| Thursday, February 08, 2007 |
| Net income of Murdoch's News Corporation drops |
News Corporation, the media conglomerate controlled by media baron Rupert Murdoch, has reported lower net income for its second fiscal quarter of 2006, compared with the results a year ago.
The company, which owns MySpace, Twentieth Century Fox and the Fox News Channel, earned US $822 million in the three months ended in December 2006, down from US $1.08 billion a year ago, when it had a one-time gain from selling an educational publishing business.
Without that gain of $381 million, the earnings of the previous would have been $694 million. On that basis, earnings from continuing operations rose by18% in the latest quarter from a year ago.
While earnings from movies at the box office and home video jumped by 57%, television earnings dropped by 39% on weaker ratings for post-season baseball on Fox and losses related to the launch of MyNetworkTV, a mini-network on Fox stations.
Rupert Murdoch said the company was "disappointed" with the results at MyNetworkTV, where ratings have been "far below expectations."
He said new management has been brought in and will introduce new programming.
MyNetworkTV has stumbled since its launch with a strategy of relying heavily on prime-time soap operas. Peter Chernin, News Corporation's chief operating officer, said the network would move the ‘telenovela'-style soap operas to two nights a week, add a martial arts fighting show and show movies on Thursdays and Fridays.
Revenue from Fox Interactive Media rose to $125 million in the quarter, mainly from gains at MySpace, where revenue rose by over $50 million.
MySpace, the largest social networking site on the internet, is poised to earn good revenue in fiscal 2007, with profitability increasing dramatically in the following year, Peter Chernin said.
Much of MySpace's future growth is expected to be driven by an advertising deal with online search leader Google Incorporated, which has promised to share $900 million in revenue with the social networking site in the next three years.
The Wall Street Journal reported on Wednesday that the six-month-old deal still has not been finalised because of tensions raised by MySpace's talks with EBay Inc. to tap into the online auctioneer's technology and online payment system. Doing so could make it easier for MySpace's users to buy and sell items from each other.
A MySpace partnership with EBay may hit Google's own efforts to build its own merchandise listing service and payment system.
However, Chernin has said MySpace remains "absolutely comfortable" with the Google deal.
Murdoch said the company was close to announcing its long-awaited plans to launch a business news cable channel as a rival to CNBC, which is owned by General Electric Company's NBC Universal.
News Corporation's revenue during the quarter rose by 18% to $7.84 billion from $6.67 billion.
Movie and TV production earnings climbed by 57% to $470 million.
Cable network programming profits rose by 5% on more gains from the Fox News Channel, and profits from newspapers more than doubled to $170 million from $69 million a year ago.Labels: media |
| posted by a correspondent @ 11:10 PM |
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