The disappointing performance of movies including The Secret Life Of Walter Mitty, Walking With Dinosaurs, Runner Runner, and The Counselor still weighs on investors when they look at 21st Century Fox. But while Co-COO James Murdoch acknowledges that “last year we didn’t have a great run” in theatrical films, he told the Sanford C. Bernstein Strategic Decisions Conference this morning that “over time the film segment is very attractive” — and promised an “exciting next couple of years” with “a lot of attractive film product coming through…. We’re super excited about the future.” The studio has “very high hopes” for The Fault In Our Stars, which he described as “a lower cost drama.” Murdoch also talked up planned sequels for The Planet Of The Apes and Avatar, as well as recent successes with Rio 2, The Other Woman, Grand Budapest Hotel, and X-Men: Days Of Future Past. “You have to look at the film business over a multi year perspective….Somethings just aren’t going to work and you aren’t going to bat 1000.” Murdoch also noted that about half of his studio’s cash flow comes from television series. “There’s maybe one other firm that can claim the same volume and success” that Fox has had in TV. That makes the combined operation “one of the most attractive businesses we have.”
Murdoch also defended Fox’s investments in sports TV, including the launch of Fox Sports 1. Although licensing rights are expensive, “we try to make choices” to avoid boondoggles. For example, Fox walked away from the competition for Italy’s Champions League — and for the Los Angeles Dodgers. It was “too rich and we made the call. We don’t need this…..This is something you have to think hard about.” He’s more enthusiastic about Fox’s acquisition of the New York Yankees’ YES Network and “the premium nature of the franchise.”
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