News Corporation\'s Earnings Surpass Expectations

Josh Reynolds/Associated Press Rupert Murdoch did not participate
in an investors' call.

The News Corporation, benefiting from one-time gains and the continued strength of cable channels like Fox News, on Tuesday posted earnings that generally exceeded analysts' expectations.

The company, controlled by Rupert Murdoch, said that net income in the third quarter of the year - its fiscal first quarter - jumped to $2.23 billion, or 94 cents a share, from $738 million, or 28 cents a share, in the same quarter last year.

The uptick was mostly a result of the sale of the company's stake in the technology firm NDS Group to Cisco Systems. Excluding that and other one-time factors from this year and last year, the News Corporation earned 43 cents a share in the quarter, up from 32 cents a share last year.

The company's revenue rose to $8.14 billion, up from $7.96 billion.

Mr. Murdoch said in a statement that the company was led by “double-digit growth in our channels business and the global success of our film and television content.”

The company's cable channels segment made almost a billion dollars in profit in the quarter, because of an 8 percent jump in advertising revenue and a 16 percent increase in revenue from subscriber fees. Its film division made $400 million in profit and its television division (the Fox network and local stations) made $156 million.

The cable division benefited from what the company called “a more than doubling of retransmission consent revenues,” the fees paid by cable and satellite companies to show local stations.

Publishing, on the other hand, showed a profit of just $57 million, down from $110 million in the same quarter last year. The company cited lower advertising revenue across all segments, led by declines in the publishing business in both Australia and the United States.

Ongoing charges relating to the phone hacking investigation in Britain cost the company $67 million in the quarter.

Mr. Murdoch did not participate in the company's conference call with investors on Tuesday afternoon. His chief operating officer, Chase Carey, avoided talking about possible acquisitions, two weeks after news reports that the company was interested in buying The Los Angeles Times from the Tribune Company. “Obviously we should look at some things,” Mr. Carey said, sticking with generalities.

News Corporation is preparing to break into two companies, one for higher-performing television and film assets like Fox and the cable division, and another for publishing assets like The Wall Street Journal. Mr. Murdoch said in his statement that “w e have made considerable progress in this process and look forward to providing more details by the end of the year.”

Last month, at the annual shareholders' meeting, Mr. Murdoch faced challenges to the News Corporation's management structure, with some investors calling for changes on the board and the elimination of the dual stock structure that enables the Murdoch family to retain control of the company.

Pandora Opens a New Front in Its Royalty War

Pandora Media is already engaged in one tense war with the music industry over its royalty rates. With a new lawsuit, it has expanded that war to two fronts, underscoring how critical royalties are to Pandora's business - as well as to the artists and music groups that accuse the company of asking for a break at their expense.

In September, a bill was introduced in Congress, the Internet Radio Fairness Act, that could lower the royalties Internet radio services pay to record companies. Pandora, which supports the bill, along with Clear Channel Communications and various technology groups, say it believes that such a change would bring its royalty obligations in line with those of other digital services that pay less, like satellite radio. But the music industry has cried foul.

On Monday, Pandora expanded its efforts by suing the American Society of Composers, Authors and Publishers, one of the United States' major performing rights organizations, to lower its r oyalties to music publishers and songwriters. Pandora's last license with Ascap expired almost two years ago, and in the suit, filed in United States District Court in Manhattan, Pandora asked the court to set a new licensing deal with “reasonable rates and terms.”

As it has with the Internet radio bill, Pandora characterized its suit as an attempt to get fair treatment, comparing its situation to that of broadcast radio. Radio stations pay 1.7 percent of their revenue in publishing royalties, minus deductions for advertising commissions; Pandora pays 4 percent, and does not get the same deductions.

“Ascap continues to seek rates higher than the current rates and above the agreement that they reached earlier this year with all of the major radio groups, which covers both broadcast and Internet radio usage for the majority of our competitors,” a company spokeswoman said. “As a result, we are initiating the process that has b een in place for decades to resolve royalty disputes with Ascap.”

Ascap declined to comment. But another industry group, the National Music Publishers Association, criticized Pandora for filing the suit.

“It's outrageous Pandora would try to reduce the already nominal amount they pay songwriters and music publishers, when Pandora's business model is based entirely on the creative contributions of those songwriters,” David Israelite, the president of the publishers association, said in a statement.

The case also touches on the somewhat obscure but contested issue of direct licensing. Ascap offers blanket licenses covering all the repertory it represents, but Pandora wants to be able to “carve out” from that fee the cost of licenses that it must negotiate directly. (Some publishers, like EMI, have opted out of the performing rights groups for their digital dealings.)

The legality of these kinds of carve-out deals has been affirmed by two recen t court decisions involving DMX, a company that supplies music to stores and restaurants. But they are still controversial. Proponents say they believe that publishers can make more money if they negotiate on their own behalf, but critics worry that they will undermine collective bargaining through the organizations and ultimately devalue music licenses, hurting all artists.

Ben Sisario writes about the music industry. Follow @sisario on Twitter.

Election Night: Live-Blogging the Media Coverage

The Media Decoder staff looks at the media coverage of the 2012 presidential election.

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Secrets of High Credit Scorers

Have you ever wondered: Just what do I have to do to have a superhigh credit score?

MyFico.com, the consumer arm of FICO, creator of one of the most widely used family of credit scores, has published a report on those it considers “high achievers,” or those with FICO scores of 785 or higher.

FICO scores range from 300 to 850 - the higher the score, the better your credit profile, and the more likely you are to get a loan at a favorable interest rate. Scores are based on information reported by lenders to credit reporting bureaus like Experian, TransUnion and Equifax. You can have multiple scores, depending on what sort of loan you're seeking and which credit bureau is doing the reporting.

More than 50 million people - about a quarter of all people with credit scores - have scores of 785 or higher, and they exhibit “strikingly similar” credit habits, regardless of background and life experience, according to myFico. (The analysis is based on April data and used FICO 8 scores, the most recent version of the “general purpose” FICO score.) Over all, those with the highest scores keep low revolving balances relative to their available credit; they don't “max out” their credit cards; and they consistently make payments on time, even if it's just the minimum required amount.

High credit achievers aren't debt-free. One-third have total balances of more than $8,500 on nonmortgage accounts. The rest have total balances of less than $8,500.

But while they may carry a balance, 96 percent of high achievers show no missed payments on their credit report. And those who do have late payments had one four years ago, on average. Less than 1 percent of high achievers have an account past due.

This is important, because payment history represents 35 percent of an individual's FICO score. So making at least the minimum payment in every billing cycle helps support a high score.

Even those with excellent FICO scores may have had bumps along the way. About one in 100 high achievers has a collection on a credit report, and about one in 9,000 has had a tax lien or bankruptcy.

But high achievers often keep balances low and use an average of only 7 percent of their available revolving credit.

The FICO high achievers have a well-established credit history and seldom open new accounts. Over all, their average credit account is 11 years old.

“While people with a high FICO score are not perfect, their consistently responsible financial behavior usually pays off over time,” Anthony Sprauve, credit score adviser for myFico, said in a statement.

How does your credit behavior compare with those of the “high achievers?”

AOL Reports Stronger Ad Sales

AOL reported a strong third quarter on Tuesday, helped in large part by improved ad sales.

Global advertising revenue increased 7 percent, to $340 million from $317.7 million, in the latest quarter, compared with the same period a year ago. The company had an 18 percent increase in revenue from third-party ad networks, including the company's network, Advertising.com, and and 8 percent increase in search and contextual advertising.

“We have positioned AOL for growth in 2013 and beyond with consumer and advertiser demand growing for our premium content and innovative products, video, services and ad formats,” Tim Armstrong, the company's chief executive, said in a statement.

But not all the advertising news was positive. Revenue from display advertising in the United States fell 3 percent, to $122.5 million. Revenue from international display sales rose 18 percent, to $12.9 million, which reflected growth in Canada and Britain, the company said.

Over all, AOL reported revenue of $531.7 million, which was flat compared with the same period last year. The company's earnings were $20.8 million, versus a loss of $2.6 million a year ago.

Shares in the company jumped more than 14 percent on Tuesday.

In a conference call, Mr. Armstrong said the advertising business was “an area of strategic importance,” for AOL and was split into two areas - programmatic or automated buying and “deep marketing services,” to create customized solutions for advertisers. Mr. Armstrong said he expected programmatic buying to grow significantly next year, and added that that the company had invested in technology and staff to expand that side of the business.

The use of the the AOL brand advertising platform, Project Devil, which allows advertisers to occupy all the advertising spaces on a Web page, had grown at “double digit rates,” and repeat usage of the platform by advertise rs was “very strong,” the company said in a statement.

Mr. Armstrong acknowledged that the domestic display advertising results were “not as robust as we would like.” But he said the company planned to improve traffic across all of its brands and invest in more lifestyle brands on The Huffington Post, which would allow advertisers to better target users with contextual ads.

“The majority of our advertising revenue comes from the traditional display business over all,” Mr. Armstrong said. However, programmatic buying and specialized marketing services were growing quickly, he said, and “at some point in the future they will overtake the traditional display business.”

Many AOL sites were buoyed by recent news events, including Hurricane Sandy on the Eastern Seaboard and the presidential election. Mr. Armstrong said. The company's network of hyperlocal news sites, Patch.com, ran 14,000 articles and blog posts and 7,000 to 10,000 photos and vide os about the hurricane. The hurricane also drew “hundreds of millions of page views” for The Huffington Post, Mr. Armstrong said. “Traffic has exploded with Sandy.”

In addition to programmatic buying, Mr. Armstrong said he expected that advertising dollars would shift to digital video from television and that mobile advertising would increase. “I would expect mobile usage to grow and I would expect mobile advertising to grow,” he said.

Revenue from the company's dial-up Internet subscriptions declined 10 percent in the quarter, to $173.5 million from $191.9 million.

The company has been on something of a hiring spree, with 700 new AOL staff members hired in the last seven months, Mr. Armstrong said.

A Last Fact-Check: It Didn\'t Work

As so many media outlets promised, this was indeed the most fact-checked election in history. At any given moment during the past 18 months, there were so many truth squadrons in the air that mid-air collisions seemed a genuine possibility.

But as the campaign draws to a close, it's clear that it was the truth that ended up as a smoldering wreck. Without getting into a long tick-tock of untruthfulness, a pattern emerged over the summer and fall: both candidates' campaigns laid out a number of whoppers, got clobbered for doing so, and then kept right on saying them. Conventional wisdom suggests that the Romney campaign stepped across the line with more frequency, and we'd love to draw a conclusion from that, but it would involve fact-checking.

Let your mind drift back over the silly season for a moment, if you can bear it, and it's clear that baloney was on the menu almost every day of the campaign, often served with a cry of indignation from the other side. Yet the myths persisted: Mitt Romney more or less gave cancer to the wife of a fired steel worker who lost his insurance, and President Obama somehow shipped jobs to China by helping the auto industry survive. We could go on, but why bother?

“There are no consequences anymore,” said Mark McKinnon, a political analyst who writes for The Daily Beast and was a strategist for President George W. Bush. “It's like everyone's driving 100 miles per hour in a 60-miles-per-hour zone and all the cops have flat tires.”

Actually, there are plenty of people in hot pursuit. If the campaigns acted as if they lived beyond the thermodynamics of truth, it wasn't due to media inattentiveness. All the big national newspapers had major fact-checking initiatives and the moment speeches or debates ended on the cable networks, a fleet of scolds would descend and tut-tut about this fib or that. PoliFact, one of the progenitors of the movement, had a very busy season, as did FactCheck.org

And don't forget that social media sites, most prominently Twitter, served as a crowd-sourced pat-down on nose-growing statements from the campaigns.

Nothing was too minor or too ineffable to send through the crucible of truth. When the First Lady suggested that the president was “always ready to listen to good ideas,” an amorphous statement that doesn't exactly seem ripe for fact-checking, Fox News was undaunted and put the lie detector on her assertion. The thicket of observers putting the gimlet eye on campaign assertions became ubiquitous enough to present a comic opportunity for Bill Murray and College Humor.

And yet both campaigns seemed to live a life beyond consequence, correctly discerning that it was worth getting a scolding from the journalistic church ladies if a stretch or an elide or an outright prevarication did damage to the opposition. (And like pollsters this season, fact checkers were often accused o f being far from neutral, although when the guns were trained on their opponents, their status as political eunuchs was restored.)

Well, it may not be effective in a civic sense, but it is a hit in the ratings.

Paul Colford, a spokesman for The Associated Press, told Erik Wemple of The Washington Post: “Generally, our fact check pieces are among the stories that most frequently make online popularity lists, like the one Yahoo keeps. On those lists, they often outperform and outlast the mainbar stories to which they are sidebars.” According to Mr. Wemple, Ben Swann, a reporter from a Fox television station, ended up with more than 46,000 likes on Facebook for his fact-checking work.

Mr. Wemple pointed out to me that when debates kick up huge numbers, fact-checking what the candidates say will probably kick up a bunch of page-views.

Half-truths are now fully baked into political discourse and the public is inured to the growing forest of fibs, but people certainly seem to like watching the fact-check spanking machine at full speed. Fact checking, as it turns out, is more of a cottage industry than a civic corrective. In a highly divided country, partisans seek out proof that the other side is lying, sending it viral, but mostly in a way that lands on the choir. Back in August, Jack Shafer, the Reuters media columnist, called the exercise “a mugs game”, saying, “the growing sensitivity to political lies has less to do with more lying by more politicians than it does with the growth of the fact-checking industry over the last decade or so.”

And if the facts are not sticking, it's worth thinking about who is doing the checking.

“Let's not forget that fact checking is associated with the media industry, not exactly the most trusted institution around,” Mr. Wemple wrote in an e-mail. “Defying it can carry only so much risk.”

Because consumers can create their own mediated universe, they ca n program their intake in a way that confirms their biases, exposes their opponents as liars, and makes them feel like they are armed with the truth when they step behind the curtain on election day.

Anheuser-Busch Asks Studio to Obscure Labels in \'Flight\'

LOS ANGELES - The high-flying, alcoholic commercial airline pilot Whip Whitaker, portrayed by Denzel Washington in the drama “Flight,” has drawn objections from the beer brewer Anheuser-Busch and the distributor of Stolichnaya vodka for using their products in the movie without authorization, The Associated Press reported.

Whitaker consumes a vast array of drugs and alcoholic products by a number of makers in the film, which was directed by Robert Zemeckis and took in about $24.9 million at the domestic box-office for Paramount Pictures over the weekend. But both Anheuser-Busch and the Stolichnaya distributor told The A.P. that the products were used without authorization and would not have been approved for use in the movie.

Anheuser-Busch, which makes Budweiser beer, also said it had asked Paramount to remove or obscure its company brand name in the film, in which Whitaker both drives and flies while drinking.

“We would never condone the misuse o f our products, and have a long history of promoting responsible drinking and preventing drunk driving,” an Anheuser-Busch spokesman said in a statement to The A.P. “We have asked the studio to obscure the Budweiser trademark in current digital copies of the movie and on all subsequent adaptations of the film, including DVD, On Demand, streaming and additional prints not yet distributed to theaters.”

While filmmakers often receive payments to place products in a film, manufacturers do not have blanket control over the portrayal of their wares. Robert Lawson, a spokesman for Paramount, declined to comment on the objections.

Key Senior Executive at the Times Company Will Retire

A senior executive of The New York Times Company responsible for the company's key business results is retiring, and the company is eliminating the position entirely.

Scott Heekin-Canedy, president and general manager, will retire by year's end. Arthur Sulzberger Jr., the company's chairman and chief executive, wrote in a note to the staff that Mr. Heekin-Canedy's departure means “we are losing a great talent who has seen us through a very difficult economic period.” Mr. Sulzberger credited Mr. Heekin-Canedy “for his creation of a strong senior team with deep expertise” and for his involvement in introducing the company's digital pay model.

According to a public filing released this morning, Mr. Heekin-Canedy, 61, will receive a severance package equivalent to his annual $587,000 salary and a year of health insurance. He has worked for the company since 1992 and served as the company's president and general manager for eight years. His last day at The T imes is Dec. 30.

Mr. Heekin-Canedy's departure coincides with many transitions at the company. The company officially welcomes its incoming chief executive Mark Thompson, former director general of the BBC, on Nov. 12.

Last month, the company reported in its third-quarter earnings an 85 percent decline in net income from the year before, because in part of a troubled advertising market. The results were buoyed by strong growth in digital subscriptions.

Understanding the High Cost of Veterinary Training

Jodi Hilton for The New York TimesTaking a patient to the lab at Tufts University School of Veterinary Medicine.

As a child, I dreamed of becoming a veterinarian. I collected pets of all sorts: gerbils, dogs, cats, rabbits (one of which was eaten by one of my cats) and finally, when I was a teenager, a horse. I devoured James Herriot's series, “All Creatures Great and Small,” about a country veterinarian. My future career seemed clear.

But squeamishness about blood and a dismal year of organic chemistry in college (they call them “weeding out” courses for a reason) persuaded me that my professional future lay elsewhere.

But I still love animals, a nd admire the people able to persevere through veterinary school, in the face of daunting odds and heavy financial challenges, to care for them. As this week's Education Life reveals, veterinary school grads carry an average debt of $125,000, while veterinarians have an average income of $121,000.

A recent post I wrote about the high cost of pet drugs elicited some strong comments from veterinarians, and their parents, about the economic challenges facing veterinarians:

From a comment by Chris in Chicago:

New vets graduate with huge school debt ($146-250k) after 8 years of training and soon won't be able to find jobs even where needed because no vet clinic can afford to pay what they need to be paid just to pay their school loans. What will we do then?

And this from a parent in Pasadena:

My daughter is a vet. She does not drive a big or expensive car. She works long hours. It will be many more years before she pays o ff her student loans. Nobody complains about her prices. Nobody.

Does understanding the cost of veterinary school make your pet's medical bills seem more reasonable?

Questions Answered About Pension Plans

Readers recently submitted questions about pension plans to Mary Williams Walsh, a business reporter for The New York Times who has written about how companies manage their pension plans; what happens when companies go bankrupt; public workers' pensions and how they may affect state and local finances; and Chapter 9 municipal bankruptcy. (Not all questions can be answered in detail, and some questions have been edited.)

Q. It seems that conservative politicians are bashing public pension systems in addition to their assaults on public workers. What implications does that have for the future of public pension systems? - Steven M., Sacramento, Calif.

A. Yes, criticism of public pensions has increased sharply. But years before the politicians chimed in, there was already a dead-serious debate as to whether these systems were sustainable. It wasn't among politicians so much as actuaries, economists, accountants and other specialists, some of whom had begun to believe that states and municipal governments - and the professionals who advise them - were routinely underestimating the cost of the pensions they were promising to thousands and thousands of workers. As a result, too little money was being set aside in advance, and some places were bound to come up short when the baby boomers retired. From what I can tell, their concerns were valid, and yet it was years before they could get anybody to take them seriously. In the meantime the problem grew.

Defined-benefit pensions are really good benefits, and it shouldn't come as a surprise that we can't provide them out of thin air. Yet if something is threatening public pension systems, I suspect it's not politicians bashing them, so much as the sticker shock that more and more ordinary Americans will feel when they find out how much they are expected to pay in the coming years for benefits they thought were already paid for.

Q. I've been told that public employees' pensions in New York are “guaranteed” by the New York constitution. Are they? - Smotri, New York

A. I've heard the same thing, not just in reference to New York, but some other states as well. When I've asked legal specialists, I've been told there is no such “guarantee,” in the legal meaning of the term.

What New York State does have is explicit constitutional language stating, in effect, that the pension formula in force on the day an employee joins the public retirement system cannot be reduced for the rest of that employee's public career. This is better protection than workers in the private sector get from the federal pension law; it's also fairly unusual among the 50 states.

The states use a wide variety of legal approaches to protecting their workers' pensions. Amy B. Monahan, a professor at the University of Minnesota Law School, has written a detailed overview of the state provisions, available here from the Social Science Research Network. (The Network requires registration at no cost.)

Ms. Monahan brings up the concept of a state's “police power,” which means its inherent right “to preserve the public security, order, health, morality and justice.” In a state with the type of legal protection New York offers, she writes that just about the only way to curb public pension obligations would be to do so pursuant to the state's police power.

Q. My wife will be turning 62 in November 2014. When should she enroll for Social Security? I will be 65 in March of 2015. When should I enroll? Thank you. - kenb100231, Egg Harbor Township, N.J.

A. There is no single right answer to this question - it depends on personal circumstances that can vary greatly. But for starters, here are a few things to consider. You can apply for Social Security any time from age 62 to 70, but the Administration sets a “normal retirement age,” when a retiree collects a “full benefit.” People who apply ahead of their normal retirement age will have that benefit reduced.

The Social Security Administration has been gradually ratcheting up everybody's normal retirement age. You and your wife both appear to be in the group whose normal retirement age is 66. If your wife worked outside the home and would be applying for her benefits at age 62 - four years ahead of her normal retirement age - her “full benefit” would be reduced by 25 percent. (If she were applying for a 50 percent spousal benefit, the reduction would be 30 percent.) Social Security benefits are adjusted for inflation, but those substantially reduced amounts would be her base benefit for life.

You, on the other hand, would be enrolling just one year early if you signed up at age 65, so your reduction would be considerably smaller, a little less than 7 percent.

But there are many other factors that you and she should consider. What other resources do you have to live on? Does either of you plan to keep working after enrolling in Social Security? (Doing so below your normal retirement age can affect your benefits.) What are your plans for health care? (Medicare, and its required premiums, normally begin at 65, even if you decide not to enroll in Social Security until later.)

The Breakfast Meeting: The Fox News-MSNBC Campaign, and Adult Films\' Anti-H.I.V. Strategy

This presidential election, Fox News and MSNBC have become the poles that mainstream, two-party politics in the United States revolve around, Jeremy W. Peters reports, as they have pushed their stridency to new levels. Not only does that mean that the candidate for the other side receives barely any positive coverage, according to research, but the negative coverage can turn disturbingly personal. Both Fox News and MSNBC have idly speculated on the mental health of candidates on the presidential tickets.

• Rupert Murdoch, whose News Corporation owns Fox News, has been using Twitter to comment on the presidential election. On Monday, he expressed doubt that his preferred candidate, Mitt Romney, would prevail: “Everybody searching for any scrap of news about election tomorrow. plenty of straws to grasp for Romney, probably not enough.”
• President Obama's campaign in the last few days has been assisted by an array of performers including Jay-Z, Dave Matthe ws, Stevie Wonder and John Mellencamp. Bruce Springsteen, who has also been performing at rallies for Mr. Obama, on Monday gave a call from Air Force One to Chris Christie, the Republican governor of New Jersey and lifelong Springsteen fan who has been working with the president on the recovery from Hurricane Sandy. The call was promptly relayed by the governor to reporters.

AOL on Tuesday morning reported third-quarter revenue of $531.7 million, which was flat but higher than expected, Reuters said, with the strongest advertising growth the company has seen in seven years. The results pleased analysts as an increase in advertising outweighed a decline in subscription revenue for AOL's dial-up services.

The pornographic film industry conducts frequent H.I.V. tests of its actors, and has an extensive system of sharing the test results, Donald G. McNeil Jr. reports from California, that has proved successful, the industry says. According to the industry's med ical consultants, about 350,000 sex scenes have been shot without condoms since 2004, and H.I.V. has not been transmitted on a set once. Los Angeles County on Tuesday will be voting on a ballot measure that would make it illegal to shoot a pornographic film without the use of condoms; the filmmakers resist, saying that films showing actors who use condoms are simply not as popular.

Noam Cohen edits and writes for the Media Decoder blog. Follow @noamcohen on Twitter.

Tuesday Reading: Reassessing Flu Shots

A variety of consumer-focused articles appears daily in The New York Times and on our blogs. Each weekday morning, we gather them together here so you can quickly scan the news that could hit you in your wallet.

• States accommodate voters displaced by Hurricane Sandy. (National)
• Hacking of tax records puts states on guard. (National)
• Bracing for an upturn in lodging rates. (Business)
• Jump-starting air travel after everything went dark. (Business)
• The costs of shoring up coastal communities. (Science Times)
• Old, frail and in harm's way. (The New Old Age)
• Reassessing flu shots as season draws near. (Well)
• The big swipe: Debit card fees. (Economix)
• A cold shoulder for Amazon as publisher. (Bits)
• A key addition to phones lacking keyboards. (Gadgetwise)
• Lessons from a marathon not run. (Well)
• When hospital patients continue to smoke. (Well)
• Fish may beat pills for Om ega-3s. (Well)
• Questions answered about pension plans. (Booming)
• November college checklist for seniors. (The Choice)