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MURDOCH ADMITS TO NEWS CORP. CONTROL OVER FOX
Published February 7, 1995
While testifying before FCC investigators in late January, Rupert Murdoch "bluntly conceded" that his Australia-based News Corp. "controlled all the equity of the American TV stations that were the basis for the Fox television network," according to this morning's N.Y. TIMES. Sworn testimony released yesterday shows that Murdoch said that he had not violated regulations that limit foreign ownership of American stations because he is a naturalized American citizen. Murdoch: "Frankly, there was no secret. ... News Corporation was on the hook for 100%." If the FCC finds that News Corp. and Fox are in violation of foreign- ownership laws, Murdoch could be forced to "sell his stations or restructure the company" (Edmund Andrews, N.Y. TIMES, 2/7). The WASHINGTON POST reports that government investigators have "zeroed in" on a series of internal documents in which Fox officials "discussed changing" the ownership structure "as far back as 1989" (Paul Farhi, WASHINGTON POST, 2/7). Fox officials turned down a corporate restructuring plan in '90 for "fear of triggering an investigation" (Daniel Pearl, WALL STREET JOURNAL, 2/7). PROFITS, PROFITS: Despite a $350M loss "reflecting expected losses" on Fox's four-year NFL contract, News Corp.'s fiscal 2nd Quarter earnings rose 11%. The company said the loss was the difference between what Fox will get in advertising revenue and the cost of licensing, producing and marketing the NFL games over the "life of the contract." The charge was "less than half what many people in the industry expected." News Corp. CFO David Devoe said the percentage of U.S. households reached by Fox increased to 98% -- from 93% -- as a result of the football broadcasts (Eben Shapiro, WALL STREET JOURNAL, 2/7).