Rupert Murdoch's younger son James is to return to News Corp. to head its 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 broadcasting, print and Internet divisions including Hong Kong-based Star TV, Britain's Sun newspaper and Sky Italia.
He will rejoin the News Corp. board and step down as chief executive of Britain's pay-TV firm BSkyB, but remain with BSkyB as non-executive chairman, replacing his 76-year-old father
Rupert. BSkyB Finance Director Jeremy Darroch will become CEO.
The announcement from News Corp. on Friday is part of a wider shake up the media empire which spans newspapers, film studios, television networks and Internet properties such as MySpace.
James Murdoch, who served on the News Corp. board from 2000 to 2003, will report to Peter Chernin, News Corp.'s president and chief operating officer. He will be based in London, taking up his role immediately.
Les Hinton, executive chairman of News Corp.'s UK newspaper group News International, is to become chief executive of Dow Jones, taking up the position when News Corp.'s acquisition of Dow is completed next week.
Rupert Murdoch will step down as chairman of BSkyB and from its board. He became a director of the company in 1990 and has served as chairman since 1999. Shares in BSkyB were down 2.8 percent.
"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."
The reshuffle, which confirms what a source earlier told Reuters, appears to address the long-term speculation of who will eventually take over the media and communications conglomerate from the 76-year-old media mogul.
Rupert Murdoch's older son Lachlan, 36, had initially been seen as the leading contender during his time at News Corp. but he left the group in 2005 to start a new venture.
"This is grooming James for a larger role longer term 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 Sky in November 2003 and has expanded the company from its pay-TV roots to add broadband and telephony services. News Corp. owns 39 percent of the company.
But like his father, he has proved 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 percent stake in Britain's biggest free-to-air commercial broadcaster ITV.
Murdoch 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 -- and the deal is still being investigated by the UK Competition Commission.
He has also proved provocative -- accusing once-revered public broadcaster the BBC of having the aspirations of a megalomaniac -- but surprised many with his insistence on making the company carbon neutral.
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.
London analysts said James Murdoch had proved to be a strong leader after some initial skepticism and said the company would benefit from his ongoing involvement. They also welcomed Darroch's appointment.