Murdoch remains News Corporation deputy chief operating officer and keeps responsibility for BSkyB as he moves to New York

This article is more than 8 years old

This article is more than 8 years old

James Murdoch has stepped down as chairman of News International, the publisher of the Sun and Times, in an internal News Corporation reshuffle.

Wednesday's move sees him give up responsibility for News Corp's crisis-hit British newspaper operation as he completes his relocation to New York.

The man once seen as his father Rupert Murdoch's automatic heir at the top of News Corp retains existing responsibility for "global television", overseeing busineses including the company's 39% stake in BSkyB, Sky-branded pay-TV companies in Europe and Star in Asia – and only gains the opportunity to become involved with the company's US Fox television operation as he settles in across the Atlantic.

James Murdoch's managerial move away from News International explains why he was not in London to help oversee the launch of the Sun's Sunday edition, which has been personally supervised by his father.

Friends say he has been eager to leave the UK and drop responsibility for the Wapping newspapers for several months as the phone hacking scandal enveloped the London outpost of the organisation.

He has faced repeated questions over what he knew about the extent of phone-hacking at the News of the World.

Although the hacking is known to have gone on until 2006, before Murdoch arrived, he presided over a period in 2009 and 2010 where News International denied again and again that phone-hacking was more widespread than the activities of a "single rogue" reporter.

News International, meanwhile, becomes the only newspaper unit of the company not to report directly to a man named Murdoch.

News International chief executive Tom Mockridge will now report to Chase Carey, the US television executive who is the company's number two, its president and chief operating officer.

By contrast those who run Dow Jones, the Wall Street Journal publisher, and News Ltd, the Australian newspaper operation, both report directly to Rupert Murdoch.

Carey told a Deutsche Bank media conference in the US on Tuesday that News Corp executives have talked about selling off or separating the company's newspaper operations from the rest of the business, according to Bloomberg.

In response to a question at the conference, Carey said there certainly was an awareness that News Corp would trade at higher multiples if it did not own newspapers.

The company derives more than 70% of its operating income from its TV businesses, which include the Fox TV network and production arm, and cable channels such as FX and Fox News. Publishing accounts for less than a fifth of annual operating income and is "significantly down year-on-year on profitability", according to Carey.

James Murdoch took up the job overseeing News International in December 2007, when he joined News Corp from BSkyB, where he had been chief executive. At the time he also became the chief executive for News Corporation Europe and Asia, responsibilities which he retains.

The company said in a statement: "News Corporation today announced that, following his relocation to the company's headquarters in New York, James Murdoch, deputy chief operating officer, has relinquished his position as executive chairman of News International, its UK publishing unit.

"Tom Mockridge, chief executive officer of News International, will continue in his post and will report to News Corporation president and COO Chase Carey."

Rupert Murdoch praised his son's four year stewardship of News Corp's international businesses from London.

"We are all grateful for James' leadership at News International and across Europe and Asia, where he has made lasting contributions to the group's strategy in paid digital content and its efforts to improve and enhance governance programs," he said.

"He has demonstrated leadership and continues to create great value at Star TV, Sky Deutschland, Sky Italia, and BSkyB. Now that he has moved to New York, James will continue to assume a variety of essential corporate leadership mandates, with particular focus on important pay-TV businesses and broader international operations."

James Murdoch said: "I deeply appreciate the dedication of my many talented colleagues at News International who work tirelessly to inform the public and am confident about the tremendous momentum we have achieved under the leadership of my father and Tom Mockridge.

"With the successful launch of the Sun on Sunday and new business practices in place across all titles, News International is now in a strong position to build on its successes in the future. As deputy chief operating officer, I look forward to expanding my commitment to News Corporation's international television businesses and other key initiatives across the company."

One New York-based media executive said the idea of James Murdoch running any significant part of News Corp's US business was ridiculous.

"There's too much trouble hanging over his head," the executive said. "All this newspaper stuff just seems to get worse by the day. How can anyone expect him to fully commit to anything else?

"And anyone who works with him is going to be wondering how long he's going to be around. It would have been easier to let him go. Looks like Rupert is getting sentimental."

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