By ,
Published January 13, 2015
This is a partial transcript from Your World with Neil Cavuto, November 5, 2002, that was edited for clarity. Click here for complete access to all of Neil Cavuto's CEO interviews.
Watch Your World w/Cavuto weekdays at 4 p.m. and 1 a.m. ET.
NEIL CAVUTO, FOX ANCHOR: With us now, the chairman and chief executive of News Corp. -- the parent company of this network -- and, by the way, my boss: Rupert Murdoch.
Good to see you, Mr. Murdoch. Congratulations.
RUPERT MURDOCH, NEWS CORP. CHAIRMAN AND CEO (NWS): Afternoon to you. Nice to be with you.
CAVUTO: I should disclose I am a News Corp. shareholder and a News Corp. shareholder and a News Corp. preferred shareholder, a FOX shareholder, so I have a vested interest in you doing well.
MURDOCH: Congratulations.
CAVUTO: Now it is percolating -- or is it?
MURDOCH: Yes, things are going very well, really. The cable examples reported a 200 percent increase in profit. That's sort of locked into continue, I think, for some time. The television stations all were fantastic. That is also -- and we're still pacing even better for December; we're 20 percent ahead of last year in our pacings. Next year, it's too early to make any firm predictions, but we certainly don't have any bad news. So we're feeling pretty good about things.
This came in the face of that result of lower earnings from the actual film division, because we didn't have any big films, and lower earnings in British newspapers, where we're in a price war, which we're serving the public and winning the war.
CAVUTO: What's interesting in that price war there, so whatever you might lose in circulation your more than gaining in advertising. And this seems to be a global phenomenon for your company.
MURDOCH: We're losing circulation revenue, but gaining actual numbers in sales of papers.
CAVUTO: So what do you make of that, that advertising across all those platforms is picking up?
MURDOCH: Well, I have got to be honest with you, the print advertising has not been as strong as electronic. And in Britain, I think we're ahead of opposition, we're up a little bit in advertising right across. We're up more strongly in Australia in advertising. Here, I believe, the newspapers have a pretty mixed picture.
CAVUTO: In the broadcast, in the electronic?
MURDOCH: The broadcast is all good.
CAVUTO: Yes, what does that say to you about just the economy?
MURDOCH: I'd say it's busy, it's competitive. It has recovered its nerve from six months ago or 12 months ago. The car companies are advertising well, the fast food companies, the drug companies. It's really across the board that we're seeing strong advertising, whether it's in local stations or on our network.
CAVUTO: Do you buy that argument, Mr. Murdoch, that as advertising goes, so goes eventually the economy? In other words, if more people are committing more money to more ads, that the economy percolates?
MURDOCH: Yes, I think so. We hope, we believe advertising works, so that should happen. But I don't know whether this -- you read the papers and bad car figures last month and some -- whether there's some disconnect here. But at the moment, the economy is running very competitively, and in the consumer end of it, you know, very well for us.
CAVUTO: You had a great deal of strength in the cable part of your operations, particularly, if I may sound self-serving, at FOX News channel and some of the other cable properties. Are you surprised at he strength that you've getting there?
MURDOCH: No, that was coming through because we've been working for years getting commitments for distribution. That distribution is now taking place. Nielsen has it at I think nearly 80 million homes for FOX News and for FX. The regional sports networks are over 60 million, we have new channels like SPEED, which is doing 50 million. And the National Geographic Channel is very small, but we have commitments; you'll see us reporting positively about that over the next two or three years. At the moment, we only have commitments to be put on the cable channels.
CAVUTO: Right, depending on the roll-out.
We have looked at your stock the last few weeks. I think we have a chart of this. It's been a rather remarkable growth, in excess of 30 percent, just over the last few weeks. But what do you make of that phenomenon, because it has been particularly pronounced in News Corp. more than some of the other media entities out there, the Disneys or Viacoms, what have you?
MURDOCH: Well, I don't know. Disney is down a lot, and of course, you had the collapse of AOL. Viacom has been doing well. They are a very simple company to understand. They only operate in this country. They're pretty much only advertiser based, apart from Blockbuster business. And they have been doing a great job. But outside of them, I would say that media companies are down fully as much as we have been down, or more.
CAVUTO: So when you look at the comeback that you've experienced and some of the others experienced, to a slightly lesser degree in that same time frame, just really three or four weeks.
MURDOCH: Much less than this 50 percent.
CAVUTO: Right. So what do you interpret from that, that this is the real turn around? Because we've had head fakes before, in July and August.
MURDOCH: We've been doing a lot of development of new businesses, like FOX news. People thought we were crazy, it cost us money for four years. It is now making very good money. Same with FX. We could do the same again. We just bought Sky Italy. We are going to be the only pay television in the whole of Italy, this country the size of Britain, with no cable opposition. After a couple of years, that will be a major contributor to us.
So you know, we have a lot ahead of us.
CAVUTO: Let me ask you about DirecTV. You know I'd probably bring that up. Charlie Ergen looks like he's lost it, both the FCC and the Justice Department rejecting it. He could try to appeal this. He still hasn't given up technically on it. What say you?
MURDOCH: He will appeal it, and GM-Hughes would have to stand behind him and show best efforts until their drop-dead date in January. Otherwise, they will risk their break-up fee. But you know, if it comes up, it is not Hughes or direct that's coming up. It is the General Motors shareholding of 30 percent. We are going to have to look at the company again, see what damage has been done to it by Charlie over the last 12 months.
CAVUTO: Do you worry about that, that he has damaged it?
MURDOCH: We don't know. We'd have to look. And we are not going to do any foolish that's going to weaken our position in News Corp. We've got everything else going very well; we're expanding well. At the right price at the right time, we would be interested.
CAVUTO: But it wouldn't be the same price it was a year ago?
MURDOCH: Oh, no. The market has taken care of that.
CAVUTO: Taken care of that. Do you feel like you were pretty savvy with this?
MURDOCH: No, we still feel hardly done by. We did everything that General Motors asked us to do, and in fact, at their board meeting, they actually got to the point where they were reading out the resolution to unanimously approve our deal when there was a telephone interruption from Detroit that said can you hold it up for a couple days.
CAVUTO: That was the end of that.
Republicans retake control of the Senate, and the market seems to handicap some of that in the equation here: Do you buy that? Would you like to see that?
MURDOCH: I think that's a bit of a stretch. But if they were to do so, it would be a fantastic thing for George Bush as president if he was toe get both houses. And we have just seen on FOX News people saying it wouldn't be comfortable for him in 2004. But in fact, he could do a lot of things like reigning in the trial lawyers, getting through his disaster insurance, making the tax cuts permanent that I think would give business a lot of confidence.
CAVUTO: Rupert Murdoch, very good seeing you again. Thanks for stopping by.
The chairman and chief executive of News Corp., Rupert Murdoch.
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