—News Corp. bailout?—The first question came from Evelyn Y. Davis, a widely known investor gadfly who claims to own shares in 80 other companies. She complained about the $700 billion bailout, but asked why News Corp. wasn’t asking for one. “What about the media? If the bailout is good enough for the banks, why not the news company?” Murdoch: “I don’t think you can expect any media company, least of all, us, to take a handout from the government.” After 10 minutes, Murdoch gently cut her off, saying, “Thank you for your interesting opinions. Now, can we please stick to the relevant issues at hand?”

—No talks with Sumner: Davis returned to the microphone to ask if News Corp. was interested in buying any of the assets under Sumner Redstone’s National Amusements. Murdoch: “They only have a few that are non-competitive, and we would consider taking a look if anything was for sale, but we are not aware of any and we are not engaged in any talks.” A little later, when Davis tried to ask another question, Murdoch tried to dissuade her as the audience grew restless. He relented after Davis expressed her affection for him, saying, “What do you expect, my darling, I only see you once a year. I’m glad [Murdoch’s wife] Wendi isn’t here, she would be jealous.”

—No debt: Asked about the Murdoch family’s personal debt and how it would affect News Corp., Murdoch sharply responded, “There is no debt. Again, there is no debt… happily.” That was followed by anther speech from Davis, which was greeted with equal amounts of exasperation and amusement by Murdoch and the board members seated on the stage.

—Building a strong balance sheet: This has been the sixth consecutive year of profit growth, Murdoch said. But we are in the midst of a severe credit crisis that is exacerbating the weak global economy. That said, we are as well-positioned as we can be to manage what looks like a long economic downturn. Still, he cautioned that 2009 might not look as good for News Corp. as past years. “Fiscal 2009 will be a year of many – in some cases unprecedented – challenges; we cannot fool ourselves into believing otherwise.There are three significant aspects to our business that supports this view. I’m proud to say unlike so many others – we have not allowed ourselves to grow complacent. For the past five years or so, we have capitalized on global trends to grow our company by an average of more than 15 percent a year – a feat unmatched by any of our competitors.  And we’ve done it by constantly looking forward – and determining where the growth drivers will be five years down the road. We have strengthened our balance sheet at the same time we have strengthened our businesses.  The result is that we have a war chest of approximately $5 billion in cash, and have extended our average debt maturity to more than 22 years. In uncertain times, this capital reserve gives us stability. We intend to continue to reevaluate our mix of businesses and seek new growth drivers to ensure that we have the right balance geographically … the right balance across different business sectors … the right balance between advertising-supported and subscription-based businesses. This strategy will help us weather the economic storm ahead and guide our decisions as we look to increase our subscription-based businesses and focus on the next generation of digital properties.”

—FBN’s progress: Murdoch: “Today Fox Business Network has more than 40 million subscribers, and is well on its way to becoming a formidable challenger to its 18-year-old competitor, CNBC. Though the Fox Business Network ratings are not large, they nonetheless are slightly ahead of where Fox News Channel was at a similar time in its development.  We’re up 400 percent in prime time – and up more than 250 percent in our targeted demographic. And the financial crisis is translating into greater interest for the coverage our Fox Business Network provides. Meanwhile, our $80 million investment in the Big Ten Network is poised to break even in its first year out.  In fact, it even has the potential to show a modest profit, which would put us ahead of our timetable.”

—Subscription at WSJ.com pays off: Newspapers in Australia and England newspapers are doing well. Murdoch noted that things don’t look so well for most others. That said, the merger with Dow Jones has contributed to News Corp. and that company’s properties mutually. “Since Dow Jones was acquired by News Corp., WSJ.com’s audience has surged 90 percent. We continue to believe that a subscription wall is the surest path to growing revenues at WSJ.com.”

—On FIM:  “Fox Interactive Media saw revenues grow 57 percent and operating income increase five-fold, with growth based on increases in ad and search revenue at MySpace. FIM sites attract 12 percent of all U.S. traffic on the web – an astounding volume.  And our recently launched MySpace Music saw more than one billion music streams. And as we expand these opportunities, FIM is moving beyond the desktop and expanding the reach of its core brands with ad-supported mobile sites, signing mobile distribution deals with every major carrier in the world.” Murdoch also noted that FIM has become “nearly a $1 billion business in just three years of existence. It took Google five years to reach that milestone. Profits-per-user are up 53 percent over last year. Clearly, we’re still in the early stages of figuring out the best ways to translate the huge potential of FIM into advertising revenue.  But we are encouraged by what we see. We’re also encouraged by Hulu. It has become a real success in the six months since it launched. Already it is the number eight site on the web for video.  Indeed, more people visit Hulu to watch their favorite shows than all the network sites combined.”