News Corporation's Australian division began purging its middle management staff Wednesday (May 29), a week after it signed a deal with OpenAI, which allowed the artificial intelligence (AI) startup to access its news content.
Several sources told The Guardian that News.com.au editor-in-chief Lisa Muxworthy and Editorial Innovation Center group director John McGourty were two of the most senior staff shown the door.
Peter Blunden, one of the last senior News Corp executives who has been influential due to his proximity with retired boss Rupert Murdoch, has been relegated to a part-time advisory role but would also retain his seat on News Corp's board.
The Sydney Morning Herald reported that Mick Caroll, a 20-year News Corp veteran, would replace Muxworthy, while Herald Sun editor Sam Weir, News in Queensland managing director Jason Scott, and Daily Telegraph editor Ben English would take on more responsibilities.
On the other hand, The Australian's editor-in-chief, Michelle Gunn, would retain her post but also assume editorial roles for Vogue and other Conde Nast publications.
Meanwhile, sources told Crikey that the reshuffling of News.com.au's managerial staff made several people working for the website visibly upset and expressed "rage" over the decision.
News Corp's Middle Management Purge
The sacking of News Corp's Australian news site was a surprise, as it is the country's most popular news website, with 12 million readers, compared with The Australian's 3.5 million.
However, the restructuring was not expected to result in mass redundancies among its journalists; instead, it was expected to target middle management to centralize its news-gathering process.
The job cuts resulted from a downturn in advertising and social media revenue, which was coupled with Meta's announcement that it would not renew its three-year content deal.
Staff were also briefed about the changes in a series of meetings Wednesday before a town hall meeting later in the afternoon.
Meanwhile, the Media Arts and Entertainment Alliance said that News Corp Australia's unionized journalists have also agreed to accept a 12-month extension of their enterprise bargaining agreement, with a pay rise of 3.5%, in exchange for a cap on redundancy payouts of AU$399,500 ($265,851.27). The decision was also made before the corporate announcement, but all News Corp journalists would vote on the agreement, whether unionized or not.
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