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News Corp.'s Murdoch: Newspapers Must Embrace Internet

Rupert Murdoch urged newspaper editors Wednesday to embrace the Internet, saying print news executives have "sat by and watched" as a new generation of digital consumers has turned away from newspapers.

The chief executive of News Corp. (NWS) cited a recent report commissioned by the Carnegie Corporation, a philanthropic foundation, showing 44 percent of 18-to-34-year-olds say they use Web sites at least once a day for news.

News Corp. is the parent company of the Fox News Channel, which operates FOXNews.com.

Murdoch said newspapers must overhaul how they gather and deliver news to collect the readers and advertising revenue shifting to the Web.

"The trends are against us. Unless we awaken to these changes which are quite different than those five or six years ago, we will, as an industry, be relegated to the status of also-rans," Murdoch told the annual meeting of the American Society of Newspaper Editors (search).

"We've been slow to react. We've sat by and watched," he said.

When the Web was emerging in the 1990s Murdoch expressed skepticism about its business prospects. He referred to himself and other newspaper executives as "digital migrants" who are too old to have grown up surfing the Net but now must learn to direct their business toward those who did.

"Just watch your teenage kids," he told the editors.

"The challenge for each of us in this room is to create an Internet presence that is compelling enough that users make it their home page. Just as people traditionally started their day with coffee and a newspaper, in the future I hope that the way they start their day online will be with coffee and our Web site."

Murdoch's media empire began with a single Australian newspaper business. Now headquartered in the United States, News Corp. is the parent of the 20th Century Fox (search) movie studio, Fox television network and the New York Post.

In recent years, Murdoch has sought to expand a satellite business in China, but he voiced doubts Wednesday when asked about the business climate there.

"There are indications that it's closing up more than opening up," he said, calling the enterprise "very hard work."

Similar efforts in India have gone much better, he said, even though the potential market is significantly smaller.