Yikes... Murdoch wants The Wall Street Jounal

I wish to direct this entry to the shareholders and directors of General Electric and anyone who is interested in historical comparisons. Right now, it should be noted that the management of General Electric has very luckily dodged a very big bullet in the fact that the Bancroft family has rejected the $60 per share offer from NewsCorp. However, I fear that Murdoch will raise its price until it gets Dow Jones, which should frighten everyone in GE. The mere fact that NewsCorp will own Dow Jones and use Dow Jones' financial reporting skills to compete with CNBC's dominance in global finance is the sole and best reason for GE to make a move and buy out Dow Jones to ensure that no one else can have it.

If the management team of GE or any of their directors is reading this entry, I strongly urge you to consider raising a $72 per share bid for Dow Jones. You have a fundamental duty to protect your interests, in this case the dominance of CNBC in financial broadcast journalism. I admit seeing Murdoch's offer of $60 per share for Dow Jones is jaw dropping and, frankly, it is nothing short of a brilliant move on his part. Unfortunately that does not change the bottomline, the partnership between CNBC and Dow Jones is much too valuable for GE to dismiss, much less let it slip into the hands of the competition. Murdoch and its Fox News division have never made much a secret that it wishes to launch a business news channel to compete with CNBC. Given Fox News track record, it will undoubtedly take whatever steps necessary to succeed. The acquisition of Dow Jones will only boost its success.

The second compelling reason for GE to offer a 20% premium on top of NewsCorp's $60 per share bid comes from the lesson of a critical World War Two naval battle off the island of Midway. The Japanese admirals knew that there could be no security if there was an enemy aircraft carrier in the neighborhood. However, Vice Admiral Nagumo of the Japanese Carrier Fleet believed in getting attacking in one big mass attack, which took time to get organized, instead of attacking it with what he had got. Like Nagumo, GE does not have the time to get organized before making a bid. Otherwise, Jeff Immelt will be sitting on his bridge watching his preverbal ships reduced to a blazing bulk, in a similar fashion to Nagumo. Right now, Jeff Immelt could be, in this situation, US Rear Admiral Raymond Spruance, the man credited with winning the Battle of Midway leaving Mordoch to play the role of Nagumo.

Ultimately, GE's interest in Dow Jones should extend beyond protecting its current asset, namely CNBC. What I see GE benefiting from by buying Dow Jones is NBC Universal's ability to have a global news audience and expand its coverage in print, in broadcast and on the Web. Furthermore, it would represent a huge blow to Fox Business, which is a boon for CNBC.