Twenty-First Century Fox 2005 Annual Report Download - page 9

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channels, providing an immediate 15 million subscribers at launch. And the cooperation between
Fox and DIRECTV in areas such as NFL broadcasts will lead to several ground-breaking interactive
advances in the coming season.
In the U.K., our 37 percent-owned BSkyB expanded its DTH subscriber base by 6 percent
to 7.8 million this past year while revamping its pricing and package structure to offer consumers
increased choice and flexibility. As the number of subscribers increased – a number expected to
exceed 8 million by the end of calendar 2005 – the number of multi-room households also
rose, more than doubling this past year and providing a strong boost to average revenue per user.
As you know, we have long been big believers in the potential for satellite to deliver
a top-quality and innovative service to customers around the world. Fiscal 2005 showed that
our predictions were justified.
While the development of our newer satellite assets continued apace, few would have
predicted the exceptional growth we achieved at our print assets, especially among our newspapers.
At the Newspapers segment, operating income was up 31 percent on the year, to $740
million. Our Australian papers delivered record profits during fiscal 2005, with the inclusion of
100 percent of the results of Queensland Press, and with advertising revenues benefiting from
the strong local economy. We also grew our market share at several of our U.K. newspapers,
including The Times, which shifted fully to a compact version that consumers and advertisers
alike prefer, and at the New York Post, which posted its ninth consecutive six-month period of
daily circulation growth.
In the past year we also made long-term capital investments in our Australian properties
to increase their color capacity and we are in the process of undertaking an even greater expansion
in the U.K. where we have begun a five-year effort to build modern new plants and buy new color
printing presses to serve our papers and enable large wage savings.
We also achieved growth across our other print assets. HarperCollins enjoyed another
year of record profits – all the more remarkable this year considering the enormous gains made
a year ago, spurred by the runaway success of The Purpose Driven Life. And our Magazines and
Inserts segment grew operating income 10 percent, led by continued growth in our InStore division.
Our publishing assets are major
cash generators for our Company, cash that
enabled us to develop new businesses.
Given that they are the foundation of our
Company, I was extremely pleased with
their performance in the past year.
Across the board in fiscal 2005, our
established businesses performed admirably
in the face of many challenges and our
developing businesses made great strides
towards sustained growth and profitability.
It was, as I said earlier, a record year. But to maintain our steep growth trajectory, we must
continue to develop new assets in new areas. To that end, we have spent the past six months
focusing on reformulating our Internet strategy. The shell-shock of the dot-com bubble is
dissipating and smart companies are realizing that the digital revolution is only accelerating. The
achievers in the digital age are going to be those who fashion their Internet presence in line with
the expectations of their increasingly web-savvy customer base – especially the “digital natives,”
as I called them earlier this year in a speech I gave to the American Society of Newspaper Editors.
In that speech I acknowledged that more and more young people are embracing the Internet as
NEWS CORPORATION Chief Executive Officer’s Review
> Across the board in fiscal 2005, our
established businesses performed
admirably in the face of many challenges
and our developing businesses made
great strides towards sustained growth
and profitability.