May 28 Robert Thomson, chief executive of the
new News Corp, said there will be "relentless" cost
cuts in store for the newspaper business as it prepares to
separate from Rupert Murdoch's entertainment empire.
The cornerstone of the company will be its balance sheet -
more than $2 billion in cash - to buffer the company and appease
investors in the long term.
The new News Corp, as it will be known on June 28, will be
"relentless" in cost cutting, said Thomson, who remained bullish
about the business.
"Let me be clear, print is still a particularly powerful
platform," Thomson said.
Murdoch reminded investors gathered in Manhattan that he had
built one of the world's most successful media conglomerates and
that indeed some of the properties he assembled "have
their individual challenges. But they are undervalued,
"I am not saying I didn't make many mistakes along the way
-even some spectacular ones... Why do it all over again? The
simple answer, there is opportunity everywhere," Murdoch said.
Late on Friday, News Corp said it would write down the value
of its Australian and U.S. publishing assets by up to $1.4
billion, potentially wiping out the company's estimated profit
for the quarter ending June 30.
The new News Corp will include The Wall Street Journal and
The Times in London, Australian pay-TV services, book publisher
HarperCollins and fledgling education division Amplify.
The Fox network, the movie studio and a set of lucrative
cable properties will become a separately traded company called
21st Century Fox.
The spin-off of the publishing division comes as newspapers
face plunging advertising revenue and readers who increasingly
prefer to get news on smartphones and tablets.
Newspaper companies - once considered blue-chip investments
- have seen their shares tumble over the decade as investors
fear a permanent drain in advertising revenue.
The new News Corp also unveiled its logo Tuesday - written
in a cursive script based on handwriting of Murdoch and his
father Keith, whose Australian newspapers were the seeds of the
News Corp empire.