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NEWS CORPORATION
Notes to the Consolidated Financial Statements (continued)
Note 14 Related Parties
Director transactions
Mr. Shuman served as a non-executive Director of the Company through October 2005 and was named Director Emeritus effective
October 2005. He is also the Managing Director of Allen & Company LLC, a U.S. based investment bank. In fiscal 2006, total fees
paid to Allen & Company LLC were $6.1 million. There were no fees paid to Allen & Company LLC in fiscal 2007 or fiscal 2005.
Mr. Aznar, a Director of the Company, holds a 50% interest in Famaztella S.L. (“Famaztella”), a private consulting firm, which
provided advisory services to the Company related to its global corporate strategy. Since September 1, 2004, Famaztella received
€10,000 per month for its services. The consultancy agreement between Famaztella and the Company was terminated on June 20,
2006, immediately preceding Mr. Aznar’s appointment to the Board.
Freud International LLP, which is controlled by Matthew Freud, Mr. K.R. Murdoch’s son-in-law, has provided external support to
the press and publicity activities of the Company during fiscal year 2007 and 2006 amounting to approximately $500,000 in each
year. At June 30, 2007, there were no outstanding amounts due to or from Freud International LLP. Freud International LLP did not
provide any services to the Company prior to fiscal 2006.
The Company has engaged Mrs. Wendi Murdoch, the wife of Mr. K. Rupert Murdoch, the Company’s Chairman and Chief
Executive Officer, to provide strategic advice for the development of the MySpace business in China. The fees paid to Mrs. Murdoch
pursuant to this arrangement are $100,000 per annum and Mrs. Murdoch received $83,333 in the fiscal year ended June 30, 2007.
Mrs. Murdoch is a Director of MySpace China Holdings Limited (“MySpace China”), a joint venture in which the Company owns a
51.5% interest on a fully diluted basis, which licenses the technology and brand to the local company in China that operates the
MySpace China website. As a Director of MySpace China, Mrs. Murdoch will receive options over 2.5% of the fully diluted shares of
MySpace China that will vest over four years under the MySpace China option plan. There were no fees paid to Mrs. Murdoch in
fiscal 2006 or fiscal 2005.
SMS TV, which is controlled by Ms. Elisabeth Murdoch, the daughter of Mr. K.R. Murdoch, was a party to a production agree-
ment with the Company, for programming that is distributed on the Company’s owned-and-operated television stations. Under a
revenue sharing arrangement provided under the terms of the production agreement, SMS TV received approximately $300,000 in
the fiscal year 2007. The production agreement was terminated by the Company during fiscal 2007, and the parties are negotiating
a termination fee to be paid by the Company to SMS TV.
Other related entities
In the ordinary course of business, the Company enters into transactions with related parties, such as equity affiliates, to purchase
and/or sell advertising, the sale of programming, administrative services and supplying digital technology and services for digital pay
television platforms. The following table sets forth the net revenue from related parties, excluding transactions with QPL, included
on the consolidated statement of operations:
2007 2006 2005
For the years ended June 30, (in millions)
Related party revenue, net of expense $1,173 $1,143 $1,008
The following table sets forth the amount of accounts receivable due from and payable to related parties outstanding on the con-
solidated balance sheets:
2007 2006
As of June 30, (in millions)
Accounts receivable from related parties $389 $371
Accounts payable to related parties 15 38
Liberty Transaction
In December 2006, the Company entered into the Share Exchange Agreement with Liberty. Under the terms of the Share Exchange
Agreement, Liberty will exchange its entire interest in the Company for 100% of Splitco, whose holdings will consist of an approx-
imate 39% interest in DIRECTV, the Three RSNs and $588 million in cash, subject to adjustment. As of June 30, 2007, Liberty’s
economic equity ownership in the Company was approximately 16% and its voting interest was approximately 19%. (See Note 3—
Acquisitions, Disposals and Other Transactions for further discussion of the Share Exchange Agreement.)
NEWS CORPORATION 2007 Annual Report 97