inside track

News Corp. exec concerned despite improved Q3 boosted by strong TV

News Corp. president and COO Peter Chernin warned Wednesday of the negative impact of what he argued already is a "de facto actors strike" that has started slowing down projects.

"It is difficult for anyone to start a movie now" because a formal strike would interrupt it, he said during his company's earnings call that revealed improved fiscal third-quarter earnings driven by strong TV results. "It's a really bad thing for the industry," especially after an "extremely devastating" WGA strike, Chernin said.

Asked about producers' strategy in their AFTRA talks compared to SAG talks, he said they are not looking for quick deals with any one group over another. Instead, "we seek fair deals for everyone," he said.

Chernin also told analysts that News Corp. will make only select films available day-and-date on cable VOD. His firm will "keep monitoring and experimenting" with different genres in this window to ensure DVD sales don't get cannibalized, Chernin said.

Chernin also confirmed that Fox Interactive Media, the unit that houses MySpace, will fall slightly short of its full fiscal-year target of $1 billion in revenue. He suggested it would hit about $900 million but emphasized News Corp. remains happy with the "very healthy business" and pointed to "significant progress."

News Corp. management also made clear that though it remains open to discussions, it is happy running FIM as a stand-alone business. Chernin and chairman and CEO Rupert Murdoch said they haven't held talks in a couple of weeks with Yahoo, AOL and Microsoft, which have been possible deal partners.

After the market close, News Corp. reported a fiscal third-quarter profit of $2.7 billion, compared with $871 million a year ago. The latest period included a $1.7 billion gain from an asset swap with Liberty Media that handed control of DirecTV John Malone's company.

News Corp.'s operating income and revenue grew 16% each to $1.4 billion and $8.75 billion, respectively. (partialdiff)