• by David Goetzl  @dgoetzl, February 23, 2009

On a recent investor call, News Corp. CEO Rupert Murdoch indicated that the company had every intention of re-signing COO Peter Chernin. But in a surprising development, Chernin--who oversees properties ranging from the Fox network to MySpace--is leaving the company, according to a company statement. 

News Corp. is not expected to replace the executive. The soon-to-be-78-year-old Murdoch is taking over much of Chernin's West Coast-based responsibilities, which also include the 20th Century Fox film studio.

Chernin's departure could significantly affect News Corp.'s standing on Wall Street--the company's share price dropped 4% Monday--since the executive is regarded as a sort of rudder. In strong remarks before a recent gathering of advertisers, Sanford Bernstein analyst Michael Nathanson said investors have soured on both Viacom and News Corp., since Sumner Redstone and Murdoch (and their families) respectively hold such rock-solid control.

Wall Street has concluded, Nathanson said: "I don't want to own these companies because I can't stand the people who own these companies." He cited investors feeling as if they hold no sway over major decisions. In News Corp.'s case, he cited its acquisition of The Wall Street Journal as something investors may have opposed, but felt they had no power to block.

The voluble and persuasive Chernin's contract is up in June. He is also a member of News Corp.'s board of directors, and has been COO for 12 years.

Chernin is understood to have spearheaded many of News Corp.'s forays into new media recently, including joining with NBC Universal to form online video hub Hulu and working to expand MySpace, which now faces heightened competition from Facebook.

A Los Angeles Times story said his departure was finalized over the weekend. Chernin has been mentioned as a possible CEO candidate at companies such as Yahoo and--before Bob Iger took over--at Walt Disney.

After Chernin--a former book editor and Showtime executive--steps down from the COO post, his contract calls for him to become a producer at the Fox division.

Rupert Murdoch is known to want one of his children to follow in his footsteps as CEO, with one perhaps serving as a COO under him before his retirement. James Murdoch, chairman-CEO, Europe and Asia, is believed to be the eventual successor. He and his brother Lachlan are on the company board.

This story has been updated.