Peter Chernin, the long-time president and COO of News Corp, is leaving the company after protracted negotiations over his contract could not be resolved. Chernin’s salary was $28.8 million in the last fiscal year, which was $1.3 million more than even Rupert Murdoch’s take-home pay. Chernin helped Murdoch build and oversee his vast media empire over the past 20 years, and his departure no doubt will raise all sorts of questions about the future of the company. He will be leaving when his current contract expires on June 30.
For instance, what will happen to Fox Interactive Media (FIM)? This particular corner of the Murdoch empire is where News Corp keeps all of its Web businesses: MySpace, Photobucket, IGN, Scout, Chernin was its biggest supporter and internal sponsor. Peter Levinshon, the leader of FIM, was considered to be within Chernin’s camp. Although Chernin and Murdoch worked hand-in-hand, they are also very much opposites and a competitive rivalry always existed between the two. News Corp executives often identify with one boss or the other. MySpace CEO Chris DeWolfe, for instance, is considered a Murdoch guy.
With Chernin gone, perhaps this is as good a time as any to take another look at FIM and what purpose it serves. Its original purpose was almost as an internal M&A fund for Internet startups. But now those businesses have grown up. Other than MySpace, which contributes the vast majority of FIM’s revenues and profits, it is not really clear what the point of FIM is. Photobucket could just as easily be part of MySpace. And some of the other businesses could be integrated into other operating units, or sold off. The overhead of running FIM with all of those expensive lieutenants could be reduced as well. Investors would certainly like to see MySpace broken out as a separate business, instead of having to back out estimates of its performance based on FIM numbers as a whole.
Complicating matters is that the employment contracts for MySpace founders DeWolfe and Tom Anderson are up for renewal later this year (each one reportedly makes $15 million a year). Would DeWolfe want to broaden his control to new fiefdoms within News Corp, or would he try to avoid taking on what appear to be deadweight businesses? Or maybe FIM just remains as it is: an anachronism within News Corp.
(Photo by What Counts).
With the way things are it might take a while to find a replacement.
Please check out Biteonthat.com
I don’t think this will really matter in the future. Myspace is really played out and I don’t really see any growth in the whole social networking sector. It got popular with people who didn’t know much about the internet and the perils of posting your personal information for the entire world to dig through. Most have already realized that they were just filling a marketing database by creating accounts on MySpace and Facebook, and others will soon follow. Personally I think the future of the internet will shift more toward anonymous networks like http://www.anonboard.com
those salary just wow and wow again. where do i signed up?
At http://www.toefl.org
chern’s job is over, not much to work with. newspaper acquisitions are over. andreesen says to stop the presses. myspac has growth issues. myspac does not have the capacity to be a onestop shop for search, business and social. they have been branded forever. no serious business professional will put there company on a myspac business social profile. chern knows he can be much more prosperous as a solo venture fund. fox needs to make more strategic acquisitions or they will be left behind. whom ever creates the greatest strategic multichannel location based business social network that transends the internet and mobile devices seamlessly win the last and final digital frontier.
KillerLocator.com – easy prey
Get a life already!!
Wow that’s a pretty big loss for FIM. I wouldn’t be surprised if the whole section just becomes MySpace and everything gets integrated.
http://www.thew...war.com/myspace
I just hope they keep Erick on board after they buy TC!
Well, since rumor has it that Chernin was fired for giving the RIAA personal information of FIM users, your hopes may be realized after all!
Hold out for more!
28 mil just seems so insignificant, right?
FIM also houses their R&D arm Slingshot Labs. There has been stories that Chernin was considering shutting down the arm because of the lack of revenue and a need to recoup cash. I cant imagine his departure will help matters at all.
Can anyone provide me with a rough valuation of FIM? Sorry for beating the same ol’drum but I really do think that FIM would be a good acquisition for Yahoo.
What is the hidden story? {seesmic_video:{”url_thumbnail”:{”value”:”http://t.seesmic.com/thumbnail/u4pOj1d7Zq_th1.jpg”}”title”:{”value”:”What is the hidden story? ”}”videoUri”:{”value”:”http://www.seesmic.com/video/K9dmonVGxU”}}}
1 year at $28M or 1 at $15 and I can pretty much call it a day
Ney … what would be the fun in that? But I did think it.
You guys need to go and get more info. FIM is already GONE!!! It’s been disolved internally and the executives and staff are finding other jobs in the Fox organization. This happened weeks ago!
Hey Erick, are you sure Chernin is out??
Given your penchant for posting complete crap that you’ve made up (ie, the last.fm/RIAA “rumor” you invented over the weekend to garner some cheap traffic)… it is fair to question everything you post — and TechCrunch posts — going forward until you post an apology and a retraction.
Are you sure Erick? Are you sure you’re not full of shit?
FIM has too many VP’s who are really directors at any other company. . . they need to consolidate and stop paying so much salary to people running sites with < 10M
Schonfeld, you could get a job at Fox News if you keep writing article titles as questions.
Then again…
Would Fox News take you on after your lastFM debacle ?
If Fox keeps FIM, they should really put a tech guy in charge (sorry pete!).
I didn’t know people could earn more than their bosses. This changes everything.
MySpace has a long way to go in terms of pruning. The previous poster who said there are many VPs who would be directors at any other company is right on the money. There are some people at “FIM” who were directors at their previous gig and were given SVP titles at MySpace (not mentioning names but they are out there). It’s ridiculous. I think they’ve also hired too many ex-AOLers and Yahoo people. There’s a reason those businesses are failing to thrive.
Pity. I was so looking forward to Newspaper 2.0.
Lieutenant do you know what a Code Red is?
Not so fast. Lieutenant?
I have two books at my bedside, Lieutenant: the Marine Corps Code of Conduct and the King James Bible. The only proper authorities I am aware of are my commanding officer, Colonel Nathan R. Jessep, and the Lord our God.
*** God I wish back there at Fox Interactive, managing those tissies with the old man, playing corporate politico***
My acne is cleared – so is the path back to RM’s heart.
I love you Rupert.