Twenty-First Century Fox 2011 Annual Report Download - page 9

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2011 Annual Report 7
We have a strong relationship with the NFL, and our television ratings in general have
been incredible, with viewership up 5 percent over last year.
Simply put, there is no better place to draw an enormous audience than broadcast
television. Sporting events in particular deliver the mass audience that advertisers crave,
with a very predictable and desirable demographic. These events are also relatively
DVR-proof and will remain a critical driver of our growth.
Leading Franchise in Filmed Entertainment
Sometimes, our biggest competition is ourselves. Our Filmed Entertainment segment,
for example, experienced a difficult comparison to the prior year’s groundbreaking
blockbuster, Avatar, and the very popular Ice Age: Dawn of the Dinosaurs. As a result,
earnings were down 31 percent year over year. Even so, the animated Rio has generated
more than $475 million in worldwide box office. And the summer got off to an impressive
start with X-Men: First Class, which achieved $350 million in worldwide box office. As
I write this letter, Rise of the Planet of the Apes is off to a strong start with worldwide
grosses topping $250 million. We are confident in our slate of upcoming films. Looking
out at the longer term, we believe this segment will see more opportunity to profit not
only from growth in international markets, but also from the roll-out of new electronic
distribution technologies everywhere.
One of the brightest spots in this segment was our television production business.
Here we outperformed our expectations – led by results from hit shows such as Glee
on FOX and Modern Family – and burnished our reputation as an industry leader.
We are also excited by the opportunities Netflix and other emerging platforms are
creating for new and incremental sources of revenue for library rights to our shows.
We incessantly monitor this changing landscape to ensure the windowing of our
products aligns with the needs of both our consumer and business partners, and to
protect the value of our series. We remain confident about our current approach.
Growth on Pay-TV Platforms
At our Direct Broadcast Satellite Television segment, satellite pay-TV platforms
continued to focus on growth as they strengthened their competitive positions. At Sky
Italia, these efforts are paying off: last year the number of subscribers increased by
230,000 – and we expect the total number of Sky Italia subscribers will very soon pass
the five million mark, an important milestone.
In Germany, our investment, Sky Deutschland, also showed steady and substantial
improvements across key metrics like subscriptions and churn rate. And our joint venture,
Tata Sky, which operates in the highly competitive Indian market, has increased its
subscriber base to record levels. Each is now in its strongest competitive position ever.
We are proud of our performance. By renewing our focus on technology, content and
service, we believe we have positioned this segment for strong, continued growth.
News Corporation
leads because we
attract and retain
experienced and
talented people
who have proven
themselves
exceptionally
prescient
in determining
consumer tastes
and expectations.