Imagining the Future… Chief Executive Officer's Letter
Total Page:16
File Type:pdf, Size:1020Kb
Annual Report 2006 Imagining the future… Chief Executive Officer's Letter imagine opportunity …today iscal 2006 was a year of change, challenge I could not be prouder of our accomplishments and achievement for News Corporation. this past year and over the last several record-break- FWe accelerated the transformation of our ing years. Yet I am even more impressed by the ener- company from a traditional media company into a gy and intelligence with which our employees and major digital player. And we did so while maintain- senior management have grasped the opportunities ing the competitive edge that has made our more of the digital revolution – a revolution that holds the established businesses the leaders in their fields. promise of changing our world as fundamentally as Full year results once again speak for themselves the Agricultural and Industrial Revolutions. Digital – and more loudly than ever. Operating income technologies – broadband, mobility, storage and rose to record levels at nearly all segments of our wireless – play to our company’s historical strengths: company, including Direct Broadcast Satellite offering consumers the widest possible array of Annual Report 2006 Television, Cable Network Programming, Television, quality content, delivered in ways they prefer. Filmed Entertainment, Magazines and Inserts, News Corporation’s core mission has always and Book Publishing. Earnings per share from been to provide as many consumers as possible continuing operations rose by 26 percent to 87 with the highest quality content through the cents, its highest level ever. most convenient distribution channels. That was 4 NEWS CORPORATION News Corporation As of June 30, 2006 FILMED ENTERTAINMENT Asia MAGAZINES AND INSERTS OTHER STAR United States STAR PLUS United States and Canada United States Fox Filmed Entertainment STAR ONE News America Marketing Fox Mobile Entertainment Twentieth Century Fox Film STAR Chinese Channel In-Store Fox Interactive Media Corporation STAR World FSI (SmartSource Magazine) MySpace Fox 2000 Pictures STAR Utsav SmartSource iGroup IGN Entertainment Fox Searchlight Pictures Vijay News Marketing Canada RottenTomatoes Fox Music Xing Kong The Weekly Standard AskMen Twentieth Century Fox Home STAR Chinese Movies Gemstar-TV Guide International 41% FoxSports.com Entertainment STAR Movies Scout Twentieth Century Fox Licensing STAR Gold WhatIfSports and Merchandising STAR News 26% BOOK PUBLISHING kSolo Blue Sky Studios Fox.com Channel [V] United States, Canada, Europe Twentieth Century Fox Television Channel [V] Thailand 50% AmericanIdol.com Fox Television Studios and Australia ESPN STAR Sports 50% HarperCollins Publishers Europe Twentieth Television Phoenix Satellite Television 38% Regency Television 50% NDS 74% ANTV 20% Broadsystem Ventures Asia Latin America Convoys Group Balaji Telefilms 26% Cine Canal 23% London Property News Telecine 13% News Outdoor Group Latin America Mosgorreklama 50% Canal Fox Australia and New Zealand NEWSPAPERS Balkan News Corporation Premium Movie Partnership 20% Fox Televizija United States TELEVISION New York Post Australia and New Zealand CABLE NETWORK PROGRAMMING FOXTEL 25% United States United Kingdom Sky Network Television Limited 44% FOX Broadcasting Company United States The Times National Rugby League 50% MyNetworkTV FOX News Channel The Sunday Times News Interactive Fox Television Stations Fox Cable Networks The Sun Propertyfinder.com WNYW New York, NY FX News of the World RealEstate.com 58% WWOR New York, NY Fox Movie Channel TSL Education KTTV Los Angeles, CA Fox Regional Sports Networks love it! Asia KCOP Los Angeles, CA (15 owned and operated) (a) insideout Hathway Cable and Datacom 26% WFLD Chicago, IL Fox Soccer Channel Travel Magazine China Network Systems WPWR Chicago, IL SPEED various WTXF Philadelphia, PA Australia FUEL TV More than 110 national, metropolitan, KDFW Dallas, TX FSN KDFI Dallas, TX suburban, regional and Sunday titles, Fox Reality including the following: WFXT Boston, MA Fox College Sports WTTG Washington DC The Australian National Sports Partners The Weekend Australian WDCA Washington DC National Advertising Partners WAGA Atlanta, GA The Daily Telegraph Fox International Channels The Sunday Telegraph WJBK Detroit, MI Fox Sports Net Bay Area 40% KRIV Houston, TX Herald Sun Fox Pan American Sports 38% Sunday Herald Sun KTXH Houston, TX National Geographic Channel – KMSP Minneapolis, MN The Courier-Mail International 50% Sunday Mail (Brisbane) WFTC Minneapolis, MN National Geographic Channel – WTVT Tampa Bay, FL The Advertiser Domestic 67% Sunday Mail (Adelaide) KSAZ Phoenix, AZ National Geographic Channel – KUTP Phoenix, AZ The Mercury Latin America 67% mX WJW Cleveland, OH STATS, LLC 50% KDVR Denver, CO Sunday Tasmanian WRBW Orlando, FL Australia The Sunday Times WOFL Orlando, FL Premier Media Group 50% Northern Territory News KTVI St. Louis, MO Sunday Territorian WDAF Kansas City, MO INSIDEout WITI Milwaukee, WI DIRECT BROADCAST SATELLITE donna hay Big League KSTU Salt Lake City, UT TELEVISION WBRC Birmingham, AL Sunday Magazine WHBQ Memphis, TN Europe ALPHA WGHP Greensboro, NC SKY Italia Fiji KTBC Austin, TX Sky Sport The Fiji Times WUTB Baltimore, MD Calcio Sky Sunday Times WOGX Gainesville, FL Sky Cinema Nai Lalakai Sky TG 24 Shanti Dut British Sky Broadcasting 38% Sky News Papua New Guinea Sky Sports Post-Courier 63% Sky Travel Sky One Sky Movies (a) Fox Regional Sports Networks are all 100% owned except for Fox Sports Net South which is 88% owned. United States The DIRECTV Group 38% The words “expect,” “estimate,” “anticipate,” “predict,” “believe” and similar expressions and variations thereof are intended to identify forward-looking statements. These statements appear in a number of places in this document and include statements regarding the intent, belief or current expectations of News Corporation, its Directors or its Officers Asia with respect to, among other things, trends affecting the group’s financial condition or results of operations. Readers TATA SKY 20% of this document are cautioned that any such forward-looking statements are not guarantees of future performance and involve risks and uncertainties. The Company does not ordinarily make projections of its future operating results and undertakes no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by law. Chief Executive Officer's Letter imagine opportunity …today iscal 2006 was a year of change, challenge I could not be prouder of our accomplishments and achievement for News Corporation. this past year and over the last several record-break- FWe accelerated the transformation of our ing years. Yet I am even more impressed by the ener- company from a traditional media company into a gy and intelligence with which our employees and major digital player. And we did so while maintain- senior management have grasped the opportunities ing the competitive edge that has made our more of the digital revolution – a revolution that holds the established businesses the leaders in their fields. promise of changing our world as fundamentally as Full year results once again speak for themselves the Agricultural and Industrial Revolutions. Digital – and more loudly than ever. Operating income technologies – broadband, mobility, storage and rose to record levels at nearly all segments of our wireless – play to our company’s historical strengths: company, including Direct Broadcast Satellite offering consumers the widest possible array of Annual Report 2006 Television, Cable Network Programming, Television, quality content, delivered in ways they prefer. Filmed Entertainment, Magazines and Inserts, News Corporation’s core mission has always and Book Publishing. Earnings per share from been to provide as many consumers as possible continuing operations rose by 26 percent to 87 with the highest quality content through the cents, its highest level ever. most convenient distribution channels. That was 4 NEWS CORPORATION the strategic imperative behind our entry into Last year, we acquired MySpace.com, the Internet’s the satellite business, and that same imperative most popular social networking site, as well as the now propels us into the digital world. All of the gaming and entertainment site IGN.com and several historic constraints inherent in distribution – other smaller, but promising, sites. We launched Fox prohibitive entry costs, hard-to-reach locations, Interactive Media to oversee these new businesses, to sluggish technology – are being swept away by build up our existing web presence and to improve digital technology. For the first time in media coordination and synergy across all of the company’s history, complete access to a truly global audience websites and digital media efforts. As a result, in the is within our grasp. space of one year, our company has begun to rival No company is better positioned to seize this and, in some cases, surpass the Internet elite. FIM opportunity than ours. Some boast high traffic sites now rank second in total page views and fifth in but little content. Others have plenty of content unique visitors in the U.S. and reach more than 100 but little traffic. Only News Corporation combines million people per month worldwide. In addition, high traffic with vast amounts of compelling traffic is up dramatically at most of our pre-existing content. Our situation is unique – and powerful. sites, such as those from our newspapers, cable net- And we