Anticipating big ad revenue, Murdoch says he expects to drop subscription fees wsj.com
11/13/2007ADELAIDE, Australia - News Corp. Chairman Rupert Murdoch said Tuesday he intends to make access to The Wall Street Journal's Web site free, trading subscription fees for anticipated ad revenue.
"We are studying it and we expect to make that free, and instead of having one million (subscribers), having at least 10 million-15 million in every corner of the earth," Murdoch said.
News Corp. has signed an agreement to acquire Dow Jones & Co., and the deal is expected to close in the fourth quarter. A special shareholders meeting is scheduled for Dec. 13 in New York.
Murdoch said he believes that a free model, with increased readership for wsj.com, will attract "large numbers" of big-spending advertisers.
The Web site, one of the few news sites globally to successfully introduce a subscription model, currently has around 1 million subscribers, which generates about $50 million in user fees.
Murdoch, speaking to shareholders in Adelaide, where he started his company from one newspaper that he inherited from his father, said that the company in the October-December quarter is performing ahead of full-year guidance, and that U.S. advertising demand has held up well despite problems in the U.S. credit market.
"This quarter ... we are going very well and very strongly," Murdoch said.
He said it was too early, however, to raise forecasts for the year and reiterated guidance for operating income growth in the low double digits.
The group hasn't been affected by any of the issues which precipitated the U.S. subprime mortgage market meltdown earlier this year, he said. Even if the advertising market were to be hit, the impact at the group level wouldn't be huge, he said.
Around 23 percent of News Corp.'s earnings come from the United States. Murdoch said it wouldn't be "fatal" to see a 10 percent drop in advertising in the U.S. market as a whole.
In addition to Dow Jones Newswires, Dow Jones publishes The Wall Street Journal and its international and online editions, Barron's, the Far Eastern Economic Review, MarketWatch, Dow Jones Indexes and the Ottaway group of community newspapers.
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