05/15/2008 05:12 am ET Updated May 25, 2011

News Corp. Web Unit Sees Revenue Drop, Admits It Won't Hit FY 08 Goals

It took a while, but Rupert Murdoch has finally acknowledged that News Corp.'s Web business won't hit the goals he laid out for it last August. Actually, he made Peter Chernin say it: "Let me begining by saying yes, we will fall short of what were very aggressive projections."

Chernin said Fox Interactive (MySpace, IGN, Photobucket, et al) will come in around $900 million at the end of next quarter - missing its $1 billion goal by 10%. This jibes with what we heard last month when FIM revenue boss Mike Barrett was ejected.

More worrisome: FIM revenue actually decreased from Q2, dropping from $233 million to $210 million. News Corp.'s overall quarter was fine, and in line: While both investors and the press spend a lot of time thinking about MySpace, it's still a tiny part of the company.

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