. As part of the deal Murdoch promised not to increase his shareholding beyond 40% and he also promised to keep Sir William as chairman.
Now interestingly Robert Maxwell warned Carr that Murdoch would remove him:
"You will be out before your feet touch the ground".
Carr dismissed the warning:
"Bob, Rupert is a gentleman".
Within a few months of the deal being signed, Murdoch increased his shareholding beyond the promised 40% and he kicked Sir William out.
Murdoch had arrived in the UK and was about to have a huge impact on that country's media and political landscape.
Now it’s far too early in Murdoch’s career to pass any definitive judgement on him, but we can already see his ruthlessness, his duplicity, his willingness to lie, his ambition and his innate sense of how the media business works and how he can leverage it to get what he wants—and he’s just 38, and he’s really only starting. What a fascinating character and story.