Posts Tagged ‘Fox Networks’

Murdoch’s bold new plan: News Corp announces split of Entertainment and Publishing

Monday, July 2nd, 2012

News Corp announced on Thursday that their board unanimously agreed on a plan to split its company’s entertainment division (which includes Fox News, 20th Century Fox, and Fox Networks) from the publishing division (which includes The Wall Street Journal, Harper Collins publishing, and The New York Post), reports The Economist. This comes as music to the ears of News Corp’s investors, who for years blamed the publishing arm for weighing down the entertainment division. (The entertainment division is responsible for 75 percent of the company’s profits.) Splitting the company in two is the “ultimate dream” of investors, says Michael Nathanson of Nomura, a stockbroker. News of the split sent News Corp’s stock up 10 percent.

This announcement and Rupert Murdoch’s “never say die” commitment to his beleaguered publishing arm come as little surprise to those of us who have followed the News Corp over the years. In a Thursday morning memo announcing the split to the News Corps employees, Murdoch made it very clear Family Guyto everyone that his long love affair with publishing is far from over, and even spoke optimistically about his portfolio of newspapers and publishing companies. “Our publishing businesses are greatly undervalued by the skeptics. Through this transformation we will unleash their real potential, and be able to better articulate the true value they hold for shareholders,” stated Murdoch.   

You have to admire the bold vision Murdoch unleashed for his new publishing entity, especially in the wake of the News of the World hacking scandal in the UK, and at a time when two of his newspapers – The New York Post and The London Times – are losing money, comments Even though newspapers may be on life support, they are still emitting a slight pulse. In The Economist article linked to earlier in this blog post, Jeff Logsdon of BMO Capital Markets added, “The newspaper business may not be growing, but it generates enough cash flow to sustain itself.”

Murdoch points to new global markets and platforms as major reasons for this publishing arms rejuvenation, with plans to accelerate growth into Australia and Latin America and citing the fact there are over 75 million tablets worldwide ready to receive information. “Our publishing company will deliver on the promise of a well-informed society as we aggressively grow our business across borders and new global platforms,” Murdoch is quoted as saying in this Wall Street Journal article.

While many remain a bit skeptical when it comes to publishing, especially newspapers, my colleague Johna Burke confirms in a recent Fresh Ideas post, Mobile Aids Growth of Traditional Media. She writes, “[…]unless you are seeing your coverage from ALL types of media, you won’t have an accurate representation of how your messages are playing out and influencing ALL of your audiences. […] a digital focus alone, that doesn’t include traditional media, is blindingly misleading and can be equated to looking at the Grand Canyon through a straw. Sure, it’s pretty, but you miss more than you see!” 

So, in 2012 one thing remains clear: content remains king and nobody knows that better than Mr. Murdoch.

Landmark Entertainment Deals Ring in the New Year

Monday, January 11th, 2010

Champagne bottle ready for celebrationThe drama that unfolded in the media and entertainment world the last week of 2009 and the first week of 2010 marks just the beginning of what should be a very interesting year. Entertainment content providers, mainly the networks and movie studios and subscription based services that distribute their content (e.g., pay-cable providers and DVD retailers) begin a year that may well be filled with much wheeling and dealing:

News Corp, Fox Networks parent company, and Time Warner struck a deal at the eleventh hour on Dec 31, settling a retransmission fee dispute that has been raging for months. Fox threatened to force cable TV providers Time Warner Cable and Brighthouse Network to drop their broadcast signal which would have prevented over 6 million cable subscribers from watching their programming including: NFL games, college football’s Sugar Bowl, and America’s most watched TV series, American Idol. The thought of having live sports blacked out on New Year’s Day, especially college football, was unimaginable to me in the not so distant past.

Early last week Warner Brothers struck a deal ending a spirited dispute with Netflix that began in August 2009. Warner Brothers requested that Netflix wait 28 days before releasing movies on their rental service so Warner Brothers could realize higher DVD sales. (On average 75 percent of total  DVD sales occur in the first month of the release.) In exchange, Warner Brothers has agreed to make more of their titles available on Netflix streaming service.

The News Corp. Time Warner deal is sure to precede several others coming from rival network providers CBS, ABC-Disney, and NBC looking to increase their fees.  And the Warner Brothers Netflix deal should set a precedent for other studios to restructure current and future deals with DVD retailers.

Not all of these disputes ended happily, however. Scripps Network actually pulled the plug on the Food Network and HGTV affecting 3.1 million Cablevision subscribers after the two sides failed to reach an agreement over fees.

With executives unsure about how to monetize their web content or how they will adapt to multiple devices and platforms – the one thing they seem pretty certain of these days is that they are the ones producing the fuel that keeps this machine moving. Or Maybe we just took our entertainment for granted over the years and expected it to be within our constitutional rights to turn on channel 2 (CBS-New York) to watch the World Series or channel 5 (Fox-New York) to watch the Family Guy at no additional charge. We never thought twice about paying for a movie, whether at the box office, rental fees, or DVD purchases. And since its inception, we’ve always paid a premium for cable programming.

So maybe it’s time we view all content as equals regardless of whether we’re being entertained by Peter Griffin (Family Guy), George Clooney, or Derek Jeter. I would just like to watch what I want when I want – and for that I’m willing to pay a little more.

How are these recent negotiations affecting your PR and marketing efforts? On a personal level, are you willing to pay more for content if it means you get to access your favorite shows? Share your thoughts with the readers of BurrellesLuce Fresh Ideas.