"Traditional media can have a very long life, provided they have leadership," Mr. Chernin told investors yesterday at the UBS Global Media and Communications Conference. "I wouldn't want to be the third newspaper in a market or the fifth TV station."
Looking at entire media mix
He said having cash-flow-rich traditional media as a foundation makes it possible for News Corp. to be more aggressive in the new-media space. "It's a great platform for new businesses," he said, adding that while News Corp. is "religiously focused on growth" it measures the growth of the entire mix of assets and aims for double-digit increases annually.
He addressed the YouTube acquisition -- "We didn't think it was worth one and a half billion and we didn't buy it" -- but he said News Corp. doesn't "want to convey we're somewhat satisfied. We're reasonably impatient about the digital space." The keys to making more money with what the company already has in digital assets lies in improving the ability to sell ads, growing internationally and adding new tools such as video.
The company has given "a tremendous amount of thought" to partnering with YouTube and believes it is in a unique space given that News Corp. is both a copyright holder and a distributor of content online. Mr. Chernin said he believed the Google-YouTube deal was the "beginning of consolidation -- two big video players combined." He said the industry's moves toward what he believes will eventually be a couple big players will bode well for content holders because it will create bigger platforms for monetizing content.
Not nervous about Fox finish
As for one of News Corp.'s so-called traditional businesses, the Fox network, Mr. Chernin said the company was not satisfied with its fourth-place sweeps finish but that didn't mean that management was in trouble. "I'm absolutely not nervous," he said. "But we're wholly dissatisfied with the performance this fall. ... We've got to move the ball forward and we didn't make any progress."
He said it's not a structural thing and he has confidence in his team but the network simply needs to do a better job of development.