Topper touts buyback, gets Bearish on Mouse
NEW YORK — On Tuesday, News Corp. prexy-chief operating officer Peter Chernin offered a few solutions to Disney’s problems. And one of those solutions is change, he pointed out, saying studios have to constantly reinvent themselves.
And lest those scouring the Bear Sterns investor gathering in Palm Beach, Fla., for news think that Chernin might be signaling his willingness to defect to take the top job at Disney, the Murdoch exec wasn’t sniffing at the cheese.
But Chernin allowed he’d read James B. Stewart’s “DisneyWar,” and said he was struck by the tortured fall of Disney’s live-action and animated film studios after the unbelievable successes of the 1980s and early ’90s. “They went into a period of absolute disaster … they’ve been about as bad as anybody,” said Chernin, arguing that complacency may have been the culprit.
Sitting down for a post-dinner chat at the confab, Chernin did offer one piece of news, saying it’s important for News Corp. to buy back outstanding shares in Fox Entertainment.
He disclosed News Corp. hasn’t had any meetings with John Malone’s Liberty Media this year about such a stock buyback, but said there were a few discussions late last year.
Earlier in the day at Bear Sterns, Malone echoed there have been no recent meetings.
Malone caught Murdoch uncharacteristically off guard when buying up an additional chunk of voting stock in New Corp. just as News Corp. was reincorporating from Australia to the U.S. Now, Murdoch wants that stock back.
Wall Street analysts believe News Corp. may buy back the shares picked up by Liberty in a cash-rich split-off.
“Look, we view the situation fairly opportunistically,” Chernin said. “I think there is more pressure on them (Liberty) to move quickly.”
Back on the subject of movies, Chernin said studios must rethink the movies they make, a point he will make clear at an upcoming retreat of Fox Filmed Entertainment staffers and execs.
For instance, Chernin he said while he’s pleased with 20th Century Fox’s “Fantastic Four,” he believes the appetite for such pics will fade away.
“I am personally worried about big-event, comicbook movies,” Chernin said. “I don’t want to make them in five years. I think people will get sick of them.”
Chernin also said he’s had concerns about the audience’s appetite for historical epics, considering the tepid domestic response to “Alexander” and “Troy.” Nevertheless, he believes Fox’s upcoming “Kingdom of Heaven” — which takes places during the 12th century Crusades — will be a box officer performer.
Chernin, touting the strength of Fox’s film properties, said Fox has gotten out of the business of making “middle” movies. Smaller movies go to niche divisions Fox Searchlight or Fox 2000, while 20th Century Fox remains home to the big projects. Gone are the movies that cost in the neighborhood of $75 million.
A favorite among Wall Streeters, Chernin received warm-and-fuzzy treatment at the Bear Stearns gathering. He was even provided the chance to poke some fun at Time Warner topper Richard Parsons, who spoke earlier in the day. At one point, Parsons told Bear Stearns investors cable companies — such as his very own Time Warner Cable — are turning into “robust” telecos.
“With all respect to Dick, I’m not sure I would aspire to be a telecommunications company,” Chernin said.