News Corp. Sees Big Drop in MySpace Ad Revenue
Anticipates "higher plane of growth" with appointment of new leadership.
News Corp. reported a 16 percent decline in ad revenue within its Fox Interactive Media (FIM) subsidiary, which includes MySpace. The company said the unit saw reductions in both brand and performance-based advertising.
The drop contributed to an overall decline of 11 percent in FIM’s operating results. Also dragging on the unit were costs associated with the company’s MySpace Music joint venture with record labels and the launch of unspecified new features.
Chairman and CEO Rupert Murdoch said the appointment of a new leadership team at MySpace, following the hire of Jonathan Miller to oversee News Corp’s digital operations, would help put the social networking giant on a “higher plane of growth.”
That team includes CEO Owen Van Natta, former chief revenue officer at Facebook; Chief Product officer Jason Hirschhorn, who led digital at MTV Networks; and COO Michael Jones, previously with AOL as an SVP focused on social media.
“We believe the management moves we’ve made over the past two weeks will help [MySpace] regain its momentum,” said Murdoch.
News Corp.’s newspapers performed abysmally, as expected. The bad news included a 35 percent decrease in display and classified ads at The Wall Street Journal. However strong audience growth was reported at WSJ Online. Visitors in April numbered 26.5 million, nearly double the year-ago period. Murdoch said mobile is an area of growth for the site. He said during a three-week period, 360,000 people downloaded the Journal’s iPhone application. The app is free, but only for the moment.
“As you can imagine we’ll soon be making them pay handsomely for the privilege of accessing the world’s best news source,” Murdoch said.
