Rupert Murdoch began Fox Corp.’s investor day, appearing solo onstage to emphasize the effectiveness of the company’s evolution.
The architect of the Fox empire said that even before the milestone Disney deal, which closed in March, Fox was “pivoting at a pivotal moment while staying true of course to our principles and our purpose.”
In recent years, he said, “Our efforts have been focused on simplifying our structure.” The Disney deal, which involved the transfer of two-thirds of the company, “gave us the opportunity to create a more focused company.”
Lachlan Murdoch, executive chairman and CEO of Fox, said the company is “returning to its roots” and is positioned “at the apex of our peers in the media business.”
He described the company’s run over three-plus decades as a hand-crafted affair. “Our assets, except for the stations, were built from the ground up,” he said. Post-merger, the company consists of the Fox broadcast network, Fox News, Fox Sports, cable networks FS1, FS2 and Fox Business, and 28 local TV stations.
A reunion with News Corp., the parent company of the Wall Street Journal and other news assets spun out in 2013, is not in the cards, he said. Throughout his remarks, Lachlan Murdoch emphasized the advantages of the company’s leaner structure. The company’s new composition is “insanely simple,” he said, deriving revenue from affiliate relations and advertising in almost equal proportion. The separation of Fox’s broadcast network from its studio supplier is not a disadvantage, he argued. Instead, it changes Fox from a “supply-driven programmer” to a “demand-driven one” with about 70% of its overall air time focused on news, sports and other live fare.
COO John Nallen echoed sentiments from the Murdochs, disputing a scenario bandied about since the Disney deal by analysts and media observers. In slimming down, the thinking goes, Fox is out of step with rivals getting larger and is likely to merge with another entity in order to be able to compete.
“We’re not running this company to sell it,” Nallen asserted. “We’re running it for growth.”
While the company is not mounting a comprehensive direct-to-consumer streaming offering, as are Disney, WarnerMedia and NBCUniversal, Fox’s properties have been key ingredients in skinny bundle services. Even if consumers cut or shave the cord, Nallen argued, they can still subscribe to the Fox Nation streaming service or a cheaper, Internet-delivered bundles that feature Fox properties.
The investor day is slated to be a four-hour tour through the new company, with presentations scheduled by the heads of Fox TV Stations, Fox Sports, Fox News and Fox Broadcasting. Other executives are speaking to the company’s financials and operations.
On Wednesday, Fox announced third-quarter results that exceeded Wall Street expectations.