News Corp. chairman Rupert Murdoch saw his total compensation fall 14% in fiscal 2008, mainly due to an accounting change that reduced the value of his retirement plan.
Murdoch raked in about $27.5 million in fiscal 2008, including an $8.1 million salary and a $17.5 million earnings-per-share bonus, up from $15.8 million in fiscal 2007.
The total was about $5 million less than the $32.1 million Murdoch raked in during the prior fiscal year. The difference was primarily due to a change in the way the value of the chairman's retirement plan is calculated. In fiscal 2007, News estimated that the value of Murdoch's retirement plan increased $6.9 million. In fiscal 2008, because of the accounting change, no increase in value was recorded.
If the retirement benefits are excluded, Murdoch's compensation rose about 9% for the year.
Only one of the company's top five executives saw a gross increase in their compensation for the year — Fox News Channel chairman and CEO Roger Ailes.
Ailes' total compensation rose more than 80% to $19.9 million from $10.8 million in the prior year, fueled by a more than $8 million increase in the executive's annual stock award.
Ailes — who is in charge of the company's flagship cable news network, Fox News Channel, its recently launched Fox Business Network and its owned-and-operated television stations — maintained the same annual salary ($5 million) and bonus ($1 million) as in the prior year, but his stock awards ballooned to $9.2 million from $1.6 million in fiscal 2007, mainly tied to the successful October launch of the Fox Business Network to about 30 million homes. Ailes' non-equity incentive compensation also rose to $4.5 million from $3 million in the prior year, based on the strong cash flow performance of Fox News Channel.
Fox News has long been the performance leader among News Corp.'s cable networks and fiscal 2008 was no exception. According to News Corp.'s 10-K annual report issued earlier this year, Fox News reported operating income growth of 14% in the fiscal fourth quarter and 35% growth for the full year. The cable networks as a whole reported 10% operating-income growth in the quarter and 16% for the full year.
For the full year, Fox News's viewership was 59% higher than its nearest competitor in primetime and nearly 54% higher on a 24-hour basis. Rounding out the executive compensation ranks were News Corp. president and chief operating officer Peter Chernin, whose compensation for the year fell by 15% to $28.8 million, partly due to the accounting change and partly because of smaller stock awards.
Chernin's annual salary stayed constant at $8.1 million, but his stock awards dipped to $10.2 million from $12.9 million in the prior year. Chernin's pension plan rose in value by about $221,947 (compared to a $1.1 million increase in fiscal 2007). The chief operating officer's EPS bonus rose from $10.4 million in fiscal 2007 to $11.25 million.
Chief financial officer David DeVoe also experienced a decrease in annual compensation — 17% to $9.7 million from $11.7 million — for much the same reasons as Chernin. DeVoe's annual salary was unchanged at $2.853 million, but his stock awards declined slightly to $2.99 million from $3.2 million in 2007 and his retirement plan showed no increase in value in fiscal 2008, compared to a $790,000 gain in fiscal 2007.
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