UPDATE, 3:15 PM: Add NewsCorp COO Chase Carey to the list of executives of studio owners who characterize Premium VOD as merely a test that shouldn’t hurt theater owners. In a quarterly earnings conference call with analysts and reporters, Carey said that Fox and other studios are beginning to offer 8-week-old movies to cable and satellite VOD because they had little choice: Services such as Netflix and Redbox are renting DVDs for as little as $1 a night “and that doesn’t work,” Carey says. “We have to build appropriate values and windows into our business.” Fox is “in the very early stages (of the P-VOD trials) with one small film.” He doesn’t want it to affect exhibition chains because they “set the pace for the film industry.” Still, he hedged when asked whether Fox would let exhibition companies see how well P-VOD movies perform — something that the National Association of Theater Owners says it wants. Carey says he “doesn’t know what request has been made,” although he adds that it’s “important for everyone to understand what’s going on.” 

Carey was equally opaque in response to other questions. He says he’s optimistic that Fox News will collect much higher fees from cable and satellite companies as they negotiate new carriage contracts leading up to the 2012 election. How much higher? “I’m not going to advertise what we’re looking to achieve,” Carey says. What will happen to Fox if there’s no NFL season as a result of the contract dispute between team owners and players? “We’ll have to play this out as it goes.” What kind of content will he sell to online streaming services led by Netflix? “We have a clearly defined view of what should be sold in one place and what should be sold in a different place.” Will Fox hold back ad inventory for The X Factor — the new talent contest that Simon Cowell is preparing — hoping the network can charge higher prices if the show becomes a hit? “You can be sure we’ll have unique strategies.” How many iPad owners who received the new digital publication The Daily for free became paid subscribers? “We’re just a month into this,” he said. “There are a lot of moving parts here.” He did say, though, that start-up costs for The Daily cost News Corp about $10 million in the quarter that ended in March.

PREVIOUS, 1:40 PM: The absence of Avatar‘s profits along with the inclusion of expenses for publishing initiatives such as The Daily made the quarter that ended in March one that News Corp probably would like to forget. Net income at $639 million was down 23.8% vs. the same period last year on revenues of $8.3 billion, down 6%. The earnings figure translates into 24 cents a share, less than the 25 cents analysts expected. But the official results include a $125 million litigation settlement charge for News Corp’s Integrated Marketing Services business, part of the publishing unit. Without that, earnings would have been 26 cents. Revenues at Fox television were up 23% to $1.4 billion helped by NFL playoff games and the Super Bowl — as well as the stronger ad market. The company also says that costs were down at American Idol. And at the cable networks, revenue increased 13% to $2 billion with stronger ad sales and higher license fees from cable and satellite companies.

More to come after the company’s quarterly conference call with analysts and the press.