Murdoch's Internet wing to miss ambitious revenue goal
News Corp.'s Fox Interactive Media will fall $100 million short of its $1 billion annual revenue goal, as its chairman admits being squeezed by tight advertising budgets.
Rupert Murdoch is admitting that the U.S. economy's pressure on advertising budgets is putting the squeeze on News Corp.
News Corp.'s Fox Interactive Media, which oversees all News Corp. Internet business, including MySpace.com, is expected to fall $100 million short of its ambitious $1 billion annual revenue goal, according to a Reuters report. While on News Corp.'s fiscal third-quarter earnings conference call, however, the News Corp chairman and chief executive reportedly called FIM's business "very healthy" and promised "well over" $1 billion in revenue in fiscal 2009.
"There's no doubt the consumer economy is stressed," Reuters quoted Murdoch as saying. "You're seeing it affected in advertising, more short-term planning, and booking."
In addition to MySpace, other FIM networks include Photobucket, IGN Entertainment, and Fox Sports.
News Corp. reported that its net profit rose to $2.7 billion, or 91 cents per share, in the quarter ended March 31, from $871 million, or 27 cents per share, in the year-ago period, according to Reuters.
Last month,that included the creation of an "Audience Network" unit that, according to a company statement, "will be to optimize monetization across FIM's content network and for third-party publishers," leveraging the company's ad technology that can target ads based on interests. The new unit combined advertising technology, ad operations, and performance sales efforts into one unit.