DirecTV CEO departs for News Corp.
(AP) – The president and chief executive of DirecTV Group Inc. said Wednesday that he's resigning to return to News Corp. as Rupert Murdoch's second in command, a shake-up that seems to preserve the family succession line at News Corp. but leaves a big vacuum at the satellite TV provider.
Chase Carey, 55, will join News Corp. on July 1 as deputy chairman, president and chief operating officer with oversight of all of News Corp.'s global operations. He steps into an executive gap left by Peter Chernin, News Corp.'s president and COO, who leaves on June 30 to embark on a lucrative movie production deal with News' 20th Century Fox studio.
Murdoch calls Carey "one of my closest advisers and friends for years," and that he is "delighted we'll once again be working together across our businesses as we face the challenges and great opportunities ahead."
Carey leaves DirecTV as the company is in the midst of merging with Liberty Media Corp.'s entertainment unit, which will be spun off into a new, publicly traded company this year. John Malone, DirecTV's chairman, said he's confident that the company's experienced executive team will manage without Carey.
But Standard & Poor's analyst Tuna Amobi isn't so sure. "Having led DirecTV for the past six years to strong competitive footing, marked by major operating and financial accomplishments, Carey's exit could leave a hard-to-fill vacuum," he said in a research note.
Carey has presided over the growth of DirecTV from 12 million to 18 million subscribers. He was in charge as DirecTV grew free cash flow from breakeven in 2003 to $1.7 billion in 2008.
Under his leadership, DirecTV ramped up its high-definition TV offerings and focused on customers with better credit who wouldn't mind paying more for quality television.
Carey also oversaw the turnaround of Latin American operations after bankruptcy. It has nearly quadrupled its subscriber ranks, to 5.8 million.
It's unclear how Carey was able to exit his employment contract with DirecTV, which runs until the end of 2010. His compensation at News Corp. hasn't yet been determined, according to a filing with the Securities and Exchange Commission.
Carey spent 15 years at News Corp., including as co-COO, before he left to take the helm at DirecTV in 2003. He also was an executive at News Corp.'s Fox Entertainment Group. He presided over the launch of Fox Sports and creation of Fox News Channel, among others.
James Murdoch, 36, Murdoch's fourth child, will report to Carey as he had reported to Chernin after being promoted to the post of chief executive of News Corp. in Asia and Europe in December 2007.
James Murdoch is still expected to succeed to the top post when his 78-year-old father leaves the position.