21st Century FOX 4Q14 Earnings Call Notes

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This post is part of a series of posts called “Company Notes.” These posts contain quotes and exhibits from earnings calls, conference presentations, analyst days and SEC filings. Full transcripts can be found at Seeking Alpha

Foreign currency and ad spending

“Reality is that the majority of our businesses and key initiatives are on track and our competitive position is strong as ever in most every area. However, two issues, foreign currency and broadcast advertising shortfall simply became too large to offset.”

broadcast network ads and ratings down

“On the broadcast side network and stations, the issue was primarily entertainment rating shortfalls at our network exacerbated by adverse industry trend in linear network ratings and the television advertising markets, which combined leave our expected ad revenues well short of plan.”

Digital transition is glass half full

“Turning to the broader industry issues, the digital transition continues to be a glass half full story for us. The moment of advertising dollars and shift of our consumer viewing is clearly going to continue as I think it’s fair to say that its trend recently has been in a bit faster than many expected. These issues will put short term pressure on our business but represent longer term exciting growth opportunities, it will able to deliver more efficient and effective capabilities to advertisers that will monetize viewership on digital platforms and create new offer for consumers on these platforms.”

Trying to figure out how to monetize streaming still

“Really at the forefront of thinking around how you monetize digital viewership, how you monetize time shift to viewership. And as we see the steaming share of time shifted viewing continue to grow vis-à-vis DVRs, really you have to remember that we’re really just in the very, very foot hills in monetizing that viewership and that viewership is very, very larger to material percentage above what our life plus 3 or life plus 7 viewing is. So it’s really about monetizing the streaming environment and being able to accelerate with new ad product for other broadcasters as well as for our self, but there will be more on that going forward.”

How they’re thinking about SVOD

“I think from the get go, our approach to the SVOD space Netflix in particular and specifically the SVOD space in general has been to disciplined about it to make sure we participate in that business by adhering to sort of rules that first and foremost defend the value enable us continue to grow our core businesses which is the networks and make sure we are large our overall time and not cannibalizing our core business in an adverse way for the spend to the extent of short terms dollars.”

SVOD is getting more competitive

“In reality, our recent SVOD have been actually with the Amazon and Google Plus, so I think that’s a positive that you got more competitive marketplace than you’ve had.”