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News Corp flags more job cuts after posting l -

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Reporter: Michael Rowland

BRENDAN TREMBATH: Overseas, News Corporation is flagging further job cuts across its TV stations
and newspapers after posting a quarterly loss of nearly $10-billion.

The chief executive Rupert Murdoch says it's the worst global economic crisis since he founded the
company more than 50 years ago.

And he believes Australia has only just started to feel the effects.

North America correspondent Michael Rowland reports.

MICHAEL ROWLAND: News Corporation earnings reports are usually a platform for Rupert Murdoch to
boast about the success of his media empire.

Not this time.

RUPERT MURDOCH: The results Dave just outlined are a direct reflection of a recession that is
deeper than anyone predicted.

Indeed it is the worst global economic crisis we have witnessed since News Corp was established
more than 50 years ago.

MICHAEL ROWLAND: News Corp lost $9.8-billion in the final three months of last year.

This compares to a $1.2-billion profit in the same period in 2007.

The company's also reported a substantial half-yearly loss.

News Corp's balance sheet has been hit by asset write-downs of nearly $13-billion relating to its
TV stations and newspapers.

Like every other media company around the world, News Corp has also been battered by a slump in
advertising revenue - a direct impact of the global recession.

Its Australian newspapers reported an 18 per cent drop in profit over the quarter.

Mr Murdoch says there'll be rigorous cost-cutting across the company and, as he put it rather
euphemistically in his earnings report, "headcount reductions" where appropriate.

During a earnings teleconference with Mr Murdoch, US media analyst Michael Nathanson was keen to
know just where the job cuts would happen.

MICHAEL NATHANSON: It sounds like, as you say, there has been a little fat at News Corp over the
years. So you describe the opportunity to take out costs, which businesses do you think have the
best opportunities to take out costs and how big could that savings be?

RUPERT MURDOCH: We are thinking might never do them and I'm out in Australia at the moment and the
local management is in the process of combining all their back offices.

There are many different processes we are doing, that goes right across the company.

MICHAEL ROWLAND: The axe has already started to fall at the Wall Street Journal, which News Corp
took over in 2007.

More than two dozen jobs have gone from the prestigious broadsheet in recent weeks.

News Corp's chief operating officer Peter Chernin says there've also been job cuts at the company's
Fox Film Studios

PETER CHERNIN: And I think, you know, we have been extremely aggressive and looking at headcount.
You know we have been trying to that last but we have eliminated, I think, just under 800 positions
from the company.

We put a headcount freeze in the beginning of the fiscal year and then recently we just eliminated
two-thirds of the open jobs so we are down about 800 heads.

MICHAEL ROWLAND: Some analysts have been urging Rupert Murdoch to shut down some of his loss-making
newspapers to help get the company back on track.

But the man with news print in his blood-stream says that's not an option.

RUPERT MURDOCH: I'm extremely happy with all our newspapers. I think that they're good newspapers.
They are increasing their share of market. There has never been a greater appetite for news in the
community and we will be able to capitalise on that very well.

I've got great faith and if we continue the way we're going, we may even get lucky and not have so
much competition at the end of it all.

MICHAEL ROWLAND: Mr Murdoch has experienced firsthand just how bad the economic situation is in the
US and Britain.

He says the Australian economy has so far managed to avoid the brunt of the downturn.

RUPERT MURDOCH: Yeah well I would say that just if I may say, the downturn in Australia hit very
late. It is beginning to hit now and I don't know what the exact figure is but we are not yet
feeling it the way we have felt it in Britain.

MICHAEL ROWLAND: And Mr Murdoch is confident his company and the world will rebound.

RUPERT MURDOCH: Sure there's reason to be concerned and we are running our business to respond to
that concern.

But historically every time we have seen a recession, mild or major, we have endured this panic and
come out better and every time the economy rebounds, advertising comes back usually stronger than
before.

BRENDAN TREMBATH: The News Corporation chief executive Rupert Murdoch ending that report by Michael
Rowland.