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UPDATED 6:51 p.m. PT Nov. 13, 2007
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News Corp. chairman and CEO Rupert Murdoch on Tuesday signaled more clearly than ever that his team likely will make the Wall Street Journal’s Web site free once the conglomerate closes its acquisition of Dow Jones next month and that this could bring in loads of new advertising money.
Also, News Corp. has seen a very strong first half of its fiscal second quarter after a better-than-expected first quarter, but it isn’t yet ready to boost its full-year growth guidance, Murdoch said at the conglomerate’s shareholder information meeting in Adelaide, Australia. The meeting comments were available worldwide via webcast.
News Corp. last week reported stronger-than-expected fiscal first-quarter results but reaffirmed its full-year fiscal guidance for low-teens percentage growth in operating profit, citing a tough economic outlook that could affect business (HR 11/8).
But Murdoch said Tuesday that his company hasn’t seen any negative effect on its advertising trends from current turbulence in financial markets. “We are running ahead of (guidance), but it is too early to change the guidance,” he said.
One example for News Corp.’s solid ad trends is the fact the company has pretty much finished selling ads for the Super Bowl, and the rates it has fetched for it are “quite phenomenal,” the mogul said.
Discussing News Corp.’s film unit, Murdoch said that “it’s looking extremely good” so far this fiscal year as well, even though the company had “budgeted to do a little less this year.”
In his presentation, Murdoch also suggested that a swap with John Malone’s Liberty Media could close by Christmas or soon thereafter, definitely within a few months. Meetings between News Corp. and the U.S. Department of Justice in recent days have been “very productive,” and Liberty had only some smaller problems in these talks, he signaled.
Murdoch spent some time Tuesday discussing the planned Dow Jones deal.
“We are studying, and we expect to make that free, and instead of having a million (paying subscribers), having at least 10 million-15 million in every corner of the Earth,” he said about the future of the Journal’s Web site. Murdoch suggested a free WSJ.com site could attract “very large sums or relatively large sums” of advertising money.
News Corp. has been widely expected to move to a free content model to boost traffic to the online Journal and focus on making more advertising revenue from it. However, management has repeatedly said that they are exploring options for the site and the financial impact of going free.
A senior Dow Jones executive told Editor & Publisher that it still was too early to say what should happen to the WSJ.com site and pointed out that Murdoch doesn’t own Dow Jones yet.
Meanwhile, Reuters reported Tuesday that bids for nine TV stations that News Corp. put on the auction block in the summer are due Friday. Sources have said that private-equity groups have looked at the stations, which could fetch more than $1 billion. Murdoch recently said that he could pull the plug on planned asset sales if the price tags offered do not satisfy News Corp. amid recent market volatility.
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