Rupert Murdoch has acknowledged publicly for the first time that his son James is not the preferred choice to succeed him as News Corp chief executive.
In the clearest indication yet that the phone hacking scandal enveloping News Corp's UK operations has damaged the succession ambitions of James Murdoch, his father endorsed chief operating officer Chase Carey for the job.
"Chase is my partner and if anything happened to me I'm sure he'll get it immediately - if I went under a bus," the elder Mr Murdoch said in response to a question from a reporter about succession on the company's quarterly earnings call.
Although News Corp has often said that it has a succession plan in place, the company has never explicitly stated who would take the chief executive role should Mr Murdoch step down.
In testimony before the House of Commons last month, Mr Murdoch reiterated his long-held desire to see one of his children succeed him.
Until recently, his youngest son, James (38), had been viewed as the likely successor after he was promoted to deputy chief operating officer in March. However, he has been under pressure since the phone hacking scandal, which erupted last month at News Corp's UK operations, forced the closure of its News of the World and the arrest of 12 ex-staffers.
News Corp's UK business ultimately reported to James Murdoch.
James Murdoch has to submit a written statement to a British parliamentary committee today responding to accusations that he misrepresented statements in prior testimony.
Mr Murdoch (80) said last night that he and Mr Carey had "full confidence" in James, leaving the door open for him to possibly become chief executive in the future.
In the meantime, Rupert Murdoch has no immediate plan to step aside despite the phone hacking scandal raising questions about his leadership. "I hope the job won't be open in the near future," he joked. He added that he has the full support of News Corp's board.
Mr Murdoch's comments came during a quarterly earnings call in which he was more lucid about the company's operations and more combative towards inquisitors than he was last month. He forcefully denied allegations that News Corp's board was beholden to him rather than to shareholders and sought to drive home the notion that its independent directors were just that.
Mr Murdoch also beat back calls from analysts about selling or spinning off the company's newspaper operations.
In addition to newspapers such as the Wall Street Journal, New York Post and the Sun, News Corp also owns the Fox broadcast network, a stable of cable channels, the 20th Century Fox film studio and a host of other assets across the globe.
Mr Murdoch once again expressed his regret about the phone hacking revelations. He also said that he was disappointed that the scandal forced the company to drop its bid for full control of UK satellite TV company BSkyB.
News Corp reported a profit from continuing operations of $982 million, up from $902 million a year ago.
Its net income fell to $683 million, or 26 cents a share, down from $875 million, or 33 cents a share, a year ago after recording a $254 million loss on the disposition of its troubled social networking Myspace.
Reuters