News Corp turns to AI content amid profit decline

Ruport Murdoch's News Corporation has witnessed a substantial decline of 75% in its annual earnings, prompting the American media conglomerate to increasingly rely on cost-efficient AI-generated content. The company, holding titles across the US, UK, and Australia, along with book publishing entities, subscription television, and real estate advertising assets, disclosed a net profit of $187 million ($287 million AUD) for the fiscal year, down from the previous record of $760 million in the prior year.
This decline can be attributed to diminished print and digital advertising within News Corp Australia, a division encompassing the prominent newspaper, The Australian. The UK news division also observed a decrease in print advertising.
For the very first instance, News Corp has garnered over fifty percent of its income from digital channels. The media enterprise is optimistic about the potential of creative AI, which has the capacity to produce written content, visuals, videos, and other multimedia, as a means to stimulate profitability.
News Corp chief executive Robert Thomson said: "That momentum is surely gathering pace in the age of generative AI, which we believe presents a remarkable opportunity to create a new stream of revenues, while allowing us to reduce costs across the business. We are already in active negotiations to establish a value for our unique content sets and (intellectual property) that will play a crucial role in the future of AI.”
The Australian division of the company recently divulged that it currently generates 3,000 articles per week through creative AI.
The newspaper portfolio also encompasses The Sun and The Times in London, alongside the New York Post.
Revenue for the twelve months culminating on June 30th reached $9.9 billion ($15.1 billion AUD), a 5% contraction in comparison to the preceding year. The financial metrics were partially impacted by a one-week shortfall in the 2022-23 period relative to the prior fiscal year.
The company's segment focusing on business news, the Dow Jones unit, demonstrated exceptional performance, posting its most robust profitability to date. The Foxtel business profited from heightened subscriptions to its Binge and Kayo streaming services.
News Corp recently achieved cost reductions through extensive workforce reductions.