There are concerns among business and media executives in Asia about the business track record of Michelle Guthrie, who is set to be appointed as the new managing director of the Australian Broadcasting Corporation. She has twice resigned from major positions in the past decade and has little direct experience in content.
Charming and personable, 50-year-old Guthrie’s main skills are seen as managing relationships — particularly those of her superiors, rather than at an operational level — and her career-long links to the Murdoch family.
People who have met her on a handful of occasions describe her as “impressive” or “very bright”, with a reasonably good reputation, but some who have followed her career closely voiced concerns about her substantive achievements.
She has also, people who know her say, retained a fascination for the Murdoch family, for whom she worked at Foxtel in Australia, BSkyB in the UK and Star TV in Hong Kong before unexpectedly resigning from the business in 2007.
If handed the job over more experienced media operatives such as former News Corp and Foxtel chief Kim Williams (who has spent far less time working for the Murdochs than she has), her appointment will raise two key questions: will the ABC now separate the jobs of managing director and editor-in-chief as recommended by Malcolm Turnbull last year? And, perhaps more importantly, is the appointment of a person who has spent the past four years looking after relationships with advertisers at Google a prelude to at least a partial commercialisation of the assets of the ABC?
Guthrie’s rise to prominence in media circles came when she was handpicked by James Murdoch for the role of business development chief at Star TV, News Corp’s Asian pay TV arm, a position in which she became one of News Corp’s most highly placed female executives. It was the result of nine years working for the Murdochs, mainly as an in-house legal counsel; first at BSkyB in the UK (under legendarily hard-nosed Australian media executive Sam Chisholm), then at Foxtel in Australia (where she had completed her arts/law degree at Sydney University) and eventually at Star, where she graduated from the legal office into business development after two years as its chief beak, before replacing James Murdoch as CEO in 2003.
At the time Rupert Murdoch said: “With her business acumen, sharp sense for new opportunities, her strong ability to run diverse operations and enthusiasm for the television business, I am confident that she will take Star’s business to the next level of growth and profitability.”
Yet she did not. By the time she departed four years later, people familiar with the business at the time said, it was losing money. Star Group struggled to make inroads into China, a source of some frustration for Rupert Murdoch, which he took out on Chinese authorities. Star Group’s Indian operation, where it made most of its revenue, also suffered a downturn. For the financial year ending June 2007, Guthrie’s last at the company, its income dropped 30%, year-on-year, to $91 million.
Guthrie’s own handpicked No. 2, former Morgan Stanley investment banker Paul Aiello, succeeded her but fared little better, lasting just two years in the chief executive role. After he departed in 2009, the company was radically restructured and cut 30% of its staff.
Just six weeks after leaving Star to “take a break”, Guthrie was named as managing director of leading US private equity firm Providence Equity Partners’ Asia office in Hong Kong, which specialised in telecoms and media, and engaged Guthrie at a time when most North American and European private equity firms were scrambling to set up Asian headquarters. Despite often being named as a bidder on major buyout deals, PEP was never successful in a significant buyout during Guthrie’s four-year tenure.
Yet in 2008, PEP was reported to be close to buying out James Packer’s listed Consolidated Media Holdings in a consortium with Packer’s private company Consolidated Press and Lachlan Murdoch’s then-nascent Ilyria for a mooted $3.3 billion. PEP and Murdoch ultimately baulked at Packer’s asking price and walked away — a decision that was, in retrospect, wise. It demonstrated once again Guthrie’s close links to the Murdochs.
As managing director for Google’s business partner relationships in Asia Pacific from 2011, and of its advertising relationships since April last year, she has only been in the second string of the company, which has no profit and loss accountability. While many have hailed her digital media experience gained form her time at Google, her roles did not give her formal oversight or responsibility for the company’s products.
Those who have worked with Guthrie are quick to point out that she has no direct content or editorial experience, in marked contrast to current ABC managing director Mark Scott. But the ABC has the ability to adjust to deal with this, should she be appointed its leader.
It was recommended last year that the ABC split its managing director role, one undertaken with various amounts of enthusiasm by the public broadcaster’s chiefs in recent decades, from its editor-in-chief role.
Critics of the ABC have often accused Scott of not taking enough responsibility for the ABC’s content, which has made the split popular with some within the Coalition government. But Scott has often argued against the split, saying that while he cannot personally vet the ABC’s copious content, there is a benefit in making the head of the organisation ultimately responsible for it.
Malcolm Turnbull argued for the split when he was communications minister. “It creates the impression that the managing director is directly in charge of ABC news and current affairs, which he is not, and given the wide range of his responsibilities, could not be,” Turnbull said last November. “The board should expect the head of news and current affairs, like the CFO, to report directly to the board as well as to the managing director thus enabling the board to discharge its statutory obligation.” The ABC declined to comment on the issue this morning.
Guthrie’s many years of experience with News Corp, as well as her continuing public admiration of the Murdoch family, make an interesting fit with the ABC, an organisation that Rupert Murdoch’s newspapers in Australia appear to view as their major competitor in digital and 24-hour news. How Guthrie responds to this will be fascinating.
Crikey attempted to get in touch with Guthrie through several channels this morning but did not hear back by deadline.
Correction: A previous version of the story said the recommendation to split the managing director and editor-in-chief roles at the ABC was made in the Lewis review. It was not — it came from then communications minister Malcolm Turnbull.
‘Charming and personable’ Tautological?
Apart from the pedantry, are the authors actually suggesting that Michelle Guthrie might be appointed and attempt to nobble the ABC to advantage Newscorp?
Your unsourced criticisms [Crikey’s standard modus operandi of course] suggest you could be worried about a competent person being appointed to the A.B.C. or anywhere else for that matter, which is not of course news except of course as stale news.
We can be sure you’ll maintain that standard, can’t we.
This is yet another balls-up by this government, if this appointment goes ahead. I know they are not directly involved in the appointment, but they do appoint the board members!
NOBODY who has had ANYTHING to do with Ltd News or the Murdochs should be allowed anywhere near the ABC.
And yes Archie, that is exactly what the government and ABC board would do.
Get ready for balance to disappear and right-wing BS to become standard fare on ‘your ABC’ (Well more than it is now)!.
Bloody outrageous!!
Sorry…that should read “…should not be allowed anywhere near the ABC”.
All people appointed to any govt board should be put on notice by Labour that on change of Govt they are out the door,the minister should tell them before they accept they must write a resignation letter signed but not dated to he used in those circumstances .