The departure of Rupert Murdoch from his two core media groups Fox in the US and News Corp is a signal moment.

There is to be no succession struggle for the time being, with eldest son Lachlan taking the helm.

But with three other siblings having voting stock in a Nevada-based family trust, an eventual challenge cannot be ruled out.

The scale of the empire is much diminished. Murdoch completed one of the deals of this century when he sold most of US entertainment empire to Disney in what was billed as a $71.3billion (£57.5billion) deal in 2019. 

It was a top-of-the-market transaction and Disney has struggled ever since to make it work amid a subsiding share price and the return of chief executive Bob Iger.

The other coup was the sale of Britain’s Sky to American cable giant Comcast for $39billion (£31.5billion) a year earlier.

Murdoch’s willingness to take brave, far reaching decisions in a fast changing world of media and communications largely went unsung. Instead, he is often cast in the media as an evil genius with too much political power.

The rump of Rupert Murdoch’s media empire will need some reshaping. The Fox Corp’s alliance with Donald Trump has cost it dearly. 

Earlier this year, it forked out $800million (£645million) in a legal battle with election equipment supplier Dominion over the network’s alleged spread of voting conspiracy theories. 

Fox news channels remain immensely popular, when rivals such as CNN are languishing.

However, so called ‘cord cutting’ is challenging the cable subscription model. The popularity of streaming services and the challenge of how to make a profitable transition is very real.

The change of leadership will also put News Corp – owner of the Sun, Times and Wall Street Journal – in the frame for change. 

The titles are all engaged in what is proving a fertile conversion from paper to digital. But the shadow of the phone hacking past of the Sun still hangs over that title. 

Newspapers are deeply embedded in the Murdoch DNA. But the transition to the next generation won’t be entirely smooth.

Generation game

A larger and more resilient economy is delivering the Chancellor Jeremy Hunt higher receipts than projected at the time of the March budget, and enabling him to build a mini war-chest. 

Main drivers are PAYE receipts and VAT both of which tell us the economy is not down and out.

Inheritance taxes (IHT), a bugbear for potential Tory voters, also are delivering for the Exchequer at £3.2billion in the April-August period, some £300million up on the comparable period of 2023. 

IHT is often not very high on the agenda of most ordinary citizens unless they are staring their maker in the eye.

It is also one of those taxes which may not be on the radar of younger Britons as they wrestle with student loans, climbing the housing ladder and all the struggles which are seen as stirring inter-generational conflict. 

This is a nonsense. The immediate offspring of the baby boomers and their grandchildren should pay close attention.

Many worry about what has become known in the US as SKI-ing, Spending the Kids Inheritance, but they might be wiser to focus on IHT. 

The accidental wealth accumulated in the residential housing market, together with some handsome pension pots, has driven a whole new cohort into inheritance tax brackets.

Indeed, in spite of all the moans about inter-generational unfairness, many offspring and grandchildren are already benefiting from accidental wealth through the established route of the bank of Mum and Dad or ‘educational’ assistance out of income.

Nevertheless, as the grim reaper arrives for the boomers, the prospect of HMRC grabbing the family nest-egg ought to be as of much concern to younger voters as the silver surfers. That is why an end to IHT or bigger reliefs could be such a vote winner.

Simon says

Profit upgrades at Next are a feature of Simon Wolfson’s cautious style of management. So the latest raised profits guidance, from £845million to £875million is not a surprise.

It also shows that in spite of the Wilko debacle, Britons are still defying the cost of living crisis and scanning their debit and credit cards.

As interesting is Wolfson’s clear-headed take on supply chains. His analysis shows that the impact of the great inflation is fading fast. Other FTSE firms, which prioritise PR guff, could learn.

The performance of companies as diverse as Apple, Britain’s world-leading advertising group WPP and broadcaster ITV might not appear to have anything in common.

Nevertheless, disappointing financial results from all of these businesses have a common cause.

Economists monitor all kinds of data in seeking to project where national and global output is going.

Freight rates, credit and debit card activity, and cranes across urban landscapes (a favourite of the late chancellor Nigel Lawson) are all followed by analysts as a means of getting a jump on the competition. These are especially powerful tools for investment banks, hedge funds and other traders.

Among the unsung indicators are the promotional budgets of the corporate world.

So far, in spite of the Bank of England’s gloomy forecasts, knocking consumption and business investment on the head has proved harder than the interest rate-setting Monetary Policy Committee might care to admit.

Latest data shows booming car registrations with a 25 per cent uplift in July 2023 from a year ago and the 12th consecutive rise. That almost parallels the Bank of England’s 14-month tightening cycle. Admittedly, there may be special factors such as the 2030 target for going electric. Nevertheless, the data is far from meaningless.

The headlines tell us that higher interest rates are causing pain and will monster housing and construction.

Yet the Bank’s own mortgage approval data and home loans figures ticked up in June. The construction Purchasing Managers’ Index also jumped in the same month and is now out of recession territory.

An underrated indicator is advertising. As someone who started his career at J Walter Thompson, now embedded in WPP, and has gone on to spend several decades on national newspapers, I could not but be aware of how advertising provides clues to corporate jitters. Most marketing directors would testify that when there are worries in the executive suite about the future, promotional and advertising budgets are the first to be cut. Technology has made that crude assessment more complicated now that media buying is likely to be handled by an algorithm and made ever more volatile by AI.

Yet the stories from WPP, Martin Sorrell’s S4 Capital and ITV are more or less the same. In July, S4 Capital, which does digital advertising, warned that second-quarter income was hammering the commercial spend of clients such as Facebook and Google and, one dare say, Apple.

WPP tells the same story. Shares plummeted 3.5 per cent in trading yesterday as the company downgraded its prospects because of lower spending by tech customers. Clients are much more cautious about promotional spend.

Fearful of declines in traditional (now called linear) advertising, ITV, which in the UK still has the luxury of being able to reach mass audiences, also recently reported disappointing commercial data.

In the light of what may prove to be a secular decline, it has been active in seeking new sources of income, from streaming subscriptions to studio production. So what should we make of all of this? It is not entirely encouraging, in spite of recent bumper results from a range of FTSE 100 companies, which have used the post-Covid era to widen profit margins. It would suggest that the very biggest global companies have been dealt a psychological, if not much of a financial, blow from the aggressive round of interest rate increases on both sides of the Atlantic and further afield.

There is a real possibility than advertisers have pushed the pause button too soon and a global recession is averted.

In the US, there is much talk of a ‘soft landing’ – a slowdown which does not cause recession. Given the amount of fiscal stimulus undertaken by the Biden Administration, that would not be that surprising.

After the Bank of England’s fire and brimstone talk about wage pressure and the need to come down hard on inflation at Thursday’s interest rate meeting, there are first hints that it may soon be possible to ease off the brakes in the UK.

Chief economist Huw Pill said policy actions so far ‘are working in pursuit of target’. Advertisers may have cut and run too soon. If the US, Britain and others can get through this year without a recession, the marketing departments might be allowed to turn the spending taps back on and secure new sales.