News Corporation is the latest international media company to reveal that it has been hit hard by COVID-19, with third-quarter accounts showing a $US1 billion ($1.5 billion) loss.
It is a setback that spurred Rupert Murdoch to join the growing list of senior executives forgoing their bonuses for this year.
But while the US, like the rest of the world, is feeling the heat from COVID-19, much of News Corp’s pain came from Australia.
As the owner of 65 per cent of pay TV operator Foxtel, News Corp’s accounts give an insight into how Foxtel is travelling.
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And it’s not pretty.
“In one, two, three years, then either they totally change their business model and become like another Netflix, or, you know, another model that they may think of, otherwise I don’t think they will survive for much longer.”
As Virgin Australia found out a few weeks ago, when shareholders stop stumping up the cash for a loss-making business, the consequences are dire.
It beggars the question of just how many more $1 billion-plus writedowns Mr Murdoch is prepared to tolerate
Rupert Murdoch’s News Corporation is on the slide, once again reporting a loss – $306.7 million for the September quarter – in stark contrast to its $186 million positive result at the same time last year.
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Rupert Murdoch’s News Corp has handed Foxtel a $300 million lifeline, without backing from fellow shareholder Telstra, amid further signs of weakness for the pay TV provider.
News Corp, which owns 65 per cent of the pay TV provider, used its own balance sheet to provide Foxtel with a $300 million shareholder loan to cover debts maturing in April.