It's a Family Affair

Malone has his legacy concerns too, which are what touched off this skirmish a few weeks ago. Long regarded as the consummate cable executive, he has built Liberty Media through relentless wheeling and dealing into a virtual mutual fund of cable interests, including QVC, the Encore and Starz! movie networks, stakes in Discovery Communications, Court TV, game-show channel GSN, DMX Music, MacNeil/Lehrer Productions and others. Yet Malone has been unable to add value to this portfolio; the stock has gone nowhere in years and, at around $10, represents a hefty discount to Liberty's assets. Liberty didn't respond to an interview request. But Malone is thought to be trying to pressure Murdoch into buying some of his cable assets in order to raise cash and start fresh.

At least Liberty shareholders would enjoy that ride. News shareholders might do well too--but it's family control that is foremost in everyone's mind. This isn't unusual in the media world, where companies like Viacom, the New York Times, Comcast and the Washington Post are controlled by families through a special class of voting stock. In all these cases, argues analyst Richard Bilotti at Morgan Stanley, the day of reckoning may be approaching. The businesses have become much more complex, especially at global empires like News and Viacom. If any start to run their business dispassionately, with an outsider as the leader and solely for profits--and succeedthey will "pressure everyone else to play by the same rules." But for now, anyway, it's all about family.