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How News Corp. Could Face An Advertiser Mutiny Costing It Hundreds Of Millions (NWS)

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Rupert Murdoch

Dial Corp.'s new lawsuit against News Corp. could set the stage for a full-scale mutiny among Rupert Murdoch's advertising clients, according to a prominent retail industry lawyer. Such a mutiny could cost News "hundreds of millions of dollars," the attorney speculates.

Daniel Low, of law firm Kotchen & Low, wrote in a blog post that he was surprised that all News Corp.'s clients who used its News America Marketing subsidiary for grocery coupon distribution haven't joined a suit against the company.

The suit, filed by Dial, alleges that News broke antitrust law with exclusionary contracts and practices that kept prices for its coupon clients artificially high for years. (Dial is owned by Henkel, which markets supermarket staples such as Loctite, Persil and Purex, in addition to Dial Soap.)

Dial makes a bunch of dramatic allegations, including:

  • News allegedly hacked into computers owned by a rival in-store advertising company, Floographics, to obtain customer lists.
  • News made large up-front payments to supermarkets to guarantee they would deal exclusively with News and not competitors.
  • News tore down rival advertisers' signs and ads when they saw them in stores who had signed such contracts.

  Low says:

It is surprising that the Dial lawsuit was brought only on behalf of Dial, and not as class action on behalf of all affected CPGs [consumer packaged goods companies].  Given the high litigation costs of a monopolization lawsuit, the hundreds of potential class members, and the hundreds of millions of dollars that could be at stake for CPGs, a class action seems to be a more efficient vehicle for resolving the claims.

Low's speculation isn't idle. News has already lost several rounds of litigation over its alleged antitrust activities in the grocery coupon business, and it has cost the company $656 million in settlements. Those settlement were with Floorgraphics, Valassis and Insignia Systems, all agencies that supply advertising services for coupons and groceries.

Among their clients, only Dial has weighed in publicly against News, seeking money back for alleged illegal high prices. But evidence emerged in the previous litigation that several other News clients were allegedly overcharged. Among them: Conagra, Pepsi, Smuckers, DelMonte, Kraft, Coca-Cola, Clorox, Kimberly-Clark, GlaxoSmithKline, Novartis, Pfizer, Reckitt Benckiser, Dial, Quaker Oats, Church & Dwight, Unilever, Tyson, Hain Celestial, T. Marzetti, and Campbell's Soup.

Of those, the most angry client was undoubtedly former Sara Lee marketing executive Debra Lucidi, who once wrote an email describing her experience as a News America Marketing client. She said "it feels like they are raping us and they enjoy it" (click to enlarge):

sara lee rape memo

SEE ALSO: Latest News Corp. Hacking Suit Alleges Execs Used Al Capone As A Role Model

SEE ALSO: Why News Corp. Invested $30 Million In Cow And Chicken Farms

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CONFIRMED: Rite Aid And Family Dollar Have Axed News Corp's Troubled In-Store Ads Division (NWS, VCI, ISIG)

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Rupert Murdoch

News America Marketing, the in-store advertising and grocery coupon agency that's owned by Rupert Murdoch's News Corp., just lost two huge contracts — Rite Aid and Family Dollar— to its arch-rival in the supermarket business, Valassis, according to a source who tipped Business Insider and a Rite Aid spokesperson.

The news doesn't sound dramatic unless you know the context: News and Valassis have been locked in a years long war for domination of the supermarket/grocery business, a battle which has so far cost News $656 million in legal settlements over allegations that it used antitrust tactics to drive competitors out of the market.

Since that settlement, News was sued by Dial Corp, alleging its tactics kept prices higher than they should be for in-store advertising and newspaper coupons. We speculated that suit could — and that's a highly qualified "could"— lead to a full-scale mutiny of News' in-store clients.

We reached out to all four companies. News and Valassis didn't reply; we've yet to hear back from Family Dollar. But Rite Aid confirmed: "To answer your question, effective Jan. 1 of this year, we began using Valassis."

Here's our tipster's info:

News America just lost 11,900 stores combined on Dec. 31 ... They lost the 7,200 Family Dollar chain based out of North Carolina and the 4,600 Rite Aid Drug chain based out of Pennsylvania. The up and coming Valassis instore division landed these two big retailer contracts and the addition of the Rite Aid chain is a big win for their partnership with Insignia. [Insignia is a smaller in-store agency that works with Valassis.] Valassis is now a 15,000 total store player.

Anyone else with information, please email me or use the comments below.

SEE ALSO: How News Corp. Could Face An Advertiser Mutiny Costing It Hundreds Of Millions

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Aussie Pension Fund Sells News Corp Stake, Citing Board's Failures (NWS)

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Rupert Murdoch

Jan. 10 (Bloomberg) -- The pension fund for workers in Australia’s pulp and paper industry sold its stake in the country’s largest publisher News Corp., saying the company controlled by Rupert Murdoch needs a more independent board.

First Super, which invests about A$1.7 billion ($1.8 billion) for about 72,000 members in the country’s timber, pulp, paper, and furniture industries, said it was selling the stake after the failure of a push at the company’s annual shareholder meeting for an independent chairman and more independent directors.

Murdoch is News Corp.’s chairman and chief executive and has the largest voting stake in the company, with about 40 percent of Class B shares. That control, combined with a 7 percent voting stake held by Prince Alwaleed bin Talal, a friend of the Murdoch family, makes it difficult to enact changes to the board, an arrangement criticized at News’s annual shareholder meeting in October.

“The interests of minority shareholders have too often been compromised,” Michael O’Connor, co-chairman of the fund, said in the statement. Executives of News Corp. were paid “outrageous amounts of money,” he said.

News Corp. shares traded in Sydney rose 1 percent to A$25.745 as of 2:35 p.m., compared with a 0.3 percent gain in the S&P/ASX 200 index.

The shares sold by First Super are worth about A$7 million, Phil Davey, an external spokesman for the fund at Mountain Media Pty., said by phone. That’s about 0.01 percent of News Corp.’s A$60 billion market value.

Investors who favor splitting the chairman and chief executive roles include the California Public Employees’ Retirement System, the biggest U.S. pension fund. Bloomberg LP, the parent of Bloomberg News, competes with News Corp. units as a supplier of financial information.

Stephen Browning, a spokesman for News Corp.’s Australian publishing unit News Ltd., said he wasn’t able to comment on group issues. Julie Henderson and Nathaniel Brown, New York- based spokesmen for News Corp., didn’t immediately respond to an e-mail sent out of office hours requesting comment.

--Editors: Dave McCombs, Subramaniam Sharma

To contact the reporter on this story: David Fickling in Sydney at dfickling@bloomberg.net

To contact the editor responsible for this story: Michael Tighe at mtighe4@bloomberg.net

SEE ALSO: CONFIRMED: Rite Aid And Family Dollar Have Axed News Corp's Troubled In-Store Ads Division

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News Corp. Appears To Confirm It Lost 8,200 Stores From Its Client List (NWS)

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Rupert Murdoch

Two separate statements from News Corp. appear to indicate that the company's News America Marketing — which handles its obscure but lucrative grocery coupon and in-store supermarket advertising advertising business — has lost 8,200 stores from its network.

It could be the beginning of a costly ad client mutiny for Rupert Murdoch's News, which has already seen Rite Aid, Family Dollar and Dial Corp. turn against it. Those store networks and advertisers are angry at News after litigation revealed it allegedly used illegal monopolistic practices to keep prices artificially high for its advertisers. news settled those allegations — which came from competing coupon and in-store agencies — for $656 million.

Dial Corp. then sued News, alleging it held an unfair monopoly over certain stores. Rite Aid and Family Dollar removed their stores from News sometime in early January.

On Jan. 3, News put out a press release stating that it had a store network of "50,300 retail stores." That's 8,200 fewer stores than what its corporate web site states, where it claims 58,500 stores. News cited two different dates in those statements, with the more recent date showing the lower number.

A News spokesperson did not respond to a message requesting comment.

It's not clear whether the Rite Aid and Family Dollar moves account for the reduction in stores served by News. A source told Business Insider previously that, combined, the two clients' chains added up to 11,900 stores.

The job of fixing this situation falls to Paul Carlucci, the CEO of News America who lost his role as publisher of The New York Post in December after its iPad news product, The Daily, folded. Carlucci was the chief at News America during the period in which the litigation — the source of News' current troubles in the packaged goods business — emerged.

• CONFIRMED: Rite Aid And Family Dollar Have Axed News Corp's Troubled In-Store Ads Division

• How News Corp. Could Face An Advertiser Mutiny Costing It Hundreds Of Millions

• Look Which News Corp. Exec Got His Wings Clipped When 'The Daily' Closed

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News Corp. Sues Heinz As Civil War With Its Own Advertisers Spreads (NWS)

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Rupert Murdoch

Rupert Murdoch's News Corp and Heinz have sued each other in two different federal courts, a sign that an advertiser mutiny against News and its alleged monopolistic practices is spreading.

Previously, News was sued by Dial Corp over similar allegations. Heinz has now joined that suit; and in turn been sued back by News.

Two large drugstore chains, Rite Aid and Family Dollar, removed their business from News America Marketing, the News Corp unit that handles newspaper coupons and in-store marketing.

It is extremely unusual for a major ad handler to be at the center of so much legal conflict with its clients, all at the same time.

The new Heinz suit is particularly surprising because News is suing Heinz for breach of contract even though Heinz is still a current client, and the company has a $468 million annual marketing budget, according to the suit (not all of which is spent via News). Normally, ad agencies and media providers will bend over backwards to avoid conflicts with big-spending clients.

A Heinz spokesperson confirmed to Business Insider that the company had also sued News. “Heinz recently filed a lawsuit against News America on grounds of overpricing and this [new] lawsuit appears to be part of their defense strategy. While we don’t comment on pending litigation, we can tell you that Heinz stands behind its position and we will vigorously pursue this matter.” 

The suits all stem from a lengthy piece of previous litigation in which News was accused by competitors of using illegal monopolistic practices to keep prices artificially high for its advertisers. News settled those allegations— which came from competing coupon and in-store agencies — for $656 million. The 2011 settlement came after reams of negative information came out in court alleging News clients paid higher prices than they needed to for ads.

Now, it seems, many of News' clients are angry that they may have overpaid and want their money back. Other clients named in the 2011 litigation include Conagra, Pepsi, Smuckers, DelMonte, Kraft, Coca-Cola, Clorox, Kimberly-Clark, GlaxoSmithKline, Novartis, Pfizer, Reckitt Benckiser, Quaker Oats, Church & Dwight, Unilever, Tyson, and Campbell's Soup.

Heinz sued News in federal court in the Eastern District of Michigan, alleging antitrust activity in News' supermarket and grocery store advertising. So News struck back in New York federal court, alleging Heinz breached its contract with News by not suing in the jurisdiction the two companies had agreed to litigate their disputes within.

News also seeks a declaratory judgment against both companies that News is not engaging in antitrust or monopolistic practices -- a move that would prevent companies from suing News as a matter of law. In its case, News can point to the fact that it settled the previous antitrust litigation, and thus the cases against were never proven. Dial's suit, for instance, assumes the evidence unearthed in those cases is largely true, even though juries never reached a verdict.

News also claims it is impossible for it to hold a monopoly on prices because spending in the entire category was $20 billion annually, of which News America Marketing's revenues were $400 million, or 2%. And some of the biggest clients -- Walmart, Target, CostCo, and BJ's -- do not use agencies for in-store marketing, for instance.

But the suit also admits part of the case against News might be true. News states in its complaint that it handled both Heinz's newspaper and in-store businesses at the same time, and had a right of first refusal on new work for Heinz.

The 2011 antitrust lawsuits alleged that News illegally bundled those services together -- by offering low prices that were only available if clients took both services -- along with restrictive contracts that prevented other agencies from bidding for clients' new work.

• News Corp. Appears To Confirm It Lost 8,200 Stores From Its Client List

• How News Corp. Could Face An Advertiser Mutiny Costing It Hundreds Of Millions

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RUPERT MURDOCH: The Wall Street Journal Is STILL Being Hacked By The Chinese

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News Corp. CEO Rupert Murdoch said late Tuesday night in a plainly straightforward tweet that Chinese hackers were still targeting The Wall Street Journal:

The WSJ, along with The New York Times, Washington Post, Bloomberg and others, revealed last week that they were the targets of Chinese hackers. The hackers had infiltrated the publications' computer systems in an attempt to gain access to information relating to their coverage of China.

The WSJ also wrote a scathing editorial aimed at the Chinese government:

"[W]hatever else the Chinese thought they were doing by hacking us, they didn't stop the publication of a single article. Now they have only magnified their embarrassment, as their intrusion was eventually bound to be detected and publicized. Perhaps they will now try to deny us travel visas, harass our journalists or otherwise interfere with our business in China.

Meantime, we read that the FBI is investigating China's media hacking and treating it as a national security issue. It's also a plain-old crime, undertaken by a government that fancies itself the world's next superpower but acts like a giant thievery corporation.

The Middle Kingdom might once have been the center of human civilization. But in the digital world, the Chinese are the barbarians at the gate. Whatever they think they've learned about us by sneaking around our inboxes, the world has learned a great deal more about them."

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Influential Tech Site AllThingsD Is In Discussions With Its Parent Company News Corp (NWS)

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Steve Jobs at D8 with Walt Mossberg and Kara Swisher

Influential tech blog AllThingsD might leave its parent News Corp., Peter Lauria and Nadia Damouni at Reuters report.

AllThingsD is led by Kara Swisher and Walt Mossberg. They have developed the site within News Corp. as a standalone property. According to Reuters, it is a profitable venture, probably largely due to its conference business.

The D Conferences attract the biggest names in technology year after year and are must-attend events for anyone in the industry.

AllThingsD's contract with News Corp is up at the end of the year. Right now Mossberg and Swisher are working on a business plan for the future for News Corp. At the same time, there is inbound interest in buying the property from a variety of sources, says Reuters.

For what it's worth, when AllThingsD's contract has been up for renewal in the past, these sorts of rumors have kicked up. There has always been some tension between AllThingsD and its parents.

We're poking around to see if we can add anything to the story. If we can, we'll let you know.

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5 Of Piers Morgan's Ex-Colleagues At The Mirror Have Now Been Arrested In Phone Hacking Scandal

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Piers Morgan

Five employees who worked at The Trinity Mirror newspaper group have now been arrested in connection with the celebrity phone-hacking scandal, Bloomberg reports.

CNN host Piers Morgan is a former editor of The Mirror, and of the News of the World, the Rupert Murdoch paper that was shuttered when the scandal first broke. To be clear, Morgan has not been accused of any wrongdoing. But Bloomberg says "a former Daily Mirror reporter later testified ... that hacking took place on a daily basis among the newspaper’s show-business reporters."

How, exactly, Morgan got one of his most famous voicemail-related scoops remains shrouded in mystery. When asked under oath at the British parliament's inquiry as to how he listened to a voicemail of Paul McCartney pleading with his former wife Heather Mills, he declined to answer, saying only: "I'm not going to start any trail that leads to the identification of a source."

Morgan has previously denied he published any story based on hacking: "I have never hacked a phone, told anyone to hack a phone, nor to my knowledge published any story obtained from the hacking of a phone."

But that denial will take some explaining in the light of these previously reported events:

Doubtless there is an innocent explanation for all of this.

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Murdoch Tabloid 'The Sun' May Be Making A $30M Mistake By Going Behind A Paywall

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The Sun

The Sun, the flagship London tabloid of Rupert Murdoch's News Corp. newspaper empire, will stop being free on the internet and go behind a paywall, Ad Age reports.

It may be making a huge mistake.

The Sun is best known for its topless "Page 3" girls and its scoops about celebrities and their sex lives. That stuff is widely available for free just about everywhere else on the web.

The paper is hoping its readers will pay for access to highlights of Premier League soccer matches. It has paid $30 million for the rights to show football recaps.

Generally, consumers have been willing to pay to watch Premier League soccer. Fox Soccer Channel in the U.S. (another News Corp property), has long had a subscription-based viewership for its exhaustive live coverage of matches.

The web — and highlights in particular — are different, however. The need of fans to see something live is very different from their need to see post-game highlights. The drama of "live" can't be replicated post-facto. (Anyone who has ever recorded a game to watch later knows there's something strangely depressing about waiting for a result that has already happened.) You can watch highlights anytime.

And, of course, game highlights — like topless women — are widely available all over the net. My favorite place to see recaps of games that I've missed (aside from BI's Sports Page, of course) is FootyRoom.com. That's just one of dozens of places that publish highlights.

Unless Murdoch has a plan to shut down every last one of them, it's tough to imagine why anyone would want to pay The Sun to see what's free elsewhere.

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News Corp Threatens To Take Fox Shows To A Paid Cable Network If It Loses Its Lawsuit Against Aereo (NWS)

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family guy griffins.jpg

News Corp's COO Chase Carey told attendees at the National Association of Broadcasters conference today that the company could move Fox programming to a paid cable network if it loses its lawsuit against Aereo.

Aereo is an app that retransmits over the air broadcast signals to mobile devices, meaning you can stream shows from networks like NBC, ABC, CBS, and Fox. Those networks are free for anyone with a TV antenna, but Aereo charges you $8 per month to view them on smartphones and tablets.

News Corp doesn't like that, and it's taking legal action against Aereo. Aereo won the right to continue operations in a federal appeals court ruling last week.

Here's the full statement from Carey following his comments at the NAB conference, as tweeted by New York Times media reporter Brian Stelter:

News Corporation has a long-standing commitment to the broadcast television business, and to delivering the highest-quality entertainment, sports and news programming to our viewers on a localized basis.  We are committed to broadcasting under a business model where programmers receive fair compensation from parties that want to redistribute our product while continuing to make our product available for free to individual consumers that want to access our signal.
 
We believe that Aereo is pirating our broadcast signal.  We will continue to aggressively pursue our rights in the courts, as well as pursue all relevant political avenues, and we believe we will prevail.
 
“That said, we won’t just sit idle and allow our content to be actively stolen. It is clear that the broadcast business needs a dual revenue stream from both ad and subscription to be viable. We simply cannot provide the type of quality sports, news, and entertainment content that we do from an ad supported only business model.  We have no choice but to develop business solutions that ensure we continue to remain in the driver’s seat of our own destiny.  One option could be converting the FOX broadcast network to a pay channel, which we would do in collaboration with both our content partners and affiliates.

Keep in mind, this feels more like an empty threat than an actual promise. Aereo only works in New York City for now and still has a tiny number of subscribers.

UPDATE: Aereo reached out to us with a response to Casey's remarks:

Aereo has invented a simple, convenient way for consumers to utilize an antenna to access free-to-air broadcast television, bringing television access into the modern era for millions of consumers. It's disappointing to hear that Fox believes that consumers should not be permitted to use  an antenna to access free-to-air broadcast television. Over 50 million Americans today access television via an antenna. When broadcasters asked Congress for a free license to digitally broadcast on the public's airwaves, they did so with the promise that they would broadcast in the public interest and convenience, and that they would remain free-to-air. Having a television antenna is every American's right.

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13 Years Later, News Corp. Finally Creates A '21st Century Fox' Brand (NWS)

News Corp. Has A New Logo Based On Rupert Murdoch's Signature

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News Corp., which split off its news properties from its TV and film divisions, has unveiled a new logo for the news unit, based on owner Rupert Murdoch's handwriting.

"The script is based on the writing of Rupert and his father," CEO Robert Thomson told employees in a memo.

Here it is:

news corp logo

Here's the old logo:

News Corp

News Corp also redesigned the logo of the holding company that contains the Twentieth Century Fox studio (the studio retains the "20th" name even though the parent went with "21st."

21st century fox logo

SEE ALSO: Brand New 21st Century Fox Unveils Logo — And It Isn't Great

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News Corp. Newspaper Boss Vows 'Relentless Cost-Cutting In Pursuit Of Profits'

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Rupert Murdoch


(Reuters) - Rupert Murdoch tried to convince Wall Street on Tuesday that there is still money to be made in newspapers, reminding investors that he had defied skeptics over the past 60 years to build one of the world's biggest media empires.

As News Corp prepares to separate its publishing business from its entertainment assets, Murdoch said that while some brands face individual challenges, as a whole the publishing portfolio is "undervalued and underdeveloped."

"I am not saying I didn't make many mistakes along the way —even some spectacular ones," Murdoch said at a meeting in Manhattan to sell investors on the new publishing company.

"You may be wondering why I want to do it all over again," the 82-year-old media mogul said. "The simple answer is: there is opportunity everywhere."

The new publishing company, which will retain the News Corp name, officially kicks off on June 28 with properties such as: The Wall Street JournalDow Jones NewswiresThe Times of London, Australian pay-TV services, book publisher HarperCollins and fledgling education unit, Amplify.

The spin-off comes as newspapers face plunging advertising revenue and readers who increasingly prefer to get news for free on their smartphones and tablets. Shares of newspaper companies - once considered blue-chip investments - have tumbled over the past decade as investors fear a permanent drain in ad sales.

Against this backdrop, the publishing company's new chief executive, Robert Thomson, said there will be "relentless" cost cuts in store for the business. He gave no specifics.

News Corp executives took pains to note almost half of the publishing company's revenue comes from sources other than advertising. One revenue source is Dow Jones, which sells news and information to financial institutions and competes with Thomson Reuters Corp and Bloomberg LP.

Dow Jones CEO Lex Fenwick highlighted the introduction of a new platform, code-named DJ X. He emphasized one product, one price and one standard contract.

"If we can take a little more of institutional spend with DJ X - if we deliver that product with real value, there's a real opportunity to increase our market share," he said.

Fenwick also said Dow Jones is working on a messaging platform to compete with Bloomberg's vaunted product.

CLEAN BALANCE SHEET

Thomson, a close confident of Murdoch, ensured the new publishing company would start out with a clean balance sheet, no debt and $2 billion in cash to buffer operations and attract investors. News Corp intends to pay a dividend, but the board has yet to determine the details. It said it has authorized a share buyback of $500 million.

Still, analysts wanted to know if Murdoch intended to go shopping with his coffer of cash especially where newspapers assets are concerned - including the Los Angeles Times and the Chicago Tribune that are on the market.

Murdoch said if the "price is right" News Corp could be interested in newspapers. But he said that cross-ownership rules that prevent companies from owning top TV stations and newspapers in the same market made it "pretty unlikely."

News Corp said last Friday that 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.

Thomson said the company will have "a permanent start-up sensibility." He added, "We will be relentless in our cost-cutting and in our pursuit of profits."

The new News Corp also unveiled its logo - written in a cursive script based on the handwriting of Murdoch and his father, Keith, whose Australian newspapers were the seeds of the media empire.

The Fox network, the movie studio and a set of lucrative cable properties will become a separately traded company called 21st Century Fox.

"I have been given an extraordinary opportunity most people never get in their lifetime: the chance to do it all over again," said Murdoch.

(Reporting by Jennifer Saba in New York; Editing by Leslie Gevirtz and Tiffany Wu)

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The Wall Street Journal To Launch A LinkedIn Competitor

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Social Media Insights is a daily newsletter from Business Insider that collects and delivers the top social media news first thing every morning. You can sign up to receive Social Media Insights here or at the bottom of this post. 


Wall Street Journal To Launch A Social Network (The Times Of London)
Rupert Murdoch's News Corp. announced plans to launch a social network for its publication, The Wall Street Journal, which would directly compete with LinkedIn, as well as an instant messaging service for financial professionals, according to The Times Of London (a News Corp. property). The news comes shortly after Bloomberg got caught spying on clients who used its popular messaging services on Bloomberg terminals.  Read >

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Today's mobile-savvy consumers in their teens and early twenties are accustomed to shopping online and tend to see their smartphones and tablets as their main computing device, and an important shopping toolPinterest's average user is between the ages of 30 and 49, which is an age bracket with considerable disposable income. Also, Pinterest users tend to be women (anywhere from 80 to 85% of its user base is female). Marketers know that it is women who usually control the purse strings for household purchases related to clothes, home decoration, and gifts — three strong areas for Pinterest. Read > 

5 Tips To Reevaluate Your Social Media Marketing (salesforce) 
For brands that have been exerting minimal effort in social media, it may be time to reach a little farther. Social media has changed marketing forever, and it's important to constantly be reevaluating where you are experimenting:

  1. Dedicate resources to social media measurement
  2. Consider social media advertising
  3. Tweak goals to better align with business objectives
  4. Ask your community for feedback
  5. Create a transition plan 

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Kleiner Perkins Caufield Byers partner and former analyst Mary Meeker published her latest report on the "State of the Web." Meeker believes the next 10 years in technology will be focused on wearable computing and personal data and that the rise of mobile will continue driving audience growth for social networks and e-commerce. Read >

Facebook Launches Verified Pages And Profiles (Facebook)
Following Twitter's lead, Facebook now offers verified Pages for prominent public figures and brands. Each verified page will display a "Verified" badge, so fans can differentiate between impostors and the real thing. For now, verified pages are only being rolled out to a "small group."Read >

BII mary meeker facebookFacebook Testing Poll Feature For Newsfeed Posts (All Facebook) 
Veteran News Feed users are spotting a new polling feature that asks how interesting they find content from pages users have liked (not from friends' content or user-generated posts). Read > 

Twitter Updates iOS and Android Apps (Mashable) 
With an update to its iOS and Android apps on Wednesday, Twitter improved the photo uploading experience and made it easier to switch between multiple accounts. When creating a new tweet, your avatar and username will now appear on the page, making it easier to differentiate which account you are about to tweet from. Read > 

BII twitter ios androidTwitter's Dick Costolo: We "Complement" TV, Not "Competing"(VentureBeat)
Twitter CEO Dick Costolo spoke on Twitter's relationship with TV at the D11 Tech Conference. "We view ourselves as complementary to what those folks are doing, and we try to create complementary experiences," Costolo said. Last week, Twitter announced a new television partnership, which advertisers can use to combine TV and Twitter ad campaigns. The rise of Twitter as a companion app to TV viewing is part of the so-called Second Screen phenomenon, via which TV audiences interact and comment on TV content via smartphone. Read >

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News Corp Sued Over 'I Will Destroy You!' Remark That Cost $655 Million (NWS)

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Rupert Murdoch

It's been 14 years since Paul Carlucci, the former publisher of the New York Post and now the CEO of News America Marketing, both owned by News Corp., said the words, "I will destroy you!" in a meeting with a company that was resisting a potential acquisition by News.

So far, those words — and many other actions and policies that Carlucci allegedly either signed off on, or turned a blind eye to — have cost News Corp. $655 million in legal fees.

Now a retirement provider, the Iron Workers Mid-South Pension Fund, has sued the company alleging its stockholding in News Corp. was damaged by the legal actions, which are ongoing, according to Courthouse News.

News was originally sued by a variety of companies in the grocery and supermarket coupon business. They alleged that News America Marketing, which controlled roughly half the coupon business at the time, engaged in unlawful anti-competitive practices to maintain its dominance.

News lost a string of suits on the issue, eventually settling tem all for $655 million. But once details of how News had restricted clients from obtaining more competitive deals leaked out, some of those advertisers sued News, alleging their own damages. Dial Corp.and Heinz have both sued News with suits derived from the original allegations.

The pension fund suit alleges that these new lawsuits mean that News has not closed the can of worms that was opened back when it was first sued, and may yet suffer more liabilities, further damaging its stock. It claims the company is still under federal investigation for allegedly hacking into the computers of a rival coupon company, for instance. So-called "derivative" suits from stockholders are common and often opportunistic among public companies.

The "I will destroy you!" quote has become infamous in the grocery business. It came at a lunch between executives of News America Marketing and Floorgraphics, another company that offered in-store ads inside supermarkets. Courthouse News says the meeting went badly:

"Defendant Carlucci made no secret that defendant R. Murdoch was personally instructing him to go after News America's competitors," the complaint states. "In fact, according to the founders of Floorgraphics, George and Richard Rebh, defendant Carlucci once told them, 'I will destroy you. I work for a man who wants it all, and doesn't understand anybody telling him he can't have it all.' The 'man' defendant Carlucci was referring to, of course, was defendant R. Murdoch."

The case was filed June 7. News Corp. did not immediately respond to a request for comment.

SEE ALSO: Look Which News Corp. Exec Got His Wings Clipped When 'The Daily' Closed

SEE ALSO: News Corp. Sues Heinz As Civil War With Its Own Advertisers Spreads

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The Crazy Story Of How Wendi Deng And Rupert Murdoch Got Together

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rupert murdoch wendi deng

News Corp CEO Rupert Murdoch just filed to end his 14-year marriage to Wendi Deng, a woman 38 years his junior.

The pair met in 1997 in China, where Deng is from. She started as an intern at News Corp-owned Star TV, and caught Murdoch's eye during a staff meeting in Hong Kong when she asked an intelligent question and approached him after the meeting, according to New York Magazine.

After that, in 1998, Deng worked as Murdoch's interpreter when he was in Shanghai and Beijing, according to The Wall Street Journal.

By that summer, there were rumors circulating at Star TV that the two were having an affair. In May, Murdoch separated from his then-wife of 31 years, Anna Torv, who, according to New York Magazine, suspected that Murdoch "had a girlfriend." 

Murdoch said he didn't start seeing Deng romantically until after he separated from Torv, but Torv insists that's a lie, according to New York Magazine.

In the fall of 1998, Murdoch informed top Star TV executives of his relationship with Deng. She then resigned from her job at Star TV and moved to New York with Murdoch.

Murdoch's divorce from Torv became final in June 1999 (it cost him $1.7 billion), and he married Deng on his yacht 17 days later.

If Deng was a factor in Murdoch's divorce from Torv, it wouldn't be the first time she was accused of breaking up a marriage.

In its 2000 profile of Deng, The Wall Street Journal reported that she was previously married to Jake Cherry, a man 30 years her senior. He and his wife Joyce, who were from L.A., met Deng in China in 1987 when they were there for work. Deng was looking for someone to tutor her in English, and Joyce took on the job.

Joyce eventually moved back to L.A., while Jake stayed in China to finish a factory project, according to the Wall Street Journal profile. Deng reportedly told them she wanted to come to the U.S. for school, and needed sponsors. Jake and Joyce helped Deng get a student visa and allowed her to live with them while she got acclimated in L.A.

But Joyce eventually grew suspicious of Deng's relationship with Jake, according to the Wall Street Journal. She found "coquettish" photos Jake took of Deng in his Chinese hotel room, and Jake admitted that he had become infatuated with Deng.

The couple divorced, and Jake moved into an apartment with Deng. The two married in 1990, and the union lasted two years and seven months, enough time to get Deng a green card, the Wall Street Journal reported. The marriage might have, for all intents and purposes, been over long before the divorce became final — Jake claims that he told Deng to move out four months after they got married.

SEE ALSO: The 17 Most Expensive Divorces Ever

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Rupert Murdoch's News Corp Reborn As Publishing Arm Targets Smartphones

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Rupert Murdoch Dow JonesNews Corporation, the newly devolved publishing division in Rupert Murdoch's global empire starts, launches on the New York and Sydney stock exchanges on Monday with the aim of dominating the smartphone market for news, entertainment and information.

Robert Thomson, the chief executive of new News Corp, told investors in Sydney the company would retain "Murdochian magic" and would have "a permanent startup sensibility" with globalisation and digitisation its biggest opportunities for growth.

"One of our foremost ambitions outside Australia is to own the second screen," he said in an investor roadshow whether this was "a football match or a British election".

He said the media sector was "still at the early stage of a second great migration, from print to web from web to mobile" and it was working on all fronts to make sure its newspaper content was a vibrant and appealing on smart phones.

In August the Sun hopes to make major inroads with the "second screen" when it starts charging customers £2 a week for online access. The company recently clinched a deal for exclusive rights to show Premier league highlights on the internet and mobile phones and is hoping this will getting Sun readers through its turnstiles.

Thomson said it is harnessing expertise from the TV side of the business as well as the Wall Street Journal to make sure the product is as distinctive as possible.

"We are working with Fox Sports and even the Wall Street Journal's quirky writers to develop a different kind of commentary for smartphones," he said.

He concerned that the newspaper business was lower yielding than the TV business and that the transformation into a digital growth business would "take longer than a couple of quarters".

"All investors should understand that context. We are also candidly and decidely optimstic and focused ... we are not here for the short term," he said.

Murdoch hopes to emerge with a new lease of corporate life in New York and Sydney when the $77bn global media company he has built over 60 years splits into two separate publicly listed companies with the newspaper business, tarnished by the phone-hacking scandal, finally separated from its big US TV and movie brands.

The demerger is the culmination of a two-year campaign to "detoxify" the News Corp brand that started in the summer of 2011 with the abrupt closure of the News of the World and finished with the announcement in the last week that News International's brand in London would be axed and the company rebranded News UK.

Overall the publishing company will continue to be called News Corp and will be home to 130 newspaper titles around the world, the new education business Amplify, the HarperCollins publisher, the Australian TV business, the Australian online property company REA and a US inserts business.

The addition of the non-press business has given some added appeal to the publishing spin-off which was unkindly dubbed "crap co" because of the loss-making newspapers. Times Newspapers Limited, which includes the Times and the Sunday Times, made a loss of £28m in the year to July 2012 according to its most recent results. Although this included a substantial £12m restructuring cost, the daily paper still loses money while it is understood that the Sunday Times is returning to profit.

The closure of the News of the World also added financial costs to the other titles - sources say some a £40m deficit was initially shared among the titles as a result of the shutdown.

To further the appear of News Corp, the company is receiving a $2.6bn (£1.7bn) dowry as part of the demerger. Some $500m is earmarked for share buybacks in the event of investors ditching stock, while the rest is expected to be invested in developing newspapers' digital operations and to fund possible acquisitions, with many suggesting that Murdoch may yet try to realise a dream by acquiring the Los Angeles Times.

Murdoch told investors at the same roadshow last month in Sydney ahead of the demerger that the split gave him an opportunity "most people don't get in their lifetimes – the chance to do it all over again".

One analyst and keen Murdoch-watcher who asked not to be named believes that the tycoon will have to come up with something transformational such as a tablet giveaway if he is to repeat the success he had with the relaunch of the Sun in the 1970s or the launch of Sky TV in the 1990s.

The tablets would be pre-loaded with newspaper apps and could be funded by the entire industry.

Thomson said the new company would continue to have "Murdochian magic, a permanent start-up sensibility" which would take risks and follow its instincts.

Thomson has also told investors the company will start charging third parties for use of its readership and subscriber data and will be looking to "window" content in the same way the movie industry does with higher charges for first sight of stories and video.

The notion of charging for data was rubbished by one analyst in New York who pointed out newspapers do not know who their readers are in the same way as Google or Facebook and don't have the information to sell. "They are using big data as a buzzword to get us all excited," he said. The same banker was sceptical about the notion of "windowing": "You pay for freshness, but if he's talking about news, that's all over Twitter within seconds, it's a bit of a pipe dream."

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This article originally appeared on guardian.co.uk

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How 'The New Yorker For Tech Geeks' Has Survived A Year On Apple's Newsstand

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marco arment glenn fleishmanThe world of publishing is currently going through a major period of change. Publishers are constantly starting up, closing, or trying out some new business model.

When Rupert Murdoch's News Corp. launched the iPad-only newspaper "The Daily" back in 2011, many in the media business thought they saw a potential future model to follow. It combined the traditional daily newspaper with the multimedia capabilities of web apps and packaged them into a slick format designed for the iPad.

When The Daily closed in late 2012, we saw that there were some fundamental problems with the technical and business aspects of the publication.

While the app was convenient to download and subscribe to via Apple's Newsstand, individual issues required massive downloads. The publication's 100,000 paid subscribers weren't even close to the the 500,000 needed to break even, and that's with advertising revenue to boot.

The failure of The Daily provides an interesting perspective with which to look at another publication on Apple's Newsstand: The Magazine, which "publishes five medium-length articles every two weeks on a wide variety of subjects of interest to curious people."

Announced a year ago this week by Marco Arment, the first employee at Tumblr and creator of the Instapaper app, The Magazine has thrived by taking a "subcompact" approach to publishing.

There are no staff writers at The Magazine — all articles are pitched to the editors on a freelance basis and approved writers are paid $800 plus expenses incurred while reported. As opposed to The Daily's media-rich layout, reading articles in The Magazine is akin to reading an article saved in a read-later app like Pocket or Instapaper.

And unlike media outlets that try to crank out as much content as possible, The Magazine has strictly stuck to its pace of five articles every two weeks. According to Glenn Fleishman, The Magazine's owner and editor, that's because people prefer a number of articles that they can casually read through before the next issue.

"It's like people who subscribe to The New Yorker and have stacks of issues sitting around the house," he says. "People get stressed out when they feel they have to finish all of the articles."

This isn't the first comparison Fleishman has made between The Magazine and The New Yorker. Fleishman, who has been executive editor at the publication since the beginning and purchased it outright from Marco Arment earlier this year for an undisclosed sum, claims that the publication aims to be "The New Yorker for tech geeks." 

That isn't to say that The Magazine is just another source of tech news and reviews. Instead, many of its articles tell the tales of interesting individuals and their obsessions — from a guy who's building an accurately-scaled Millenium Falcon from Star Wars (but happens to live a pretty normal life outside of his hobby) to a visit to a historical site that details how difficult it really is to teach the realities of life hundreds of years ago.

These individuals may not be obsessed with the same topics as The Magazine's audience, but that's okay. What's important is how they think about the subjects that are important to them. Any tech geek who's spent hours comparing gadgets online when trying to make a buying decision can sympathize with the guy who obsesses over finding the best method to remove the air bubbles from the ice he puts in his drinks.

Whereas The Daily blew through about $500,000 per week while it was being published, articles in The Magazine cost about $2,000 each when all factors are accounted for — the writer's fee, expenses, photography or illustration, and editing. All told, that brings the overall costs at The Magazine to roughly $20,000 per month. 

The relatively low cost to run The Magazine means that it can charge fewer subscribers less money and still be sustainable. Subscribers pay $2 per month or $20 per year and the app contains no advertising, though Glenn notes that he won't rule out the possibility that it could one day make an appearance.

While this model has proven sustainable, it does have a few downsides. There are a number of technical features that Glenn and The Magazine's readers would love to see, like the ability to search articles within the iOS app or to highlight older articles for new subscribers to read, that simply aren't feasible to implement right away on its shoestring budget. 

As Mr. Fleishman points out, he's not an iPhone/iPad developer. While Marco Arment already had quite a bit of experience with developing apps centered around reading thanks to his work on Instapaper, Glenn has to bring in an outside contractor when he wants to roll out new features. This means that features have to be planned out far ahead of time and implemented when they can.

That isn't to say that the model doesn't allow for experimentation. Beginning with this week's anniversary issue, The Magazine is partnering with Boing Boing, an independent blog and "Directory of Wonderful Things."

An article from each new issue of The Magazine will also run on Boing Boing. This arrangement works out for both sides — The Magazine gets more exposure, and Boing Boing gets a cheap source of high-quality, medium-length content. Fleishman declined to comment on whether either side receives payment for this arrangement.

The Magazine's barebones approach isn't the sexiest out there. It doesn't integrate video, audio, or advanced social media functions. It doesn't bring in millions in advertising revenue. But bloggers, especially those that are generally considered part of the "Apple blogosphere," can't get enough.

That's why Jim Dalrymple, the Apple blogger best-known for confirming company rumors with a simple "Yep," started a similar magazine of his own back in May. To build it, Dalrymple used TypeEngine, a software kit that removes many of the technical hurdles for creating a magazine for Newsstand.

It's not just the format that appeals to these bloggers — notably, one of the templates available within TypeEngine is an almost-exact replica of the layout used by The Magazine.

The flashy, bold approach News Corp took with The Daily looked like a winner upon its release. In reality, The Magazine shows us that while people love video and breaking news, there's room in people's schedules (and budgets) for something a bit more "literary," something that you can sit down and read when the the endless stream of news and content from Twitter is too much. 

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News Corp Buys Storyful, A Site That Finds News Stories On Social Media, For $25 Million

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robert thomson news corp

News Corp announced today that it bought Storyful, a startup that finds news on social media, for $25 million.

Here's the release:

Accelerating News Corp’s digital transformation and video strategy, the company has acquired Storyful, the world's first social news agency.

Building on Storyful's skill in finding verified news amidst the noise of social media, News Corp will use its own global scale, robust digital presence and advertising expertise to enhance and expand Storyful's video products and services for newsrooms, advertising agencies and brands. News Corp will also utilize Storyful’s tools to help drive engagement and revenue across News Corp’s businesses.

Storyful, acquired for €18 million (approximately $25 million USD), will operate as a stand-alone business unit within News Corp and continue to work with its existing roster of global customers, which includes The Wall Street Journal.

"Storyful has become the village square for valuable video, using journalistic sensibility, integrity and creativity to find, authenticate and commercialise user-generated content,” said Robert Thomson, Chief Executive of News Corp. “Through this acquisition, we can extend the village square across borders, languages and platforms.”

The acquisition complements News Corp’s existing video capabilities, which include the creation and distribution of original and on-demand programming, such as WSJ Live and the recently launched BallBall in Asia.

The Dublin, Ireland-based start-up discovers, verifies, acquires and distributes timely and relevant video and user-generated content to its partners. With its combination of proprietary technology and journalistic expertise, Storyful also provides social media dashboards, real-time discovery tools, feeds and analytics to its customers, allowing them to integrate video into their news or advertising efforts via online and mobile platforms and to monitor social conversations and sentiment. So far in 2013, verified user-generated videos managed by Storyful generated 750 million views for its partners.

Added Mr. Thomson, “Video is a vocation for the new News, which will combine with Storyful to reach a growing global audience, enhancing our own editorial products and creating new content communities."

Storyful’s management team of Chief Executive Officer Mark Little and Executive Editor David Clinch will continue to oversee the company’s operations. Rahul Chopra, Senior Vice President of Video for News Corp, will join the Storyful management team, taking on the additional role of Chief Revenue Officer. Mr. Little will report to David Brinker, News Corp Senior Vice President and Global Head of Business & Corporate Development.

“By joining forces with News Corp, Storyful can quickly transform its vision into a global reality,” said Mr. Little. “We believe that journalism in the age of social media needs to be open, innovative and collaborative, and so does the business model that will sustain it. News Corp is a natural fit for a company which wants to help reinvent the news industry.”

Storyful remains headquartered in Dublin, where the company was founded in 2008. Additional business development and advertising sales staff will be hired and based in New York.

Investors include Ray Nolan, one of Ireland’s leading entrepreneurs; SOS Ventures; the Irish State Enterprise Board; ACT Ventures; as well as Mr. Little.

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FOX Just Bought A Controlling Stake In The Yankees' Cable Channel

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21st Century Fox just acquired a controlling interest in YES Network, the Yankees cable channel.

21st Century Fox is part of the Rupert Murdoch empire.

It's one of the two companies that came out of the 2013 News Corp split up. 

(21st Century Fox is the TV and film company. News Corp owns the newspapers.)

FOX previously owned 49% of YES. Now it owns 80%.

Here's the press release:

NEW YORK-- 21st Century Fox (NASDAQ: FOX, FOXA; ASX: FOX, FOXLV) today announced an agreement to acquire a majority stake in the Yankees Entertainment and Sports Network (YES Network), raising its ownership position in the regional sports network to 80 percent from the current 49 percent it acquired in 2012. The YES Network delivers exclusive live local television coverage of New York Yankees baseball and Brooklyn Nets basketball, as well as other Emmy Award-winning local and national sports programming. The acquisition is expected to close by the end of the first calendar quarter, subject to regulatory and other requisite approvals.

21st Century Fox also announced that, following the acquisition, Tracy Dolgin, President and Chief Executive Officer of the YES network, will remain in his role leading the network.

The remaining 20 percent stake will continue to be held by Yankee Global Enterprises. As a result of the acquisition, the YES Network will become a consolidated entity of 21st Century Fox.

Since its inception in 2002, the YES Network has grown its footprint to include local availability in New York, Connecticut, New Jersey, and parts of Pennsylvania, as well as national availability on several cable and satellite television distributors. The network currently showcases live Yankees and Nets games to approximately 9 million households in the teams’ television territory in the New York area. Outside of the New York area, the YES Network also distributes a variety of national programming to millions of homes across the country.

“Our investment in the YES Network underscores our commitment to growing our global sports portfolio with offerings that are exceptional and unique,” said James Murdoch, Deputy Chief Operating Officer, 21st Century Fox. “We look forward to expanding our partnership with Yankee Global Enterprises and to working with the network’s management team to build on the YES Network’s success.”

Hal Steinbrenner, chairman of Yankee Global Enterprises, said, “Clearly, 21st Century Fox is a great partner for us as the YES Network fulfills and expands its potential as one of the nation’s premier regional sports networks. We are gratified that 21st Century Fox has increased their stake and investment in the network. Yankee Global Enterprises is eager to continue working with 21st Century Fox as we explore ways to take YES to even greater heights.”

Fox Sports Media Group is the nation’s leader in local regional sports programming, operating a leading array of 22 owned-and-operated U.S. regional sports networks, which collectively produce over 5,000 live local events each year and serve as the local TV homes to more than half of all MLB, NHL, and NBA teams.

About 21st Century Fox

21st Century Fox is the world's premier portfolio of cable, broadcast, film, pay TV and satellite assets spanning six continents across the globe. Reaching nearly 1.5 billion subscribers in more than 100 local languages every day, 21st Century Fox is home to a global portfolio of cable and broadcasting networks and properties, including FOX, FX, FXX, FXM, FS1, Fox News Channel, Fox Business Network, Fox Sports, Fox Sports Network, National Geographic Channels, MundoFox, STAR, 28 local television stations in the U.S. and more than 300 channels that comprise Fox International Channels; film studio Twentieth Century Fox Film; and television production studios Twentieth Century Fox Television and Shine Group. The Company also provides premium content to millions of subscribers through its pay-television services in Europe and Asia, including Sky Deutschland, Sky Italia and its equity interests in BSkyB and Tata Sky. For more information about 21st Century Fox, please visit www.21CF.com.

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