Murdoch Spins a Nifty Web

Rupert Murdoch's News Corp. (NWS), which until recently had a wobbly Internet presence, now testifies to the hugeness of the online opportunity.

Speaking at a Citigroup media conference in Phoenix on Monday, Murdoch said the company will continue to build its Web side, following last year's purchases of IGN Entertainment for $650 million and MySpace.com for $580 million. "The Internet is the ultimate provider of choice," said Murdoch.

Murdoch says that some day soon, everyone will have access to a computer and the Internet, and that this universal broadband access will only accelerate trends recently warming the likes of Google (GOOG) and Yahoo! (YHOO) and cooling print-heavy outfits like New York Times (NYT).

Murdoch cited the recent "flat" results among traditional media properties as a wake-up call to get into the game. He went on to say that "on its current trajectory," he anticipates the News Corp. online properties will generate $350 million to $400 million in revenue in 2007.

Recent Internet buys underscore a new reality for media companies that also boast traditional assets. Aggregating a big audience is one thing, but making money off it is quite another.

Asked about his Internet strategy, Murdoch says there are now 47 million people on myspace.com, and "it's growing faster than ever at about 1 million new people per week."

To grow the offering, Murdoch hopes to make it "more sticky" when it soon offers free video downloads, of which he figures there will be millions. He hopes to follow that shortly with instant messaging and voice services too.

"There are unbelievable numbers of not just teen-agers spending a lot of time on myspace, these are the people who are reading less newspapers and who are watching less TV," Murdoch says.