Here’s the formal language: “The Company recorded a $275 million pre-tax charge for the impairment of goodwill related to the Digital Media Group and an organizational restructuring at MySpace.”

Translation: Firing people en masse, as we did at Myspace last quarter, is expensive. Also, we’re writing down a lot of the social networking company’s remaining value.

I’ve asked News Corp. (which also owns this Web site) for more clarity on the charge: How much of it stems from layoffs? How much of it comes from a writedown on Myspace’s value? And were any other assets involved? At this point the company’s Digital Media Group is pretty much just Myspace, but it does have other stuff there, most notably its IGN site.

It’s worth noting that during today’s unveiling of the Daily, the company’s iPad newspaper, CEO Rupert Murdoch said that the company had already written down the first $30 million it had invested in the project. So it’s entirely possible that that figure is part of the $275 million.

More if I get it. And I”ll be back at 4:30 pm ET to cover News Corp.’s earnings call live.

UPDATE: For the record, News Corp.’s $275 million charge on its digital operations, announced today, breaks down this way: $107 million of that is for restructuring, and the remaining $168 million is a writedown, presumably focused on Myspace.

And for those who care–costs for the Daily are being assigned to News Corp.’s publishing group: $7 million of the $30 million it has spent so far were assigned to this quarter.

In a bit of coincidental timing, said Gnip CEO Jud Valeski, the filing for the round was posted yesterday on the SEC site (which is where I found it). He confirmed the round amount as $2 million, coming mostly from previous investor Foundry Group and including First Round Capital again. This brings the company to $6.6 million raised so far.

Gnip’s deal with Twitter finally brings pricing clarity to usage of Twitter’s data streams, at least for analytics and monitoring companies. The company has permission to collect significant revenue on the streams. Previously, Twitter’s only paid data option was the Firehose full stream of all user status messages, for which it charged different amounts depending on the size of the customer and what it was doing with the data. While Microsoft paid $10 million to incorporate the Firehose into its real-time search, some start-ups that create Twitter clients were getting the Firehose for free.

As I reported yesterday, Gnip will offer social media monitoring companies the Halfhose (50 percent of Tweets at a cost of $30,000 per month), the Decahose (10 percent of Tweets for $5,000 per month) and the Mentionhose (all mentions of a user including @replies and re-Tweets for $20,000 per month), with the caveat that they can’t publicly display the data.

Boulder, Colo.-based Gnip has gone through a big turnaround in the last year. In September ’09, it laid off seven of its 12-person staff, saying the huge increase in creation of social media data had overwhelmed the company’s self-built database and it needed to start over. In May of this year CEO Eric Marcoullier left the company, leaving it in the hands of his co-founder Valeski. Marcoullier, who had previously founded IGN and MyBlogLog, is now working on another start-up, the “Foursquare for Web sites” OneTrueFan.

But a deal with Twitter–a company that has historically expanded into its developers’ territory much to their dismay, rather than blessing third-party companies with partnerships–is a firm indication that Gnip is back on track.

The latest move: News Corp. has acquired Making Fun, a one-year-old social games start-up, and will fold it into the gaming unit it started up earlier this year.

Sean Ryan, who is overseeing the games business, says he’ll put Making Fun’s talent to work building out a platform designed to support games on Facebook, Myspace, Apple’s iPhone and Google’s Android. The move comes six months after News Corp.’s first social games move, when it picked up game developer Irata Labs. (News Corp. also owns Dow Jones, which owns this site.)

Ryan wouldn’t disclose a price for the deal, but it’s likely a modest one, given that this is essentially an “acqhire” of Making Fun’s small team, particularly founders John Welch and Lee Crawford. Ryan will also pick up the Making Fun name. He’ll use it to brand his mini-division, which is attached to, but separate from, News Corp.’s IGN gaming review site.

Ryan says his first games will debut early next year on Facebook and Myspace, followed by ports to iPhone and Android.

But the troubled Web property is a…really troubled Web property, its News Corp. parent stressed today. And it needs to get its act together before it gets kicked off campus.

That’s the message that COO Chase Carey took pains to get across during his company’s earnings call this afternoon.

Revenue at Myspace was down $70 million compared to the same quarter a year ago, the company said, and “traffic numbers are still not going in the right direction, Carey said. Which means that its “current losses are not acceptable or sustainable.”

Okay. But Myspace has been in decline for some time, and Jon Miller and Mike Jones have been trying to fix it for more than a year. And last year at this time, we heard a similar assessment, only then Carey kept calling the site a “work in progress.” So how much more time do they have?

Carey: “We judge in quarters, not in years.”

My understanding is that when Miller took the job as News Corp.’s chief digital officer in the spring of 2009, he believed he had a real shot at fixing the social network, which had already cooled from red-hot to not at all.

But sources in and out of News Corp. tell me that Miller and his team are now merely hoping to patch the service long enough to find a buyer. Perhaps no one has told Carey, who seems to be conducting an anti-sales pitch.

——————-

EARLIER:

First look at Rupert Murdoch’s latest report card: News Corp. ended the September quarter with revenue of $7.4 billion and earnings of $0.27 a share (after factoring out a one-time tax gain). That’s almost exactly what the Street was looking for–expectations were $7.4 billion and $0.24 per share.

A quick run-through by unit:

• Cable: Up, because ad dollars are up and so are those affiliate fees that cable providers don’t want to pay but do.
• Movies: Down, because last year the company had an “Ice Age” movie in its results, and this year it’s fairly hit-less. It is making money selling reruns of “How I Met Your Mother,” though.
• Broadcast TV: Up, because local TV stations are doing better than last year, when they were still crippled by the recession.
• Satellite: Down, because costs were up.
• Publishing: Up, because newspapers are doing better than last year, when they were terrible. Ad revenue is up 13 percent worldwide. (This is where I note that News Corp. owns Dow Jones, which owns this site.)
• Random other stuff: Down, in large part because of Myspace and the rest of News Corp.’s digital unit, which is still trying to turn around.

I’ll come back to liveblog the conference call at 4:30 eastern, in the hopes that Murdoch says something interesting about politics, pay walls, the economy, Myspace, Apple and/or Google. He usually does!

LIVEBLOG:

BIG bummer: No Rupert on call today–because he’s traveling. (Some place with no phones? What’s up with that?)

CFO Dave DeVoe running through segment performance.

Cable: Some boasting about Fox News, FX, Big 10 Network, etc.

Movies: Nothing new here.

TV: TV stations up, but broadcast network losses up big “from higher cancellation costs.”

Satellite: [Apologies, had to duck out for a second.]

Newspapers: Again, ads up in all big newspapers.

Other/Digital: $70 million lower search and ad revenue at Myspace y/y.

Guidance: Leaving unchanged (though DeVoe notes that Myspace is still under plan).

COO Chase Carey:

Lots of focus on our retrans deals, and they are “critical” to our future. “We will be taking this business to a whole new level of profitability.”

Lots of growth ahead in International pay TV market.

Walk through of “key initiatives” throughout the company.

[Still sulking over Rupert-less call.]

Fox Film hasn’t had breakout hits, but no stinkers “in an industry known for them.”

We’ve got Jim Cameron locked up for Avatar 2 and 3, you know. And Modern Family is going to make us a pile of money in syndication.

Wish the World Series wasn’t such a bummer, and a short one. But NFL on Fox doing great.

WSJ still growing. Building digital business that “will take time to emerge.” “We feel very good” about subscription business in U.K.

“We’ve been clear that Myspace has been a problem.”

But relaunching “and we feel really good about” it. “Current losses are not acceptable or sustainable” and current management knows it, even though it’s not their fault.

But we know that we have to work very hard in coming months to get this thing sustainable.

[This is some of the most negative commentary I've heard yet from News Corp. on Myspace. Hard to sell an asset when you're describing it this way.]

Q&A:

Myspace: How much time do you give the relaunch to figure out if it’s successful. And what if it’s not?

Carey: We judge in quarters, not in years. Goal is to get to a place where top-line revenue is going in the right direction and “a clear path to profitability.”

We feel good about the relaunch. But “our traffic numbers are still not going in the right direction” and we have to stabilize that.

Fox TV content on digital platforms: It’s available on Hulu and Fox.com. How is that strategy going, and will you continue to be open?

Carey: Broadly: “This digital arena is still evolving.” We’re very focused on managing rights. Key issues: Windows, ad load, pricing. [Not answering at all, really.] “We think the digital arena is a very important one” particularly mobile, iPad, but “look, scarcity of our product is a real value.” But we’re learning as we go. “I do think it’s important that the digital platforms continue to develop dual revenue stream options.” That’s critical, and options are just beginning to evolve.

More on Myspace: There are a lot of operations in “other” besides Myspace: Mobile, Fox Audience Network, etc. What else could improve there?

Carey: Only two other businesses in there: Mobile, and outdoor networks, (and IGN). Not a lot of room for growth in those businesses.

So it’s really about Myspace?

Yes.

Avatar: What’s upside here?

Carey: Sequel to the most successful film ever? It should be pretty good! “Enormous events, without comparison or rival.”

[Please bring Rupert back!]

Please talk about terms of new Cameron deal?

Nope.

On retrans: Cablevision said they got better terms by holding out for a couple weeks. How do you react to that? If true, will we see more of these holdouts?

[Also a question about BSkyB I'm not that interested in.]

Carey: Mostly I saw Cablevision complaining that the government didn’t bail them out. But we feel pretty good about where we are. We didn’t think the government needed to get into it, and it would have been nice if the government would have been clear up front “it may not have gone off the air at all,” but whatever–”this was a matter to be dealt with between private parties.” [Ignore all those press releases we sent out!]

Can you talk about advertising trends and expectations?

DeVoe [I think]: They haven’t changed.

Cable margins: How long can you keep growing them?

Carey: We have room to drive a number of our channels, via more distribution, jacking up fees, advertising, etc.

What about getting more money from regional sports networks?

Carey: Won’t get into specifics.

[We want Rupe! We want Rupe!]

International channels seem to be doing well. Where is that growth coming from?

Carey: Part of it is the weak U.S. dollar. But overall, growth is “big and broad.”

Oh man. Even Chase Carey is yawning as he answers the question.

[Skipping accounting question.]

Back to network TV: Please talk about sports programming costs, etc. NFL, baseball, NASCAR. You spend a lot. Does retrans help support those costs? Or will you move some of that to cable?

Carey: I don’t think it makes sense to differentiate broadcast and cable much anymore. That’s the point of retrans–to make broadcast look like cable, with dual revenue stream.

On sports: It’s expensive, and draws big crowds. “It’s a unique strength in a world of DVRS” but “they come with big price tags.” We’d like to continue running it, but we have to do it at the right price.

Retrans does help, though–networks that are only ad-supported won’t be able to pay for these rights over time. Still, gotta be disciplined, etc.

Back to digital: What’s going on with Google TV? Are you thinking about different devices and different screens as a way to window, instead of calendar? I.e.: Make it available on PC but not on the big screen, etc.

Carey: I think within the house, the difference between screens won’t matter. I do think mobile is a discrete platform. [And some general chatter about tablets.]

But generally, “our content is incredibly valuable” and “we’re not going to throw it out there for everybody” unless we get compensated for it.

[Boring question about syndicated TV. Carey flipping through papers]

Hey, what about M&A deals, like Yahoo?

“Things like Yahoo are because the press needs things to write about.” [Zing! Also, hey, Jon Miller!] “We don’t need to make any acquisitions. But if there’s something out there, we should consider it, but we’ll do it in a very disciplined way” like we have in the past. Generally, we’d rather build than buy. “But if we see something we can acquire at a very attractive price that fits, we’ll take a look at it.” We’re not shopping.

[Skipping another cable channel question.]

Time for press Q&A:

How do you make broadcast look more like cable?

Carey: Retrans fees, like we’ve been talking about for the past couple years.

What about doing “premium video” (windowing movie release on TV?).

Carey: Looking at it.

What about further delaying movies to Netflix, Redbox beyond 28-day window (Warner talked about this today)?

Carey: We’re okay right now, but we’re looking at it. But as VOD grows, windows will change and evolve. But right now “we feel what windowing we’ve done has been good for us.”

Color on Apple TV 99-cent rental, please:

Carey: It’s pretty new. Only relevant for the past month or so. Too early to judge.

What’s your vision for European and British markets after you buy Sky? Will you buy Endemol?

Carey: Don’t really want to talk about it, too early.

Please talk about Times of London pay wall performance to date. Also, what are you thinking about your iPad newspaper in the U.S.?

Carey: Re U.K.: “We feel very good about it. Realistically, it’s very early….This is not something that’s a one or two quarter game.”

Same thing with the “whole digital arena” evolving, etc.

Hah. Refuses to talk about iPad newspaper. Which is not a newspaper!

Call finished, mercifully.

The companies haven’t disclosed a purchase price, but a person familiar with the transaction said it was a cash deal in the “low- to mid-seven figures.” I assume, but don’t know, that there’s an earn-out clause as part of the deal.

Last month, Break announced plans to start developing its own lightweight Web games, following a path blazed by the likes of Zynga and Playfish, a unit of Electronic Arts (ERTS). FileFront comes at gaming from a different perspective–like News Corp.’s (NWS) IGN and CBS’s (CBS) GameSpot, it is heavy on videos, reviews, and guides, etc., to big-budget videogames, typically played on Sony’s (SNE) PS3 or Microsoft’s (MSFT) Xbox 360 consoles.

Here’s the Flixster/MySpace deal Kara Swisher sussed out on Christmas Eve: News Corp. is handing over its Rotten Tomatoes movie review site, previously owned by its IGN unit, to the movie-centric social network and will get an equity stake in the combined company.

MySpace COO Michael Jones approves, which is good, since the Flixster/Rotten Tomatoes combo is supposed to link directly into MySpace.

This is part of News Corp.’s (NWS) turnaround/shape-up strategy for MySpace and the rest of its digital portfolio, which looked very valuable just a few years ago and is now in need of an overhaul. The media company is shedding noncore assets while trying to turn MySpace into a hub for entertainment that you share with your pals. Expect to see more announcements and product rollouts in the coming weeks.

From Swisher’s 12/24 story:

Several sources noted that this deal being contemplated is typical of the overall strategy at News Corp., which has been targeting digital units that are not an obvious fit inside the company any longer for sale or other disposition.

In fact, the deal is not unlike one News Corp. did recently, flipping photo-sharing Photobucket into mobile photo service Ontela, with the media giant holding a large equity position in the the new entity.

The possibility of linking MySpace and the combined social movie site is interesting and yet another signal of one of the new strategies of MySpace: “Playing on other platforms,” as one source described it.

For example, MySpace recently announced it was adding its data stream to real-time search results on Google (GOOG).

And, it seems dead obvious that MySpace is likely to adopt Facebook Connect sooner than later, perhaps beginning with a smaller implementation early next year.

Disclosure: News Corp. owns this Web site.

Here’s the official press release:

Flixster Inc. Acquires Rotten Tomatoes
From IGN Entertainment

Combination of Top Brands Creates a Leader in the? Online Movie Space, Reaching 30 Million Monthly Moviegoers; IGN to Receive Equity Stake in Flixster

SAN FRANCISCO (January 4, 2010)–Flixster Inc., producer of the world’s largest online movie community at www.Flixster.com, today announced that it has acquired Rotten Tomatoes from IGN Entertainment. IGN, a division of News Corporation, will receive a minority equity stake in Flixster as part of the acquisition. Financial terms of the transaction were not disclosed.

The combination of Flixster and Rotten Tomatoes reaches a huge global movie audience of an estimated 30 million monthly visitors worldwide across multiple platforms: on the Internet, through web-based social networks, and via mobile apps for the iPhone, Blackberry and Android devices.

Both Flixster and Rotten Tomatoes will continue to be available to movie fans as individual properties. Together, Flixster and Rotten Tomatoes give movie audiences an unprecedented total picture of movie trends and opinions, combining half a million reviews from leading critics with 2.3 billion user ratings and reviews.

“To use movie terminology, we think this is a blockbuster double-bill,” said Joe Greenstein, co-founder and CEO of Flixster. “It’s a huge step forward in our goal of connecting users to their own personalized world of movies on any platform they choose. We can’t think of a better pairing for movie fans and our technology partners.”

Flixster’s president and COO Steve Polsky added, “Rotten Tomatoes has built a fantastically well-known brand that moviegoers trust when making their decisions. Combined with Flixster’s social networking and word-of-mouth, we’re creating the leading movie destination on the Internet.”

“Joining Rotten Tomatoes with Flixster creates a company that can dominate the online movie category,” said Roy Bahat, president of IGN Entertainment, who will join Flixster’s board of directors as an observer. “This also enables IGN to focus on serving the male 18-to-34 audience–especially videogamers–and the advertisers looking to reach them.”

Flixster already operates the leading embedded movie applications on Facebook, MySpace, Bebo, iGoogle, and for the iPhone, Android devices, Blackberry and Palm Pre. Together, Flixster and Rotten Tomatoes will be the most comprehensive, one-stop movie-information provider for both end users and technology partners, including: a database of more than 250,000 movies; 2.3 billion user reviews; 500,000 critic reviews; more than 20,000 trailers and videos; the well-known Tomatometer™ and Flixster Scores; unique movie news and editorial content; category-leading social-networking features; localized movie showtime information; theater maps; and online ticketing.

Prior to the acquisition, Flixster and Rotten Tomatoes partnered in several areas, including a recent deal that syndicates critic reviews from Rotten Tomatoes to Flixster’s online movie community, both on the Web and via Flixster’s mobile apps.

Since its inception in early 2006, Flixster has rapidly become the Web’s largest community for movie fans, with more than 20 million monthly users.

As the web’s leading aggregator of reviews from top movie critics, Rotten Tomatoes offers the most comprehensive guide to movies, and its Tomatometer™ rating-based on the published opinions of hundreds of film critics–is a trusted measurement of movie quality for millions of moviegoers. The site has also seen tremendous year-over year growth, with its monthly unique user base rising on average nearly 40 percent in each of the past five months compared to the same months in 2008.

The deal follows a series of moves by IGN Entertainment to refocus its efforts on building out its suite of game-related and men’s-lifestyle offerings. The company recently launched Game On, a videogames-dedicated portal on MSN, and its network of sites currently reaches the most concentrated audience of males 18 to 34 and technology influencers on the Web today.

What else would you expect Ballmer to say? Now that Microsoft (MSFT) has got its hands on Yahoo’s (YHOO) search business–without paying a “boatload” for it–there isn’t a whole lot left to buy.

Emphasis on the word “buy.” Microsoft may still be willing to write a big check to boost its search share, specifically to get its hands on queries controlled by Time Warner’s (TWX) AOL, which has about three percent of the domestic search market.

AOL currently outsources its queries to Google (GOOG) in a deal that is said to make quite a bit of money for both sides of the table because AOL’s core user base tends to click through at a much higher rate than the rest of the Web. But AOL’s Google contract is expiring, and both Mountain View and Redmond are thought to be in hot pursuit of a new one. AOL CEO Tim Armstrong, though, is taking his time about his decision.

Also in the potential mix for Microsoft: A deal with News Corp. (NWS), which owns this site. Google’s $900 million search deal with News Corp.’s MySpace and IGN sites expires next year, but unlike the AOL deal, it has been a disappointment for Google.

It’s hard to imagine Ballmer spending much to wrest that one away, but News Corp. digital boss Jon Miller is doing what he can to drum up interest: He’s been talking up the idea of bundling multiple News Corp. properties–like, say, Dow Jones–into a larger deal. But since many of those properties have their own particular agreements and peculiarities, that’s going to take some doing.

J Moses, who co-founded the company in 1998, left in June, as did Michael McCracken, his longtime COO. The company is currently being run by Hearst Interactive president Ken Bronfin.

I’ve heard conflicting reports about the impetus behind Moses’s departure. It’s certainly not unusual for top executives to leave a company within a couple of years of an acquisition.

But UGO, which competes for eyeballs and ad dollars with heavyweights like CBS’s (CBS) GameSpot and News Corp.’s (NWS) IGN, seems to have had trouble moving the needle since magazine giant Hearst picked it up: Web measurement service comScore (SCOR) says UGO’s traffic has bounced around in the 10 million to 12 million unique visitors per month range–even after it acquired rival site 1up.com from Ziff Davis Gaming Group last January (click chart to enlarge).
I’ve reached out to Moses, but haven’t heard back. Here’s Hearst’s description of what happened:

Moses told UGO employees at a meeting at UGO on June 16 that after two years, he was leaving the company, having fulfilled his duties there.  At the meeting, we thanked him for his dedication to the company and announced that we would begin conducting a search for a replacement. We are committed to the future growth of UGO and believe in its future success. Ken Bronfin, president, Hearst Interactive Media, and his team are managing the company in the interim.

At the time of the Hearst deal, UGO was generating Ebitda of $6 million on revenue of $30 million, according to this Forbes story.

The layoffs at Fox Interactive Media moved on to Photobucket today, as one-third of its staff of about 120 were let go, sources close to the situation said.

The photo- and video-hosting service was bought for $250 million in mid-2007 by News Corp. (NWS).

A FIM spokesperson confirmed the layoffs after being contacted by BoomTown, but declined to give specific numbers. But sources told me a total of up to 75 people were fired.

“As part of our continuing review of each of the FIM business units, employees were informed of job cuts today at several of our sites. We made these cuts to ensure that our resources are aligned properly with our business goals, and at a scale that will enable us to operate as efficiently as possible,” said the FIM spokesperson.

It is all part of a series of job cuts that are now hitting FIM properties other than MySpace.

The social-networking site has seen massive layoffs over the last two weeks, both in the U.S. and internationally.

Photobucket was hardest kicked, with 35 people fired, while other properties, such as the IGN videogame and entertainment unit, had the other layoffs spread among them.

Cuts at IGN, for example, were minimal, and it was also hiring in other parts of its business.

FIM’s whole structure itself is undergoing a shift, along with a likely name change, as BoomTown previously reported.

(Full disclosure: News Corp. owns Dow Jones, which owns this site.)

Mike Angus, EVP and General Counsel of Fox Interactive Media, is departing that job for another in New Corp. (NWS), as new digital head Jon Miller continues to reshape the division.

Last week, BoomTown reported that FIM CFO Ed McKenna was leaving his post and also the company, part of many changes taking place related to News Corp.’s digital properties. (News Corp. owns Dow Jones, which owns this Web site.)

It’s all part of a major rejiggering of FIM, which came into being almost four years ago, although not an elimination of the unit, as has been reported.

More likely, it will include a name change–perhaps to the Digital Media Group–as well as a much streamlined organization that gives more autonomy to FIM’s Web, online advertising and publishing technology units.

The largest of those Internet sites in FIM is, of course, MySpace.

Since Miller arrived in the early spring, he has focused on fixing the troubled, but still huge, social-networking site.

He quickly replaced its co-founder and CEO, Chris DeWolfe, with new managers.

Those execs, led by former Facebook exec Owen Van Natta, have done massive layoffs at MySpace recently and are now beginning a major overhaul of its product, which needs to innovate after a fall-off of growth and engagement.

“In a lot of ways, FIM has become an artificial construct and a lot of the infrastructure it has created should be out in the individual businesses,” said one person close to the situation. “So, since it is not really an operating unit, it will be taken down to the minimal size to make it work.”

That apparently means it does not need a separate CFO or even a general counsel.

Currently, there are about 100 FIM-only employees, mostly in human resources, accounting and legal. Some of those will likely be farmed out to the units they primarily service or be let go if those units decide they do not need the staff.

The original idea of FIM was to create a unit to house most of News Corp.’s standalone digital units, including MySpace and IGN videogame and entertainment sites, and to have common financial, legal and even ad sales execs to serve them.

The concept is that they all had tech, legal, policy and synergistic reasons for being together.

Said a News Corp. press release from July 2005, which announced both the Angus and McKenna hires:

“News Corporation today announced the formation of Fox Interactive Media (FIM), a new unit that will leverage the strength of Fox’s distinctive entertainment, news and sports brands across the Internet to offer a richer online experience to its millions of users.”

That construct, said many people I interviewed inside and outside News Corp., was built to accommodate a much larger unit, with additional large acquisitions after the MySpace one.

Those never happened, although News Corp. was in many such talks with giants such as Yahoo (YHOO), Time Warner (TWX) online unit AOL and Microsoft (MSFT) about trading assets.

“Over time, FIM became more like a shadow government,” said one person familiar with the situation. “Now, it makes sense for the properties to govern themselves, with a lot less meddling and let them rise and fall on their own.”

Many News Corp. sources point to the success of premium video service Hulu, which is run as a joint venture with GE (GE) unit NBC Universal, as being managed relatively autonomously by experienced Internet execs with less corporate involvement.

The result has been a popular and fast-growing site, which has gotten kudos for its innovative consumer offering (although it is still working on finding a highly lucrative business model).

Does that mean that some units, such as MySpace, could even be spun out again?

Doubtful for now, said several sources, but still a possibility.

In any case, the idea of a corporate layer over corporate units within a larger corporation does seem less than fleet in the faster-moving Web 2.0 world.

As to the new name of the unit, besides the chief digital officer title, Miller also was given the title of chairman and CEO of the newly created News Digital Media group.

Therefore, several sources said that the units could be under a simpler and lighter Digital Media Group umbrella.

Quote from CEO Rupert Murdoch: “Our results for the quarter are a direct reflection of the grim economic climate. While we anticipated a weakening, the downturn is more severe and likely longer lasting than previously thought. As a result, we have been taking actions to preserve a solid level of operational profitability and a strong balance sheet without sacrificing future growth. We are implementing rigorous cost-cutting across all operations and reducing head count where appropriate. We believe our businesses are well positioned to withstand a lengthy downturn and to emerge stronger as the current economic situation improves.”

News Corp. (NWS) knocked down guidance for the rest of its fiscal year (which ends this summer) again: Last fall it had said it would expect operating income to drop to the low- to mid-teen range for FY ’09; today it says it’s planning on a 30 percent decline.

Excluding the write-down, the company posted earnings of 12 cents a share on revenue of $7.9 billion; Wall Street had been looking for 19 cents and $8.39 billion, respectively. Including the charge, the company lost $6.4 billion, or $2.45 a share.

Murdoch’s comments about things being worse than he thought should be more worrisome than similar quotes we’ve heard from other media CEOs. That’s because Murdoch has been one of the most bearish of moguls since last spring. And last fall, he began guiding down expectations again.

But the market seems to be taking all of this in stride, and News Corp. shares were up slightly in aftermarket trading. Either investors are relieved that things aren’t worse or they are encouraged by Murdoch’s remarks, which were peppered with both pledges to cut costs and an optimistic refrain that things will get better one day.

Here’s the breakdown of the company’s operating performance–note the huge drop in the company’s TV business (click to enlarge):

MySpace/Fox Interactive Media falls under “other.” Here’s some more info on that from the release: “The decline in FIM operating results was driven by increased costs associated with the growth in unique users, international expansion, the launch of MySpace music and new features, as well as lower subscription revenue at IGN.”

Update from the call: FIM revenues of $226 million are down three percent year-over-year, due to lower subscription rates at IGN, the game-centric business News Corp. bought around the same time as MySpace in 2005. The good news: MySpace ad revenues are flat compared to last year, which is pretty good, considering the rest of the Web.

Asked about his views on the Web as an ad medium in general, Murdoch gave a nuanced but fairly mainstream take: It’s great to sell search ads, but the rest of the online ad business is plagued by an “almost infinite increase in inventory” which keeps pushing rates down. On MySpace: “In the social-network area, we’re getting 80 to 90 percent of total revenue, but that is not a particularly relevant number….We need to find new ways to monetize our huge audience.”

The breakdown on the write-off:

$4.6 billion on “indefinite-lived intangibles (primarily FCC licenses)”
$3.6 billion of goodwill
$185 million on “Newspapers and Information Services fixed assets”

Still reading? Then you should know that Murdoch still doesn’t want to buy the New York Times: “I’ve got no interest. I’ve got no desire to be an even bigger public enemy. Or target.”