Rupert Murdoch: Worst over; MySpace exec changes will regain momentum

News Corp. chief Rupert Murdoch says it "is increasingly clear that the worst is over" for the economy (and ad market).
Written by Larry Dignan, Contributor

News Corp. chief Rupert Murdoch says it "is increasingly clear that the worst is over" for the economy (and ad market). Meanwhile, Murdoch said that the executive changes at MySpace will restore the site's momentum, make the site "more attractive" and deliver more ad friendly inventory. 

Murdoch---speaking on a conference call with analysts following the company's fiscal third quarter earnings report (Techmeme)--gave his economic assessment:

"I'm not an economist, but it is increasingly clear that the worst is over," said Murdoch, noting he was at the forefront of the pessimism parade. "There are emerging signs that the days of precipitous decline are done." 

He added that the beginning of the quarter looked terrible, but has picked up in recent weeks. 

Murdoch also talked up the company's recent management changes at MySpace. He indicated that the "moves in last two weeks will help it regain momentum" and take it to "a much higher plane of growth."

Murdoch---along with Jonathan Miller, News Corp.'s digital chief---named Owen Van Natta MySpace CEO last month. Van Natta had been chief revenue officer at Facebook. Van Natta replaced Chris DeWolfe, who agreed to step down.

Van Natta's job: Juice MySpace's growth and profitability. Murdoch said MySpace now has the "right people in place to develop new features and products to spur the profitability that has completely escaped our rivals."

News Corp.'s "other" segment, which includes MySpace parent Fox Interactive Media, reported a third quarter operating loss of $89 million, down $82 million from a year ago. 

The company said:

The decline in FIM operating results was driven by lower advertising revenues combined with increased costs associated with the MySpace music joint venture and the launch of new features.

Specifically, FIM ad revenue was down 16 percent in the quarter. Executives noted that there will be more costs coming out of FIM. Murdoch said that Miller will be making MySpace "a much more attractive site" that won't be chasing Facebook for users that can't be monetized. Murdoch added:

"We're not going for the Facebook model of getting hundreds and hundreds of millions of people who don't bring any advertising with them at all."

Luckily the rest of the company is a cash cow. News Corp. reported net income of $2.7 billion, flat with a year ago. Revenue, however was $7.37 billion, down from $8.75 billion a year ago.

Editorial standards