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Murdoch begins coronation drill

London, Dec. 7 (Reuters): Rupert Murdoch’s younger son James will step down as chief executive of Britain’s BSkyB to head News Corp’s Asian and European operations, in a move that appears to make him heir apparent to the global media empire.

Murdoch, 34, will become chairman and chief executive of Europe and Asia at News Corporation, taking charge of its international broadcasting, print and Internet divisions from Asian satellite television operator STAR TV to Sky Italia.

He will remain at BSkyB as non-executive chairman, replacing his 76-year-old father Rupert, and will be replaced as chief executive by the group’s chief financial officer, Jeremy Darroch, the dominant British pay-TV firm said on Friday.

James Murdoch will rejoin the board of directors of News Corp, on which he served from 2000 to 2003, and report to Peter Chernin, News Corp president and chief operating officer.

He will be based in London, taking up his role immediately.

“James is a talented and proven executive,” his father Rupert said in a statement. “He has transformed Sky.”

“His experience at Sky, combined with his track record in Asia while running STAR, and prior roles, make him uniquely qualified to take forward these exciting businesses that have grown so much over the last decade.”

In a separate statement, News Corp said Les Hinton, executive chairman of its UK newspaper group News International, would become chief executive of Dow Jones, taking up the position when News Corp’s acquisition of Dow is completed next week.

“This is grooming James for a larger role at News Corp,” Pali Research analyst Richard Greenfield said.

“He has proved himself beyond a doubt over the last several years at BSkyB.” James Murdoch joined BSkyB in November 2003 and has expanded the company from its pay-TV roots to add broadband and telephony services.

But like his father, he has proved to be a risk-taker. He has also drawn the attention of regulators, leaving the group engaged in three separate investigations and a law suit with fierce rival Virgin Media.

His most audacious move came in November 2006, when he purchased a 17.9 per cent stake in Britain’s biggest free-to-air commercial broadcaster ITV.

Murdoch had said the purchase was a long-term investment but its rivals accused him of trying to prevent ITV from being bought by NTL — now renamed Virgin Media. The deal is still being investigated by the UK Competition Commission.

BSkyB said Darroch, who was previously with the Dixons Group and Procter & Gamble, had worked closely with James Murdoch in setting the company’s recent strategic direction.

Rupert Murdoch will step down as chairman of BSkyB and from the board. He became a director of the company in 1990 and has served as chairman since 1999. Shares of BSkyB were down 0.3 per cent during mid-day trading.

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