Jack Schaffer at Slate has come up with one of the truly coolest ideas I’ve heard in weeks. Rupert Murdoch, Schaffer points out, is going to buy the Wall Street Journal. To thwart him, Schaffer suggests that the Financial Times just buy the Journal’s best reporters (link).
As satisfying as dynamiting Journal headquarters just as Murdoch arrives to take custody might be, I recommend a subtler strategy of creative destruction. The peach-colored Financial Times, one of the Wall Street Journal's competitors, should raid the Journal and in one swoop steal 100 of its best reporters and editors.
If poaching of a few of the Wall Street Journal's 700 reporters and editors by Condé Nast's Portfolio is considered news, imagine the stir the pillaging of the Journal newsroom by the FT would create. Grand talent raids are common in the law biz, where ambitious firms cripple competitors by looting, say, an entire tax division, and having the defectors bring their clients with them.
The London-based FT moves about 140,000 copies a day in the
If you estimate an average head-count cost of $200,000-$250,000 for each purloined Journalist, the FT would be adding $25 million or so to its editorial budget. That looks like a lot, but it's far from the $5 billion Murdoch has bid for all of Dow Jones. Of course, many of the Journal's most talented will be booking departures upon the arrival of Rupert Murdoch. But if a great mass of them left at the same time for the FT, the raid could cut into Journal circulation. I imagine the FT placing full-page ads in the New York Times business section like this:
Do you miss reading Wall Street Journal All-Stars David Wessel, Walt Mossberg, Amy Marcus, Greg Ip, John Harwood, and Monica Langley? They—and others—have found a new home at the Financial Times. Why don't you join them?
I love it. Seems to me that Murdoch is after two things at the Journal. One, the brand. He wants to slap the Journal’s good name on any kind of crap product he can think of until it loses all value. The other is the stable of talent which, as any conscientious reader must concede, is one of the wonders of the modern world.
Profiting from the talent of others is a familiar strategy. Setting aside the obvious issue of outright slavery—one of the reasons you wanted to be Landgrave Hess-Kassell in the 18th Century was so you could rent out your troops—call them “Hessians”—to fight in (and, as it happens, to lose) somebody else’s war.
It may come as news to Rupert Murdoch that the likes of John Harwood and Greg Ip are not Hessians whose services are to be bought and sold at wholesale. No, wait a minute, perhaps they are: I wonder how many of these guys signed contracts including a “covenant not to compete”—a promise that they wouldn’t go to work for the competition.
Courts have always felt dicey about covenants not to compete. On the one hand, if I raise you up and give you a platform to develop your talent (along with a bunch of great sales leads) it doesn’t seem fair that you should be able to cross the street and set up shop against me. But on the other hand, if the court says: you can’t work for anybody in the world except Rupert—why then, the chances are you wind up working for Rupert.
Which makes you look an awful lot like a Hessian, which is probably what Rupert (who is usually one or two steps ahead of me) has in mind. I suppose if the FT is going to take Shafer’s advice, they better wait until the ink is dry or they will just queer the deal. In the meantime, they might want to bone up on the law of covenants not to compete. But I hope they do it. And I hope they win.
Bona Fide Teaser: Although all my friends tell me I should get with the program, I admit have not yet bought a subscription to the FT. Yes, I believe it has shot up amazingly in terms of quality and is now a much better imitation of The Economist weekly than is The Economist itself. So here’s my deal: FT hires Harwood and Ip, I’ll cough up for a subscription to the FT. There, that ought to settle things.
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