News Corp CEO Advocates for Fair Compensation from AI Firms
On Thursday, Robert Thomson, the CEO of News Corp, expressed concerns about artificial intelligence companies needing to pay for the journalism and data they utilize. This statement followed the company’s report showing an increase in revenue and profits for the first quarter.
Thomson emphasized that “creativity and content should not be stolen, but should be purchased at a fair price.” He elaborated on the critical role of information and advanced data in AI, suggesting that without these elements, AI lacks substance—comparing it to “electricity without clarity, buildings without bills, tips without chops.”
This discussion coincided with News Corp’s financial results, which highlighted growth in profits largely attributed to its Dow Jones segment and digital real estate ventures. The company noted a revenue jump of 2%, reaching $2.14 billion for the quarter ending September 30, thus surpassing analyst predictions. Additionally, net income from ongoing operations saw a modest rise of 1%, totaling $150 million.
The profitability of News Corp’s news media sector, which includes outlets like The Post and The Times of London, showed improvement as well. Lavanya Chandrashekhar, the Chief Financial Officer, noted that the news media division enjoyed a strong quarter, with revenues climbing 1% to $545 million, primarily due to increased subscription prices in the UK and Australia.
Despite mixed advertising trends, the New York Post stood out with significant performance gains. Overall, the division’s EBITDA surged by 67%, reaching $30 million, contributing to a 5% increase in the total EBITDA for the company, which amounted to $340 million.
Adjusted earnings per share rose slightly to $0.22 from $0.20 a year ago. Thomson remarked on the perceived undervaluation of News Corp’s shares, given the company’s value and earning trajectory.
He also criticized AI for misrepresenting the worth of intellectual property, noting a growing awareness among both companies and legal systems about the importance of creativity and content. “It is clear that the value of IP in the age of AI is misunderstood,” he stated.
News Corp reported a strong cash position and anticipates generating solid free cash flow in the current financial year. Revenue from Dow Jones, which encompasses the Wall Street Journal, increased by 6% to $586 million, fueled by a 16% rise in professional information and more digital subscribers. Meanwhile, Move, the parent company of Realtor.com, experienced a 9% revenue boost, marking its fastest quarterly growth since early 2022.
Although the book publishing sector faced challenges due to a $13 million write-off, News Corp indicated signs of recovery for HarperCollins. Thomson shared that the company’s ongoing legal and licensing strategy with AI firms was making headway, mentioning that “courtship and courts are both important elements of our strategy.” He anticipates further partnerships soon that should positively influence their results.
