Reed Nolte - Senior Vice President of Investor Relations David F. DeVoe - Executive Director Chase Carey - President, Chief Operating Officer, Director, Chief Operating Officer of The Media & Entertainment Arm and President of The Media & Entertainment Arm James Rupert Murdoch - Deputy Chief Operating Officer, Director, Chairman of News International and Chief Executive Officer News International

Benjamin Swinburne - Morgan Stanley, Research Division David Bank - RBC Capital Markets, LLC, Research Division Richard Greenfield - BTIG, LLC, Research Division Todd Juenger - Sanford C. Bernstein & Co., LLC., Research Division Michael Nathanson - Nomura Securities Co. Ltd., Research Division Jessica Reif Cohen - BofA Merrill Lynch, Research Division Douglas D. Mitchelson - Deutsche Bank AG, Research Division John Janedis - UBS Investment Bank, Research Division Alan S. Gould - Evercore Partners Inc., Research Division

Ladies and gentlemen, thank you for standing by, and welcome to the News Corporation's Second Quarter 2013 Earnings Release. [Operator Instructions] And today's conference is being recorded. I'd now like to turn the conference over to Reed Nolte, Senior Vice President, Investor Relations, News Corporation.

Thank you very much, Ryan. Hello, everyone, and welcome to our second quarter fiscal 2013 earnings conference call. On the call today are Chase Carey, President and Chief Operating Officer; James Murdoch, Deputy Chief Operating Officer; and Dave DeVoe, our Chief Financial Officer. First, we'll get some prepared remarks on the most recent quarter and we'll be happy to take questions from the investment community. This call may include certain forward-looking information with respect to News Corporation's business and strategy. Actual results could differ materially from what is said. News Corporation's Form 10-Q for the three months ended December 31, 2012, identifies risks and uncertainties that could cause actual results to differ, and these statements are qualified by the cautionary statements contained in such filings. Additionally, this call will include certain non-GAAP financial measurements, the definition of and a reconciliation of such measures can be found on our earnings release and our 10-Q filing. Finally, please note that certain financial measures used in this call, such as segment operating income, adjusted segment operating income and adjusted EPS are expressed on a non-GAAP basis. The GAAP to non-GAAP reconciliation of these non-GAAP measures is included in our earnings release. And with that, I'll turn the call over to David. David F. DeVoe: Reed, thank you, and good afternoon, everyone. As you all have seen in today's earnings release, our second quarter reflected continued solid growth in our Cable Networks, retrans led growth at our Television businesses, and overall improvement at our Publishing segment. Higher earnings contributions from these segments were partially offset by declines in SKY Italia and slightly lower profits at Filmed Entertainment. The current quarter's operating income result also includes: $26 million in cost related to the proposed separation of the company's entertainment and publishing businesses; and a $56 million charge related to the ongoing investigations in the United Kingdom, as compared to $87 million in the second quarter a year ago. Excluding these charges from both years, second quarter adjusted total segment operating income of $1.66 billion increased 5% from the year-ago adjusted result of $1.58 billion. Second quarter reported revenues were up 5%, highlighted by strong Cable Network increases of 18%. All segments reported higher revenues with the exception of SKY Italia, where local currency revenues were essentially unchanged, but reported U.S. dollar revenues declined due to the strong dollar. Our share reported results from our equity earnings and affiliates was up $32 million in the quarter. With this increase, primarily reflecting this quarter's higher gain from participation in BSkyB's share repurchase program, partially offset by a onetime cost at Hulu, resulting from their purchase of Providence 10% ownership stake. Also included in this quarter result is $1.4 billion of income, which is included in Other, primarily from non-cash gains related to our acquisition of remaining ownership stakes in Fox Sports Australia and the ESPN STAR network -- Star Sports, rather. These gains were partially offset by $65 million of pretax restructuring charges. Reported net income in the quarter was $2.38 billion, with reported earnings per share of $1.01 as compared to reported earnings per share a year ago of $0.42. Excluding the net income effects in both years and one-time items, primarily consisting of the items I just highlighted, second quarter adjusted earnings per share this year are $0.44 compared to the year-ago adjusted result of $0.39, a 13% earnings per share improvement. Our press release includes a reconciliation of our GAAP results to these amounts. The reduction of shares outstanding versus last year accounted for a $0.03 per share contribution to adjusted EPS this quarter. Now I'd like to provide some additional context on the performance at a few of our businesses, and let's begin with the Cable Networks. This segment continues to drive overall company results, generating 60% of News Corporation's total segment operating income. Second quarter Cable segment results were driven by an overall 18% revenue increase, reflecting organic, domestic and international channel strength, as well as the inclusion of new international sports networks in Latin America and Asia. Similar to our first quarter, this quarter included the planned increased investments, both in sports rights in the United States and India, as well as the ramp up of international sports channels. These investments are in line with our strategy to create new strong cable sports franchises that will provide the foundation for a whole new level of long-term sustainable earnings growth. Additionally, the current quarter also includes a net negative $45 million impact related to the NBA lockout in the prior year and the NHL lock out in the current quarter. As a result of these investments and the lockout's impact, this quarter's operating income growth moderated to 9% domestically and 3% internationally. Reported affiliate fees at the Cable Networks increased 20% over year-ago levels. Domestic affiliate revenues increased 13% over last year, with particular strength at Fox News and at the RSNs. While reported international affiliate fees were up 42%, after stripping out the effect of the new sports channels and foreign exchange, the affiliate fees increased 17%, reflecting comparable strong local currency organic growth at both the Fox International Channels and at STAR. Second quarter advertising revenues for the segment were up 16% over year-ago levels, with domestic ad growth of 8% and reported international ad increases of 29%. Excluding the new sports channels and foreign exchange, local currency organic advertising growth of our international channels was approximately 20%. Total Cable segment operating expenses increased 20% over the second quarter a year ago, with 1/3 of this increase related to the additional consolidated international sports businesses and the net increase from timing differences associated with the NBA and the NHL lockout. Another 1/3 of this increase is due to expanded college football coverage and Ultimate Fighting Championship rights in the United States, and the launch of our BCCI cricket broadcast in India. As a result of these planned investments, our operating profit margin declined slightly in the quarter as compared to last year. At our Television segment, operating income in the quarter of $224 million increased 19% versus the second quarter a year ago, due to more than doubling of retransmission revenues from higher political advertising at the stations. Political advertising was strong, with approximately $70 million of political advertising revenues received in the quarter, bringing the fiscal 2013 total to over $100 million. These gains more than offset lower national advertising revenues due to weaker network ratings and 3 fewer World Series games this season, as well as higher cost associated with the expanded college football coverage on Fox. At our Film segment, second quarter operating income was $383 million, a very solid result, which is roughly in line with the $393 million generated a year ago. These contributions include the successful theatrical release of Taken 2, as well as 2 late quarter releases, Life of Pi and Lincoln, which are up for the Best Picture. Turning to our DBS segment, SKY Italia. SKY generated an operating loss in the quarter of $20 million as compared to operating income of $6 million in the second quarter a year ago. This decline was driven by higher program expenses, including nearly $30 million of increased cost, primarily associated with expanded UEFA Champions and Europa League coverage. The current challenging economic environment in Italy continues to negatively affect subscriber additions, with SKY reporting a net loss of 28,000 subs in the quarter, bringing the quarter end total subscribers to 4.83 million. Local currency revenues were essentially in line with the second quarter a year ago, with a EUR 1 increase in ARPU being offset by the reduced subscriber base. In our Publishing segment, operating income of $234 million increased 7% compared to a year ago. This improvement result was primarily due to the higher U.K. newspaper contributions from the Sunday edition of The Sun that launched in February of 2012, improved profits at News America and at HarperCollins. These improved results were partially offset by continued lowered advertising revenues at the Australian newspapers. And at our Other segment we reported a second quarter segment operating loss of $186 million, a slight improvement from the $191 million in the same period a year ago. This quarter result includes $56 million of cost related to the ongoing investigations in the U.K., $23 million of cost related to the proposed separation. Additionally, this quarter includes $20 million in contributions from the consolidation of Fox Sports Australia, although these earnings contributions are largely offset by higher development costs at the company's education business. Before I turn to guidance, let me comment on our buyback program. As you have seen, we have been purchasing shares at a $3 billion annual pace while we work through the details of the separation process. Through February 5, we have spent $1.63 billion, repurchasing approximately 68 million shares during this fiscal year. And finally, let me address our guidance for fiscal 2013's total segment operating income. And as a reminder, we measure this guidance excluding from fiscal 2012, with $224 million of charges related to the ongoing investigation in the United Kingdom, resulting in a base of $5.6 billion in segment operating income for comparative purposes. Since our last call we did 3 months ago, we've updated our operational assumptions to reflect our second quarter performance and our outlook for the remainder of our fiscal year, and Chase will expand on this in a moment. But while our Cable and Content Production businesses are all on plan, 3 businesses, SKY Italia, the Fox Network and the Australian newspapers will underdeliver against is our original expectations. As a result of this underperformance, and after excluding the full year's effect of the U.K. investigation cost and separation cost, and based on all of the assumptions inherent in our projections, we expect that our total segment operating income percentage growth rate for fiscal 2013 will now be in the mid to high single-digit range, above the $5.6 billion fiscal 2012 segment operating income base. This outlook also now reflects the consolidation of SKY D's reported operating results from the January, although this factor's -- this does not materially affect the impact of the company's growth rate. Before turning the call over to Chase, I'd like to give you a brief update on our plans to separate our publishing and entertainment businesses into 2 distinct, publicly traded companies. On December 21, we filed a preliminary proxy statement and initial Form 10 Registration Statement with the SEC. We plan to file amended documents, which will include additional financial information in the next month or so. We have also applied for certain regulatory approvals and tax rulings required to enable the transaction be completed as envisioned. At this time, we believe we are on plan for the separation to be completed around the end of the current year. And with that, I now like to turn the call over to Chase for his comments.

Thanks, Dave. It was a busy quarter as we closed a number of important transactions, including acquiring all or part of CMH in Australia, the YES Network, ESS, our Asian sports business, EMM, our new Dutch sports business and a regional sports network in Ohio. We're also making great progress in the planned separation of the company, which is on track for the end of this year, this fiscal year. Each of these acquisitions positions us for further growth. More importantly, we feel good about the momentum in most of our businesses, and excited about the progress on our new growth initiatives. However, as Dave noted, issues at 3 business units have led us to come up a bit short on expected results this year. While disappointed, we are aggressively pursuing steps to address these issues, while ensuring we continue to drive our other businesses forward. I'll address the 3 business units with shortfalls in a minute. Let me start with what is going well. Our domestic Cable business continues to hit every target we set and execute superbly. FX, which is experienced wins on multiple levels, just finished a record-setting month in January, and last week's premier of our newest series, The Americans, had the most total viewers of any drama premier in FX's history. The National Geographic channels made real progress, and Fox News continues to be a juggernaut. At our regional sports network business, we believe we're making the right decisions in navigating this invaluable, yet complicated business. Our new agreement with YES adds America's premier RSN to our portfolio, while our Ohio sports deal further strengthens our hand. Both businesses will generate significant profits and returns that exceed our hurdle rates. Those profits and returns look even more attractive when you look at the recently announced Dodger deal, which was too rich for our blood. We have a strong Southern California RSN with 4 great pro teams without the Dodgers, and our overall RSN portfolio is materially stronger than it has ever been. Beyond our existing U.S. channels, we're preparing some exciting additions to our portfolio, and those efforts are on plan, too. It is a testament to the strength of our U.S. Cable business that will deliver solid double-digit growth while observing over $50 million in cost for new initiatives. Our international channels unit, Fox International Channels or FIC, is pretty much the same story of across-the-board strength and growth, while investing to add new dimensions to the business. In fact, our growth rate at FIC will exceed our domestic channel growth. That growth is helped by a couple of acquisitions, but that benefit is largely offset by some adverse currency fluctuations at the same time. Among our newer initiatives, ESPN branded channels in Asia that we bought out last fall were rebranded Fox Sports just last week. Fox Sports Japan is on track to launch at the end of this quarter. And in Latin America, the Fox Sports business we took over a year ago is the highest-rated regional pay sports channel. At STAR, our results in our historical entertainment businesses are ahead of target and growing this year, again, in spite of currency headwinds. However, as planned, our overall results at STAR this year will be down due to our investments in building a robust Indian sports business. Our content businesses in film and TV have both continued to be industry leaders. On the film side, Life of Pi is a film we are proud of, both creatively and financially. We are excited about the upcoming Die Hard release, and the slate we have as we look toward the summer looks great. On the TV side, we have about 40 scripted entertainment series on broadcast and cable this season, with 18 new pilots picked up today for the upcoming broadcast season across all 4 networks. Our satellite and cable platforms in the U.K., Germany, Australia and India continue to operate well and build on their leadership positions. Germany, in particular, has been an area of focus. We're excited about the recent restructuring that gave us a majority position there. This business has just gotten stronger and stronger in the past few quarters, with both key content and distribution agreements. It is truly establishing itself as the premier video platform in Europe's biggest market, Germany. On the Publishing front, Dow Jones, our U.K. newspapers and HarperCollins have all made progress this year. Navigating the evolving digital age is still priority 1, and we're energized about new initiatives like our agreement with the Premier League for U.K. video clip rights. These businesses have big agendas and are on target, in spite of tough economic conditions. As noted earlier, there are 3 business units not on target, and each warrants discussion. At SKY Italia, our problem is top line shortfalls, primarily in subscribers due to the economic crisis in Italy, particularly during the recent holiday season. We now expect this business to be about $100 million below target this year, around $150 million off last year's results. We do not expect the economy to improve in the short term, so our focus is reducing the cost base, particularly programming costs. We plan to take over $200 million out of the cost base over the next 2 to 3 years by not renewing some agreements and modifying others. We believe this business should and needs to get to a double-digit profit margin, with no improvement in the economy. From there, we can improve the margin and profitability as the economy recovers. A key positive to our Italian situation is that our competitive position is stronger than ever, which bodes well for our medium and long-term future. At the Fox Network, it has been no secret that we had a tough fall. We hoped X Factor would grow as it moved into the competition phase, but it didn't happen. Our challenges in entertainment were exacerbated by a sports schedule that just didn't bounce our way with a 4 game World Series, NFL post-season off double-digits from last year, and late-season college football matchups that didn't pan out. American Idol is just ramping up and our new drama, The Following, is off to a promising start. Nonetheless, the year will fall well short of our expectations. On the positive side, our retransmission results are slightly ahead of target. The growth in retrans will enable us to have a broadcasting business network and stations combined that is significantly up on a year ago, but it will still be well short of our target. In Australia, we've been hammered by an economy that we keep hoping has hit bottom, yet seems to continue to find new lows. This was clearly evident during the holiday season where we were unable to benefit from the seasonal advertising lift as we had in prior years. As stated before, we're actively working to restructure this business for the future. We are highly focused on addressing these challenges. However, at the same time, we don't want to lose sight of the great momentum in our broader businesses. We remain more excited than ever about our opportunities, especially as we get closer to the proposed split, which we're confident will position us to unlock even greater value for our shareholders. Thank you, with that, I'll turn it back to Reed for questions.

Thank you, Dave and Chase. And now Chase, James and Dave would be happy to take your questions.

[Operator Instructions] Our first question comes from the line of Ben Swinburne with Morgan Stanley. Benjamin Swinburne - Morgan Stanley, Research Division: Two questions. Both to get James' thoughts on BSkyB, now that we have this transaction in the U.K. with Virgin and Liberty, and what that might mean for that business and how he thinks about, broadly the satellite platforms in the U.S. as they continue to battle with -- in Europe, excuse me, as they continue to battle with cable properties. And then Chase, on the broadcast network, is there anything on the cost side you are thinking about? You outlined some initiatives at SKY Italia, but I didn't know if you had a view on what might, if anything, you might do on the expense front at the network moving into the latter parts of this calendar year?

James, you want to talk about the U.K. and satellites in general?

I think, really, just with respect to the transaction that was announced with Virgin Media, I would just say that across Europe, particularly in Ireland and in Germany, we compete as well as work with Liberty Global, in Germany where Liberty Global, through Unity and KBW[ph] distribute a lot of our programming for Sky Deutschland. And in Ireland, Sky and Liberty have been competing for some time. So I don't think there's really a big change to the landscape there, and I think, Chase spoke about the progress being made in all of the pay-TV businesses and the platforms in Europe in his remarks, and I don't think I have much to add to that. We're pretty pleased with momentum and we're pleased with the strategic position of the business, notwithstanding some of the sort of short-term issues and current issues that we have in Italy.

Yes, and I think on the broadcast network, I mean, we're always focused on cost, and I think it has to be part of, in some ways, your DNA in managing the business everyday. I don't think there's anything dramatically that we'd be doing. Realistically, our core problem was we didn't have a great fall. You look at the ratings and the shortfall we had in the fall. And then, clearly, that was disappointing to us. We've had a -- The Following's off to a really good start. Idol is, very early stages so, very much a work in progress, but it's not that costs aren't important, but we need to create shows that are franchise shows for us to build a business around. And we're focused on that. We need to have shows that break out, we need to have shows that, and I think The Following is, again the type of show that can be a signature you build a night around. And so yes, we're focused on cost, but I -- and I think we always are, but I think that's the core challenge for us as we go forward.

Comes from the line of David Bank with RBC Capital Markets. David Bank - RBC Capital Markets, LLC, Research Division: Two questions. I guess the first one was, I was wondering if you could update us on any developments you might see on the creation of a Fox national sports network, given a bunch of the rights that you've acquired on the MLB side, and some of your rights to distribute college, what you think the outlook is for that? And the second, I guess for all of you guys, there's been reasons why you've probably been a little bit less active on the buyback front. But could you kind of update us with your long-term perspective in terms of return of capital and capital allocation?

Yes, I guess on sports, I mean we haven't made up an announcement about a national sports channel. I guess it's, what you could call it, the world's worst kept secret, but we think there are opportunities for us to add real dimensions to the business. We think sports is a huge arena that has room in it to build really attractive businesses. And we obviously have a lot of assets in that place that we think we can utilize in terms of trying to build a business, certainly, the regionals as we think are a real business for us. We do want to be focused on building businesses, as opposed to as, I said before, as opposed to acquiring businesses. And we think that's an important part of the portfolio as we look at our -- as we look at that bundle -- our bundle of cable channels that really cover the spectrum of the 4 arenas of entertainment, news, nonfiction and sports. We want to continue to be opportunistic at finding things that -- where we can build real value. We can build businesses that capitalize on the other assets we own. And we do think sports is an opportunity there. We recognize the challenges in terms of dealing with the cost of sports, but we just think sports, in a world of increasing fragmentation, we think sports continues to be a more and more important and unique part of that overall landscape. In terms of the capital question, again, in some ways, as we head towards the split, which is what we've said, you are going to have 2 companies that probably are each going to have their own. So it's a little difficult to get too long term on capital allocation, because again, you're going to have 2 businesses with different outlooks and at different places. And I think each has to sort of determine its own path and then come forward and set out a vision for what it intends to do. We are committed to finishing the buyback we've announced, so that, we said we're going to buy back $3 billion to $4 billion this year. We will do that. We will finish the $5 billion that we've talked about. And I think the company has to get split to then come out with an appropriate, sort of -- each company then has to come out with its own vision for how it deals with it. We think capital -- we think it's an important part of how we manage the business for shareholders. I mean, I think, we certainly know the importance of returning capital, of finding -- returning capital to shareholders. We want to make sure we continue to fulfill opportunities to grow the business, but we believe, fully, hopefully our actions recent last year plus that's indicated that. The Return of capital to shareholders is an important part of it. But again, I don't want to get too specific, because I think you have got to get to each company to sort of, provide its own vision.

Comes from the line of Richard Greenfield, BIG. Richard Greenfield - BTIG, LLC, Research Division: A couple of questions. One, Disney, just to follow on that question about Europe, Disney made comments about looking to exit the U.K., given what's happened with ESPN and losing sports rights. Wanted to get your perspective on kind of what that means for SKY and just, as you think about the sports rights situation overseas, you -- now that you control Sky Deutschland, how you think of -- what's happened at ESPN in terms of your ability to continue to manage sports rights costs as you look out over the course of the next few years? And then, moving it over to the U.S. for a second. With the loss of the Dodgers, you've now lost the Dodgers and the Lakers, can you keep your 2 RSNs going in Los Angeles, and will that ultimately lead to higher profitability because of your affiliate fees being long term in nature?

Yes, and I'll later -- I'll let James, let David can add something, if you want to. I mean, I guess, I don't think -- I have a great respect for ESPN and what they build, I don't think ESPN's plans, I would end up saying could have had a -- would have a significant impact on what we're doing in Europe. I mean, we had a relationship, but there are a lot of other players there, so I don't think ESPN's announcement on the U.K., I'd say, is an event that's -- essentially, we'd say changes our outlook or our plans much one way or the other. I think they'll be out there. I think there are other players that compete for rights. James, you want to, you have any...

No, I would just say it's a super competitive sports market across Europe and in the U.K. Obviously, we had a new entrant with BT very recently. And really, and that package of SAPL rights or those rights had been ESPN's kind of core offering earlier. So -- but it doesn't really change very much as Chase said I don't think -- I think there's a lot of players over there. It's very competitive. But there are plans in Europe one way or another -- haven't really -- haven't been, and I think won't be, a big changing factor. And I think over there, to your kind of second part about managing costs, I think it's about making choices, and either deciding what you have to do, what you'd like to have, what's nice to have and what you're going to stretch for. So across the whole sports portfolio, it's about making choices, about where you want to invest and where you want to prioritize. So -- and that's why we make those choices everyday in a lot of different places.

And I think as it relates to the L.A. market, we don't want to get too far into the weeds on the numbers of channels. Our goal is to maintain the profitability of our business in L.A. -- in Southern California. We've got a number of sports franchises, lots that we have long-term agreements in place. We feel good about our place. We feel our business is going to be more profitable, given the paths we've chosen than any other path out there, and we'll determine how we deal with our existing assets to best achieve that profitability. And again, on another level, I think we do look and we like each of these regional businesses, but in some ways look at them individually, and then we look at them as a portfolio. And there's no question we're in a much stronger place than we were with Ohio and then particularly, yes, than we were a year ago. So as a -- from an overall perspective, we are stronger than we've ever been, and we feel on the more local level, that we can -- we've got a combination of enough assets that we can continue to have a very healthy and vibrant Southern California business.

The line of Todd Juenger with Sanford Bernstein. Todd Juenger - Sanford C. Bernstein & Co., LLC., Research Division: Two quick ones, if I may. So back to the best kept secret in media, I'm sorry to probe a little further on that, but in terms of the idea of a national cable sports network, do you think if you put together the various rights that you hold for a national cable rights right now, or could be reframed in that way, that it's enough for a 24/7 sort of proposition, or do you think you would need some more? And if so, what could that possibly be? And then the second quick one, I know you just took us through a great presentation on Amplify not too long ago. So I know you said a lot about that. I guess I'm left wondering, if you could just comment, do you think that if you continue to spend a couple hundred million dollars a year pursuing that opportunity, that, that's enough to compete with the big incumbent competitors? Or would you be prepared to spend a lot more than that, if necessary?

Yes, again we haven't announced it, and I'm not going to get too far into rights. I mean, we believe we have a unique combination of both rights and assets that we can use to potentially build a very attractive business. And yes, I'm not going to get into a right by right analysis to some degree. There's always -- with rights become affiliate fees. We're navigating a path where we think we have -- if we launch a channel, we're going to launch a channel that we think will excite people, and will interest people, clearly a 24 hour channel is rights as well as programming you create to invest in content genre, to -- that will excite and interest people. We think we have proven a unique capability in the sports business to really do unique and exciting things that excite people. We've certainly greatly expanded the portfolio of rights we've got across an array of sports from NASCAR to baseball to college football, college basketball, soccer, UFC and the like. So we have a broad array of rights as well as the regionals as I touched on to deal with. And clearly, look to create again distinctive content that we create that goes with it that would be interesting and valuable for customers. And then, go out with it on a set of economics that enables it to be an attractive business for us. And that's a plan we're on, and that's what we're planning to execute, and we will provide more details as we go forward. In terms of Amplify, look, we really think we're going to be a disruptor, we're not trying to be the guys that are in it. And that's, to some degree, that's what we've said is we're not planning to go to go toe-to-toe spending. I mean, in some degree, it's taking advantage of guys that are encumbered by decades of having built the business on historical practices, and we're going to come in using digital technologies which the education businesses sort of have been completely left out of, and innovate and then create a completely different approach that we think will prove to be uniquely successful in the education arena. We think they do it very cost effectively. It does regardless. We're not trying to -- I mean, we don't have any plans to go spend toe-to-toe with the old brick-and-mortar guys. I mean, in some ways it's the greatest advantage -- the biggest advantage we have is we don't have to worry about an incumbent business and what do we do, can -- what our digital technologies do in terms of cannibalizing an historical business. We can just lay out and build a digital business, and it's really built taking advantage of today's technologies and deliver a great product. We put a great team in place with unique expertise, and we think we can be a true disruptive force for good in the education space.

Comes from the line of Michael Nathanson with Nomura. Michael Nathanson - Nomura Securities Co. Ltd., Research Division: I have 2,1 would be for Dave or Chase and then second for Chase. So David and/or Chase, on the last call I remember asking about the ratings of Fox Network, and they start off really weakly, we all saw that, and asking about guidance and how that was incorporated. So from November until now, what really got worse? Was it weakness in the ad markets? Did you count on the second half of the season launching better? So that's something that we all were aware of, so I wonder what changed versus the last time you guys updated us?

We think we've really, yes, I mean, we were only halfway there. I mean, I guess most particularly, with X Factor, we had really, obviously, went into the competition round, which is really where we were headed, that we could get a fresh energy and a fresh momentum, and clearly X Factor did -- was a disappointment for us and that didn't occur. So I think probably the first factor would be that. I think the second would be, we had a very choppy October. We were just coming out of October. We had the election, baseball, the hurricane. We had an array of disruptions. And again, we were hoping to relaunch some other shows that really had gone off and subsequently, some of the new shows, Mob Doctor, Tuesday night, and get some traction. Weren't expected to be raging successes, but hoped through those disruptions we could bring them back and to a better place, and that didn't occur. And then in sports, we actually were doing -- look, the NFL's fabulous, but sometimes just like sports were, really, the regular season was great for us. Unfortunately, the postseason didn't fall our way. I mean, we were down double digits, and that's a lot of money. So double digits in the NFL postseason, those are 3-digit millions, ad sales and then on top of that, some of the, I guess probably in college football, particularly the 2 championship games, we start off at 1 point hoping you've got a USC/Oregon top-five matchup, and you don't get that. And you end up with a top 5 team in the Big Ten, that can't play in the championship game in Ohio State, so sort of ended up with signature games that didn't pan out. And so, I just -- and to be aware, every one of those where, maybe we've been because it's early in the year, a little too optimistic and sort of challenging people to sort of achieve. I mean, in sports, I think we did. So sports, I think is more just sort of, that's the way it fell. I think in entertainment, we really believed we could, we had an opportunity to get some of those programs to a better place and really, it just didn't go. It just went the other way as we went through the fall. Michael Nathanson - Nomura Securities Co. Ltd., Research Division: Can you guys actually sell on the sports network which, again, is the worst kept secret, is the gating factor to make an announcement or going more formally down the road, you used -- you just to talk to your distributors and get them to agree to a change, is that the gating factor of why we're all talking about it, but nothing has been announced?

No, I mean actually if we think it's great to have everybody keep asking. So it's, we have a timing for what we're going to do, and we feel good about the timing. If we're launching something next month, I'd have to -- we would have to announce it. We're not, then so we'll continue to build up pent up demand.

That comes from the line of Jessica Reif with Bank of America. Jessica Reif Cohen - BofA Merrill Lynch, Research Division: I guess one last question on sports and then a different topic completely. Just in general, could you give us any sense of what the incremental sports cost will be worldwide over the next, say 2 or 3 years? It seems like there was a really big step-up this year. And then, how quickly would you expect to start to see the flow through via revenue? How quickly will advertising growth accelerate and affiliate fees? So that's one question. And then the second question is you do have a lot of hidden assets, one that comes to mind is The Simpsons. Can you give us any sense there of when second cycle syndication might happen? And what the economic impact of that would be?

So on sports, and I guess if you're talking worldwide, it's tough to make a general statement, and I'm not sure I can do the math in my head to go add up the pieces, I mean, I guess -- but I guess just touching all around the world, and in some places, you ought to, I guess got to remember, particularly in a number of the international markets, what we've done is take businesses that we owned a piece of and taken control of. So in Latin America, we had a minority stake, we took control of it. In Asia we had a 50/50 partnership we've taken control of. So a lot it -- in Australia, we owned half of Fox Sports, and we've taken control of it. So in a number of these initiatives, some of them are new, Fox Sports Japan is new. The Dutch initiative is new. And they're in very different places. I mean, Latin America, which we took control of 1.5 years ago, 1 year or plus ago, is actually ahead of schedule and has turned profitable, and significantly -- generates significant profits that are on course. I think in India, this is a significant investment year, and that should be -- will have a significant uptick as we go into next year on sports there. In the rest of Asia, that's probably more of an ongoing build that is actually in the black today, because it didn't have quite the same cost that you had in India. It's a more competitive market, so there was some more cost to digest in India this year on some key rights, and we're just getting that up. Actually, I think very quickly, essentially, in the Netherlands, that's going to be a profitable business, almost after a very quick turn. I think in the U.S., to the degree we take on a new initiative, I think launching a channel, I mean we -- we don't -- we're not starting from square one. If we do something, it's still probably a couple of years to get us to a place. So I think getting -- there's always going to be an investment phase to the ability to lick our goal. Really, in aggregate, I think as you look at our cable business, has been, to maintain a very healthy growth rate, that has a degree of investment that after that investment, lets us continue to have that -- the type of growth rate you've seen. Obviously, if we did nothing new, then the growth rate would be couple of points higher. We think it makes sense for us that if you did that, at some point, your business has gone up mature in a way that we don't think is right in terms of building long-term value. So our goal is to say how do we take a small portion of that growth and reinvest it in building businesses. And again, we want to build and still be able to maintain a very healthy growth rate. If you see this year, we're building India this year, we're still building in a number of places. So India will mature and it's not just sports. Look, in some ways be built Fox business, which turns profitable this year. It's been Fox News as we've been investing in, it turns profitable this year and takes another jump next year. But I think that's a -- that is the philosophy. Clearly sports has a more significant cost just, again, because of the importance of sports, to the uniqueness of sports that it has a larger cost. Again, I couldn't pull it out of all those territories and stick it together without doing a little homework. But sports, we think, is going to be a force second to none. And really, almost everywhere we've invested in sports around the world, it has been not just important, and in many ways, it's been the cornerstone to our ability to grow and build the businesses we've built, including, here in the U.S. in many ways. In terms of The Simpsons, it's -- we are -- they're still ongoing. We are working hard to get to a place, I wouldn't speculate on a -- I wouldn't take any -- probably to sort of speculate ahead of time what it's worth, it is obviously as unique a franchise as exists in the television world now. I don't think there's anything else out there that has whatever it is, 500, 600 episodes and is headed towards its 25th year. Animation is great because nobody ages. But it's a fabulous franchise, but -- and I think we're getting, and we're hopefully getting close to a place where we can sort of try and add a dimension to it, but we still got a, I guess call it a couple of i's to dot and t's to cross to try and get there, so I'm not going to get ahead of it.

The line of Doug Mitchelson, Deutsche Bank. Douglas D. Mitchelson - Deutsche Bank AG, Research Division: Two questions, for Chase and/or Dave, given the nature of the guidance, the fact you provided a range, can you talk about what you would see as the swing factors that would push you to the high end or the low end of the range these last 5 months of the year? And then, I guess sort of for Chase, with regards to the not yet announced U.S. sports networks, any thoughts around the NFL networks package of games, or whether you pursue those games as a foundation of that network at some point?

I guess the ups and the downs. I guess, first you always get sort of the, just the built-in uncertainty in the content business. We have -- what do films, where do films perform? I think on the network as I said, we're early days on Idol and the spring season, as a whole. I think you go to someplace, in a place like Italy, what we're assuming, yes, we can sort of stabilize subscribers. We've got a couple of initiatives we're trying to do to -- and I think that's sort of the outlook in the short term is stabilize subscribers. They've obviously been -- the last 12 months are down. And yes, we've got a couple of initiatives continuing to add new dimensions to the product. We just launched a bundle of broadbands, so some things we think that we can use to stabilize that market, we don't expect the economy to get better in the next, certainly in the short term, next couple of years so we are planning the business. We're in an economy that won't be, but we'd love to get some traction. We're not planning on that, but again, we're looking to not, we're looking to stabilize it as opposed to the last 12 months, where we've been -- we've had subscribers declining. So I think that still is something that we're focused on. And again, it made some headway in the last month, but it's too early to make any -- to have any real strong feelings about where it is. I mean I will not dwell on Italy, I mean I -- the one thing I do, as we look at that business that I feel good about is, it's a pretty clear path, how to get the business to where it should be. And it's -- you got program contracts that end in the next 12 months, the next 24 months, and some we won't renew and some we'll modify. And it's pretty structural. And I think we do those things, we get the business stabilized on the top line, take those costs down and get ourselves to a double-digit margin, and then we'll go from there as the economy evolves. But back on that, so I started to say the content businesses -- the content-driven businesses, as does span our film network. I think the cable business is probably -- don't have that type of volatility. The publishing business is -- it's pretty tough around the world, a pretty tough advertising market for publishing. We certainly experienced that first and foremost in Australia. We're not expecting it to get better, but we're not expecting it to get substantially worse. I mean as I said in the call, we had hoped the Christmas season, which is usually a good season for the newspapers in Australia, would've given us a bit of a lift and just didn't happen. But I guess I'd say those things and then, there's, we're not -- we're assuming the world itself is reasonably flat. I'm not assuming we're not assuming there are wonders out of Washington or other things that would sort of give it great momentum, but we're assuming the world sort of muddles along. So that's sort of from a macro perspective. Douglas D. Mitchelson - Deutsche Bank AG, Research Division: Great. And then, NFL content first for summer?

Yes, again, I'm not -- look, NFL's a great franchise. We feel very good where we are. I'm not going to sort of speculate on individual rights and -- we are certainly, we're planning our, we're planning it light, given what we know today, and we feel very good about the path we're on, and the opportunity we have. I think you always want to be open minded and opportunistic. There are things there, see if they make sense, and they may or may not. But we're not -- our plans, the plans we have in place we are -- we have what we need to fully execute on. So it would only be if we think there's something that enhances them, the plans we have in place today, we feel great about.

Next question comes from John Janedis with UBS. John Janedis - UBS Investment Bank, Research Division: Chase, just going back to Fox for a second. How do you see programming expense ramping there and try to drive the ravings growth? And does the retrans revenue allow you to take more risk or be more aggressive?

Retrans certainly, I don't know if it makes -- it makes it a healthier business. I don't -- I think we, I wouldn't necessarily say it gives us license to go spend more money. I think we ought to be taking intelligent shots to try to create unique hit programs. Look, content's the heart of this business. There's no question in this digital age, you see it time and time again, great content is invaluable. And it's what you want to create, and I think we need to invest, we need to invest smart and intelligently in creating great content, whether it's at the studio or at the network or at our cable networks. And we will continue to do so. In the reality of retransmission is it enables the broadcast business to be a healthy business. As I said, I mean, we've had a very disappointing year ratings-wise, but our broadcast business is up profitability, and that's because we are building it into a dual revenue business, dual revenue. Then I got to put stations in there because that, really to me, is one business, stations and network combined. It's a dual revenue business, that can be a very exciting, healthy business and a platform on the network really is our ultimate platform to launch franchise entertainment shows and franchise content. And it'd really be a platform to market and sort of build all of our franchises in Television. And we need to continue to invest in content. We need to do it smart and intelligently. I think we've -- I think we've -- we have, I think, done a pretty good job of investing intelligently in content. We just went through a fall where unfortunately, the volatility of the content world didn't work our way. We feel good about the management team out there. We feel they're doing a good job. This is in a business you can measure in a couple of months, and sometimes you're going to have a tough 3 months. That's the nature of the content businesses. But we feel we've got a really good team that has -- is focused on trying to cost-effectively invest. We want to invest directly in content, but build unique, distinct content that can really be the type of franchises that have an ever increasingly unique value in this digital world.

Okay, that comes from the line of Alan Gould with Evercore. Alan S. Gould - Evercore Partners Inc., Research Division: A question for Chase or James. Chase, you've been trying -- you've been doing a good job at rationalizing a lot of these assets, selling some, buying some. The 1 giant asset that stands out there is BSkyB. From our appearance it looks it's too cheap to sell, but sort of too hot an issue to buy. Is there anything you can do to recognize the value of BSkyB, which I think is probably not fully recognized in your stock?

I'll give my two cents, James can add his two cents, hopefully they haven't -- they're not different wildly divergent -- but the -- I mean, first your last comment, I agree with wholeheartedly. It's not -- and I think it's true with all our off balance sheet sets. It's the biggest, and you're right, I mean if -- and I think it's just a question we don't get value or certainly fair value for it. And I think it is incompetent for us to continue to wrestle with that. And it certainly is something we will, but that being said, I think right now we're doing what we sort of have talked with in the past. We obviously went through the process we went through and -- the last couple of years. We've made a determination today that we're going to stay the course we're on, it's a great business. Our focus in the short term is to make sure we continue to make that business as strong as it can be. But I think over time, we need to -- but I think it's not -- it's over time, we need to figure out how do we wrestle that question to the ground and there obviously, I'm not going to get into speculation. Obviously, there are things we could do depending on the direction we want it to go, to capture more value out of the business. I mean, I think, well aware of those, but I think those are things we want to wrestle with carefully because depending on whether you head down a path, it probably precludes -- include other options on the path. So I think we're going to be patient on BSkyB. You know we're thrilled with the business. We're thrilled with the business's prospects and where it's going, and we are very comfortable where we are, and so I agree with the issue. But I think it's something we'll continue to wrestle with internally, and decide what's right as we go forward. Do you want to add anything?

I don't have anything to add to that. But I guess I would say just the one thing is that across the whole portfolio, it is true that over the last couple of years, we have really strived to simplify the operating model, to deal with joint ventures, minorities, et cetera, and there continues to be a lot of work in that area, and we continue to stay very focused on it, and the recent transaction with Sky Deutschland is another good example of that as well, as all of the -- as many of the things Chase mentioned earlier. So these are things that across the whole business, we continue to be very focused on, in terms of simplifying the operating model, the portfolio, and having something that's -- that makes sense for the future.

Thanks, Alan. At this point I would like to conclude the call. If you have any further questions, please call myself or Joe Dorrego here in New York.

Thanks a lot.

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