Company remains committed to social network; sees MySpace Music and Video as offering opportunities to increase paid content and sponsorship revenue.
Ad revenue was flat and earnings were down at News Corp.'s Fox Interactive Media (FIM) unit, as the company reported its quarterly results.
Earnings at FIM were about $7 million, much lower than the year-ago period. That was partly the result of higher costs at MySpace, where News Corp. spent money to grow the site's audience, expand internationally, and launch MySpace Music.
Chairman Rupert Murdoch told investors MySpace Music and MySpace Video offer strong opportunities to boost paid content and sponsorship revenue.
"After five years, MySpace still leads the social networking category in the U.S. and has become a substantial business we believe will continue to grow," he said.
Murdoch also expressed bullishness about the long-term resilience of display advertising, which has not performed well of late for AOL, Yahoo, and other online media sellers. The trouble with display advertising, he said, is the "almost infinite increase in inventory," which can be addressed through better targeting.
"There's constant downward pressure on the rates you can get," he said. "We have to find new ways to monetize our huge audiences. Being more data driven is good and will be increasingly important."
Commanding inventory representing hard-to-reach audiences is also a plus. Murdoch said The Wall Street Journal is on track to sell $125 million in online advertising by the end of the current fiscal year, which wraps up in June.
The mixed results for interactive came as News Corp. reported its first loss in more than three years on major revenue declines in its television and print businesses. News Corp. took a charge of $8.4 billion to reflect the lower value of its assets, and the company lowered its guidance for full-year 2009.
Murdoch chalked up the abysmal performance to "the worst global economic crisis we've witnessed since News Corp. was established more than 50 years ago."
August 10-12: Revolutionize your digital marketing campaigns at ClickZ Live San Francisco! Educating marketers for over 15 years, our action-packed, educationally-focused agenda covers every aspect of digital marketing. Early Bird rates available through Friday, July 17 - save up to $300! Register today.
Until March 2012, Zach Rodgers was managing editor of ClickZ's award-winning coverage of news and trends in digital marketing. He reported on the rise of web companies, data markets, ad technologies, and government Internet policy, among other subjects.
US Consumer Device Preference Report
Traditionally desktops have shown to convert better than mobile devices however, 2015 might be a tipping point for mobile conversions! Download this report to find why mobile users are more important then ever.
E-Commerce Customer Lifecycle
Have you ever wondered what factors influence online spending or why shoppers abandon their cart? This data-rich infogram offers actionable insight into creating a more seamless online shopping experience across the multiple devices consumers are using.