News Corp chairman Rupert Murdoch has promised to start charging for online content across his company’s news sites as it reported a $3.4bn on-paper loss for the year to June.
Murdoch said today: “Quality journalism is not cheap. The digital revolution has opened many new and inexpensive distribution channels but it has not made content free. We intend to charge for all our news websites.”
Murdoch’s announcement will affect the websites of The Sun, News of the World, Times and the new stand-alone Sunday Times website which is currently being launched.
News Corp‘s $3.4bn loss for the full financial year compares with a net profit of $5.4bn a year previously.
But the loss is almost entirely due to an “impairment charge” of $8.9bn which relates largely to the reduction in market value of media businesses.
Excluding impairment charges, the company reported adjusted operating income for the last quarter of $948m, compared with $1.4bn a year before.
Looking at the full year, News Corp reported adjusted operating profit of $3.6bn on turnover of $30bn compared with a profit figure of $5.3bn on turnover of $33bn in the previous financial year.
Murdoch said: “The past year has been the most difficult in recent history, and our 2009 financial performance clearly reflects the weak economic environment that we confronted throughout the year.
“We streamlined all our businesses and continue to do so, at the same time adjusting to the revolutionary changes taking place throughout the media industry.”
He said: “I am certain that News Corporation is poised to profit, and deliver strong returns, as the economy rebounds.”
Adjusted operating profit from News Corp’s newspapers and information services around the world was $466m on revenue of $5.9bn compared with $786m on revenue of $6.2bn in the previous financial year.
At News International, News Corp’s UK newspaper group which includes The Sun, News of the World, Times and Sunday Times, advertising was said to be 18 per cent down in the fourth quarter.
In the US, lower advertising revenue at the Wall Street Journal led to lower profits despite cost-cutting and increased circulation revenue driven by price rises.