Murdoch Morose About US Economy - and TV Revenues

12 March 2008

PALM BEACH, Florida: Nothing if not a realist, the patriarch of Clan Murdoch admitted his gloom about the US economy to a Bear Stearns media conference earlier this week. "In the last month," he told the assembled moneymen, he had become "a lot more pessimistic" about the US economy.

No stranger to candour, Rupert Murdoch is the first of American media's big beasts to publicly admit that the subprime earthquake has triggered secondary tremors across the US market as a whole.

Ad revenues across the Fox TV Network were "about 5% behind what we'd hoped for". But the rest of News Corporation, claimed its chairman/ceo, had experienced no adverse impact on trading. Most likely because the group has lessened its reliance on advertising to 23% of total revenues.

Despite which Murdoch claims to see a healthy future for network television, insisting that major fmcg marketers "still want mass audiences" that are lured by sport and entertainment programming. 

However, his frankness amid a mob of moneymen did nothing for NewsCorp's stock price, which slipped 1.88% to $18.28 by the close of trading.

  • As to NewsCorp's possible interest in donning a white knight's armour and galloping to rescue Yahoo from the Microsoft dragon, the mogul downplayed his possible intervention. 

    He declined to "get into a fight with Microsoft over Yahoo" since the software titan "has a lot more money than us".

    Moreover, he has no incentive to alienate Google. Quite the reverse.

    "We're very happy to be in the Google camp" said Murdoch. "They sell our search advertising, and pay us well for it," he said.

    Thereby signalling that he is disinclined to foul his own backyard. But in archetypal Murdochian style his options remain open.

  • Data sourced from The Times (UK); additional content by WARC staff