Truth will out. After months of rumour and speculation, the pieces of the puzzle as to what exactly has been going on behind the scenes at Rupert Murdoch’s Asian arm are falling in place (or so we believe).
Conversations Indiantelevision.com has had with industry executives in India and Hong Kong aver that the countdown to yesterday’s announcement of Star CEO Michelle Guthrie’s departure had been set in motion months before. The first inklings of that came with the creation last March of a new executive structure within Star wherein Steve Askew was named president of Star Entertainment in addition to COO of Star; and the appointment less than a month later, of Paul Aiello as president of Star.
Aiello’s was a newly created role that put him in charge of developing strategic and business directions for the pan Asian broadcaster while overseeing corporate functions including business development, strategy and implementation, Star Ventures, government affairs and corporate communications.
Similarly, the schism that has riven Star India these past months also directly links back to events of March 2006 and the shake up in the Indian operations wherein two units were created – Star Group and Star Entertainment – with Peter Mukerjea made CEO of Star Group India and Sameer Nair promoted from COO Star India to CEO of Star Entertainment India. More on that later though.
Back in Hong Kong, meanwhile, the next significant appointment was in September of David Butorac as president, Platforms. That announcement marked the return to the News Corp fold of a BSkyB veteran who was then COO of Malaysia’s Astro DTH operator.
All these moves are said to have been orchestrated out of London by BSkyB CEO and now looking ever more likely heir to the Murdoch legacy, James Murdoch. That James would have a personal interest in the affairs of Star is not surprising since his three-year stint as chairman and CEO of Star marked his coming of age as an entrepreneur.
When James joined Star in May 2000, Star was losing ?100 million a year. When he handed over charge to Guthrie in November 2003 Star’s India operations were extremely profitable and China was beginning to show profitability. Guthrie’s mandate was to drive the company further into these markets and steer it into DTH, and pure pay TV plays with higher subscription revenues.
In both China (due to political reasons as much as anything) and India (the cycle of change?) there has been a deceleration but that doesn’t really tell the story. One could argue that it is also down to the advantages of being an owner but there is no getting away from the fact that during James’ reign there was clarity and simplicity in both executive chains of command as well as corporate structure and direction.
To say that the executive command structure at Star today is convoluted would be putting it kindly. And nothing exemplifies this better than the India operations where there is a strategic/corporate CEO in Mukerjea, an operational CEO in Nair, and a president in Paritosh Joshi responsible for managing revenues. And there soon may even be a COO if reports of a move to India of long time Star Hong Kong hand Sanjay Das pan out as true. We’re surprised that the name of long-time Star loyalist and former India business development head Jagdish Kumar has not cropped up anywhere in the speculations.
According to our reading of the events of the past few months, James has been preparing the ground for a return to the lean, mean management style that was in place earlier and this could more than likely see more executive churn right through the Star system. At the top of that list of potential near term departures is Askew, currently on four months’ sick leave.
A possible offshoot of this could be that James will sooner rather than later have a far more role in running the affairs of Star, maybe take on a designation of chairman of Star or some such.direct
And truth is that Star really means India, the rest of it being not much more than feeder operations. So James will perforce have to send out a clear message there. The present neither here nor there two-CEO proposition has proved an unmitigated disaster.
If the head honchos at Star were convinced that Nair was the man to lead it into the new and uncertain digital future then they should have gone with him and let him do his job. The presence of a shadow CEO (Mukerjea) was a huge disservice to Nair and even more so to Mukerjea, who had helmed the fortunes of Star India in its period of greatest dominance.
POSTSCRIPT: The reasons for Nair’s deciding to quit (informed sources say he put in his papers on 28 December) remain shrouded in mystery because his is after all the most high profile media chief executive’s job in the country (shadow CEO notwithstanding). If anyone could be said to have had reasons to quit it was Mukerjea, and by current reckonings, both have resigned. So there is certainly some serious damage control that newly inducted CEO Aiello has to deal with when he arrives in India on Monday.
