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Executives

Greg Maffei - President & CEO

Chris Shean - CFO

Chris Albrecht - CEO, Starz LLC

Analysts

Doug Mitchelson - Deutsche Bank

James Ratcliffe - Barclays Capital

Brandon Ross - BTIG

Ben Mogil - Stifel Nicolaus

Tony Wible - Janney

Martin Pyykkonen - Wedge Partners

Barton Crockett - Lazard Capital Markets

Liberty Media Corporation (LINTA) Q3 2011 Earnings Call November 8, 2011 11:15 AM ET

Operator

Good day and welcome to the Liberty Media Corporation Quarterly Earnings Conference Call. Today's call is being recorded.

This call includes certain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, including statements about financial guidance, business strategies, market potential, future financial performance, new service and product launches and other materials that are not historical facts.

These forward-looking statements involve many risks and uncertainties that could cause actual results to differ materially from those expressed or implied by such statements, including without limitation possible changes in market acceptance of new products or services, competitive issues, regulatory issues at continued access to capital on terms acceptable to Liberty Media.

These forward-looking statements speak only as of the date of this call, and Liberty Media expressly disclaims any obligation or undertaking to disseminate any updates or revisions to any forward-looking statements contained herein to reflect any change in Liberty Media’s expectations with regard thereto, or any change in events, conditions, or circumstances on which any statement is based.

On today’s call, we will discuss certain non-GAAP financial measures, including adjusted OIBDA. The required definitions and reconciliations, preliminary notes and schedules one through three can be found at the end of this presentation.

At this time, for opening remarks and introductions, I would like to turn the call over to the President and Chief Executive Officer, Mr. Greg Maffei. Please go ahead, sir.

Greg Maffei

Thank you, and good morning to all of you and thank you for joining us today and for your continued interest in the newly created Liberty Media.

Today, speaking on the call, I will have the Chris’s, our newly created CFO, Chris Shean; and Starz CEO, Chris Albrecht. Also available on the call we will have several other senior Liberty and Starz executives, all of us will be available to answer questions at the end.

Liberty Media was created by the split off, which was finally achieved on September 23rd, of Liberty Capital and Liberty Starz. Liberty Starz has one last quarter of attribution issues around Starz Media still affecting the numbers. Going forward, we will be clean. But looking at the business, we had strong subscriber growth at Starz, subs were up over 9%, and Encore subs were up over 3% over last year.

We also had strong revenue and adjusted OIBDA results. We gave you the new series Boss on the 21st of October to very positive revenues. I think it’s a great show, one I enjoy watching and I encourage you to look as well. And what many of you have been waiting for, we finally began repurchasing stock in Liberty Starz; we bought back $51 million worth or 807,000 shares through the 31st of October.

Looking at Liberty Capital, we made a strategic investment in Barnes & Noble, through a convertible preferred stock. That stock converts into about 16.6% common equity stake in Barnes & Nobel. It has a 7.75 quarterly dividend. We also took two Board seats at Barnes & Nobel and we are excited about the things they are doing. And so many of you yesterday saw the exciting announcements they made around two new nooks, an update to the color nook and an update to their lower NDE in greater both of which garnered very positive reviews.

During the quarter we also repurchased $169 million or 2.5 million shares of Liberty Capital.

Looking at some of our larger constituent investments, Sirius XM posted very strong results driven by an excellent operating performance. They ended the quarter with over 21.3 million subscribers. Adjusted EBIDTA at Sirius was up 16%. Free cash flow was up 22%, and they continued to reduce their financial leverage.

We also saw very good results at Live Nation, another of our investing companies. Adjusted operating income at Live Nation increased just about 7%. The concert AOI adjusted operating income increased about 35%. Free cash flow was almost up 5% and we saw some excellent and exciting continued innovation there. High facebook engagement, a dynamic pricing tool, they introduced, which is looks at the inventory and tried to maximize the value of it, for a venue owner, and a joint venture with Groupon, which in UK, is away to an attractive fashion, help make sure excess inventory is moved. All exciting and all very positive at Live Nation.

With that, let me turn over to Chris Shean to talk in more detail about our financial results.

Chris Shean

Thanks Greg. The results for Starz for the three months ended September 30th, 2011, include both the Legacy Starz Entertainment business, as well as the Legacy Starz Media business, as a result of the reattribution that took place on September 30th, of last year. So in order to have a better comparison we have also combined the historical periods, so that we have apples to apples for this discussion.

Starz LLC’s revenue decreased 2% to $389 million for the third quarter. This decrease is primarily due to a decrease in the number of theoretical films released on home video, a decrease in animation revenue, and no theoretical films released in 2011. That’s offset by higher effective rates and increased subscriber counts at the Starz channels.

Adjusted OIBDA increased to $107 million or 27%. At quarter end, Liberty Starz had attributed cash of $1.1 billion and attributed debt of only $41 million. From August 1st, through October 31st, approximately 807,000 shares of L-Starz a common stock were repurchased at an average price of $62.85 with total cash consideration of $50.7 million.

And with that we will have Chris Albrecht comment more deeply on events at Starz.

Chris Albrecht

Good morning. As Chris mentioned, the Starz business has again performed very well in the third quarter. Looking at Starz Entertainment, in addition to solid revenue and OIBDA results, the flagship Starz channel ended the third quarter at 19 million subscribers, while Encore finished at 32.8 million subscribers.

For year-over-year comparisons, Starz subscriptions increased to $1.6 million or 9% versus third quarter 2010, while Encore subscriptions were up 3% or $800,000 in comparison to the same period from a year ago. We realized 71% of this flagship channel growth at consignment rate affiliate that’s boosting our revenue and OIBDA results. However, the growth of our flagship channels during the third quarter of 2011, was hampered by a lack of access to marketing campaigns with certain consignment affiliates, as well as a reduction in subscribers from one flat affiliate deal.

With respect to our digital business, the terrific compliment of Starz originals programming, exclusive first-run movies, and our quality film library content continues to draw a great interest from current and prospective distributors in the marketplace. We are very pleased that AT&T U-verse launched our authenticated Starz online and Encore online services on September 30th.

On the Netflex issue, as we have said on previous calls, maintaining the premium nature of our brand with appropriate wholesale pricing and packaging is critical to potential online distribution agreements. These were the primary factors in our decisions last quarter to end renewal discussions with Netflex. When we consider the underlying business we have with our traditional multi-channel distributors in studios we didn’t believe it was appropriate for the Starz brand to have our products included in a low cost service.

The third quarter marked significant progress on the Starz original front, with several developmental impact positively our future original program in place. Da Vinci's Demons will be the first original series that runs through our new development production and distribution partnership with BBC worldwide production. This is an innovative arrangement that accelerates our ability to meet the ultimate goal of airing annually on Starz approximately 50 hours of original content. We had a structure to mitigate financial risk and reduce total programming cash expended. Da Vinci's Demons is a historical fantasy set in Florence that tells the untold story of Leonardo Da Vinci during his wild youth in the Age of the Renaissance. The story is written by David Goyer who wrote Batman Begins, The Dark Night, and the Upcoming Man of Steel. Da Vinci's Demons and all subsequent programming produced from BBC World -- with the BBC Worldwide partnership will they be exclusively in the United States on Starz. Our worldwide distribution TV group Anchorbay and Starz Digital Media will distribute the programming across television, home video and digital platforms respectively in the U.S. and English-speaking Canada.

Last month, we were also pleased to announce a two-year overall agreement with 'Spartacus Showrunner Steven DeKnight. Steven is a wonderfully creative writer and his enormous talents will give us even more opportunities to bring premium payer to our channels. For our current series Boss, we’ve aired three episodes into the eight-episode first season. We are heartened with the strong buzz and critical acclaim for the series. Interesting Starz affiliate the sampled the first episode of this series, was a record high for the company as more than 76 million multi-channel households offered the first episode early to current and perspective Starz subscribers, in addition to online availability nationwide. We look for Boss to continue to build an audience particularly on the on demand and online platforms and we were delighted to renew it for a second season.

We expect increased marketing and amortization costs in the fourth quarter of 2011 as compared to the fourth quarter of 2010. These increased costs are associated with our new original series Boss and are due to the fact that we did not have an original series in the fourth quarter of 2010. Spartacus returns to Starz on January 27, 2012 with Spartacus Vengeance. The second season will be an epic ten episodes, and there is great interest and enthusiasm around the globe from hardcore and casual fans alike. As you may have read yesterday, we have Green Light the third season with an eye towards 2013 return.

Magic City makes its Starz debut next. Set in Miami Beach circa 1959, Magic City is an eight episode original series from writer, director, producer, Mitch Glazer and features a great international cast led by Jeffrey Dean Morgan and Olga Kurylenko. Magic City was showcased for prospective buyers at the recent MidCom Global Content Marketplace for (inaudible). It was well received as well as Spartacus franchise, which continues to show global appeal. Starz owns all domestic and international rights to Spartacus and Magic City franchise including TV, home video and digital.

Over Starz Media, we have made good progress solidifying the flow of content at Anchor Bay, with a consistent pipeline of new home video products from the Weinstein Company. Starz Originals, Anchor Bay films, and other license titles such as the Walking Dead from AMC.

Recent highlights at Anchor Bay include Spartacus, Gods of the Arena, which is tracking on par in all territories with a highly successful Spartacus Season 1, Blood and Sand, which sold through the consumers more than 400,000 units in the U.S. And also the Walking Dead, which has already sold through more than 500,000 copies to consumers of it’s season.

And with that I will turn the call back over to Chris.

Chris Shean

Okay. Let’s turn to Liberty Capital. Liberty Capital Group’s revenue decreased to $151 million in the third quarter and adjusted OIBDA remained flat at $25 million.

Liberty Capital Group had attributed cash and public investments of $7.1 billion and attributed debt of $750 million. From August 1st through October 31st 2.5 million shares of LCAPA common stock were repurchased at an average prices of $68.15 for a total cash consideration of $168.5 million. Cumulative repurchases since reclassification of the tracking stock represent 41.3% of the original shares outstanding.

The Board recently increased the Liberty Capital repurchase authorization by $500 million, and the current authorization standard of $637.8 million.

Now I will turn the call back over the Greg to wrap it up.

Greg Maffei

Thank you, Chris Shean, and thank you Chris Albrecht for the update on your business. We were pleased with the results of our businesses in what continues to be an uncertain environment for the consumer.

Looking forward our priorities Liberty Starz are to continue to execute on our original content strategy to differentiate and strengthen Starz and it’s brand. We look to build and enhance our relationship with our existing and new distributors. We were evaluating opportunities for the cash on Liberty Starz and for more aggressive balance sheet management.

Looking at Liberty Capital, we also are looking to deploy or invest our excess capital in attractive situations. We look to rationalize some of the non-core investments that are on, that we hold, and to aggressively manage the balance sheet at Liberty Capital as well.

We appreciate your continued interest in Liberty Media. We look forward to seeing many of you in next week at our Investor Meeting. Stay tuned for more announcements. Thank you for listening.

And with that, operator, I'd like to open up the call for questions.

Question-and-Answer Session

Operator

(Operator Instructions) We'll hear first Doug Mitchelson from Deutsche Bank.

Doug Mitchelson - Deutsche Bank

Greg, you bought back stock at pretty terffic prices in the quarter average in the year they're low. I was hoping you could offer your share repurchase philosophy going forward. Was that just a value opportunity or do you expect more consistent share repurchases looking forward?

Greg Maffei

Well, thank you for the compliment on the stock picking, Doug. Look I think we have a case where we try and have a consistent philosophy of return of capital but we also do on the margin try and be thoughtful about leaning in more aggressively when the prices seem to fluctuate low. So, we do not, as a matter of policy, indicate what our plans are in the coming quarter for share repurchase, but I can give you our philosophy, is to return capital when we have in excess and to leaning more heavily when we see attractive value.

Doug Mitchelson - Deutsche Bank

And on the tracking stock structure now that the LINTA split is completed and given your long term strategy of trying to increase value of the stocks, can you talk a bit about the rationale behind having Starz and LCAPA set up as tracking stocks going forward or is there a more ideal structure that you would consider? Thanks.

Greg Maffei

Well, I think you noted our philosophy is for long term value and that is certainly what we are targeting. We think the tracking stocks have been useful in illuminating some of the operations that we have while retaining flexibility for us on some tax matters and in terms of potentially changing the composition of businesses. Now, we have no current plans to change our tracking stock structures but it is also not inconceivable in the future if there was -- we saw a more attractive way to organize or more attractive ways to utilize capital we could change the structure.

Operator

We'll hear next from James Ratcliffe from Barclays Capital.

James Ratcliffe - Barclays Capital

Good morning, thanks for the taking the question. two, if I could. First of all, can you talk about the prospects for getting the Starz online content distributed more widely among your existing sort of MSO, DDS co-ho distributor base beyond the traditional Comcast or the majors content distributors, and what the gating factors around to having that happen are? And secondly, could you clarify why there was the Starz, LCAPA loan in the quarter given that LCAPA seems to be having a lot of cash? Thanks.

Greg Maffei

Chris, you want to talk about Starz?

Chris Albrecht

On the online distribution, we try to work with all our distributors to give them the full array of products that we have available including our online products that will distributors want them integrated into their own platforms. We also realize the value of having our own platform as we see the consumer being interested in that.

As we announced Starz online and Encore online, were just launched by AT&T U-verse and we look forward to more discussions with our traditional distributors and certainly also look to talk to discuss with them any opportunities that we might have together to get our products to them, and packages better more interesting and advantageous to the consumer.

Greg Maffei

Chris Shean do you want to talk about the loan?

Chris Shean

Yeah in anticipation of the spinoff there was some cash balances inside LCAP that we could not access on as a near-term basis, and as a result we put in place this short-term loan across the groups.

James Ratcliffe - Barclays Capital

Great and one follow-up to Chris if I could. Could you just talk a little bit about what sort of response you’ve gotten from your core distributor partners from walking away from the Netflix transaction? How that’s been received?

Chris Albrecht

Well I think that will really be a question that you would see better ask them. I mean we made the decision for ourselves; we looked at the overall Starz business. We evaluate any decision with the net long-term benefit to Starz. This was a decision that we were very comfortable with and it was consistent with things that we’ve said about how we are handling our business and certainly consistent with how we look at it going forward.

Greg Maffei

But if I could add one thought there, the actions we took as Chris has noted were taken because we believed in the premium nature of our product and how it’s best placed in the future. Many of our traditional distributors have embraced that notions fully and I think actions, which we took, which were consistent with their distribution philosophy are only going to be well received and have been commented upon favorably.

Operator

We’ll hear next from Richard Greenfield from BTIG.

Brandon Ross - BTIG

Hi it’s actually Brandon Ross for Rich. A couple of questions. First you mentioned earlier that some of your distributors were not marketing as effectively as other distributors. Just wondering if you could speak to which ones those are and what the issues are?

Chris Albrecht

Well I’ve think, you’ve heard recently from one of the major MPVD’s that they have realized that they would like to focus or refocus their efforts in the premium category. We certainly agree with that decision and look forward to seeing the mutual benefit of that work going forward. And also, we -- well with regard to your question in the marketing campaign I think I will standby that statement as far.

Brandon Ross - BTIG

Okay. And with regard to dish, is the Blockbuster Movie Pass and what they are doing with it permissible under your existing agreement?

Chris Albrecht

Yeah, I mean the Blockbuster Movie Pass is really more now I guess an authenticated service. I mean you have to be a dish subscriber in order to have it. So we are -- we have a very strong rights position with regard to our ability to distribute digitally and the Blockbuster Movie Pass is just one of the ways that our distributors are taking advantage of services that Starz can offer them.

Operator

And you have next from Ben Mogil from Stifel Nicolaus.

Ben Mogil - Stifel Nicolaus

Hi, thanks, good morning, and sort of just following up on the last question. When you guys are looking sort of the premium category in general, a couple of the MSOs were obviously cautious on the demand trend. Do you think that as you sort of leave Netflix potentially that helps out, do you think this is an issue of an economic issue that comes through, curious from a high level perspective, how you sort of see the issue that the MSOs are talking about on sort of where you, what’s your best sort of game plan within that environment?

Greg Maffei

I am not really sure when you say what issues the MSOs are talking about. Could you clarify that?

Ben Mogil - Stifel Nicolaus

Sure, yes, certainly some of the MSOs were noting very weak demand or weaker demand for premium channel. So I am kind of curious when you look at that and you look at sort of the consumers to under pressure is your perspective that as you can see this sort of work more closely with them that’s the best for you and that you will eventually get some more marketing support, which was sort of being weak as you noted earlier this year?

Greg Maffei

Yeah, we haven’t seen weak demand. I mean, we have certainly have seen subscriber growth and when this is really a, I think, and it has been a question of marketing and focus, and we would certainly see the premium business as a win-win for the distributors and obviously for the premium brand. And they cement in a lot of product, they pull-through a lot of product through, and we think that they are realizing the value of those brands and certainly don’t want to turn their backs on a business that’s been good to everybody. I hope that answers your question.

Operator

We’ll take our next question from Tony Wible from Janney.

Tony Wible - Janney

I was hoping you could speak to Starz Media and how we should be thinking about the pipeline of products there and also on that business, what do you guys think about the margin structure? Is that just going to be more of variable cost than margin business or do you expect to see some scale on that business at some point?

Chris Albrecht

With regard to the first question, there has been some transition in the sense that when Anchor Bay released the overture title there was revenue flowing in, whereas with Weinstein deal we have a distribution deal with them. And that’s because of the distribution deal with another company we are also not in charge of what their actual release pattern is and which marketing’s work they put behind it. So there is going to be some variables just in the content flow.

I mean with regard to certain numbers, we also in the last week of September released the Gods of the Arena box set and the Camelot box set. So those -- so third quarter was barely effected by that. But I do think going forward this is a variable business and we certainly look to scale it by trying to leverage that platform not just with our product but with third-party product like we have done with Walking Dead. And Anchor Bay also serves a very important strategic function for the Starz channels providing us with a lot of low-cost theatricals that help us meet our distribution deal requirements. So there is a good strategic and financial reason to have it. It is in areas that are obviously more variable and lower margin than premium television businesses.

Operator

We’ll take our next question from Michael Lima from Putnam Investment Management.

Unidentified Analyst

Hi, it’s Rich (inaudible). It’s been a long time since I have been in the conference call.

Greg Maffei

We knew it was you, come on.

Unidentified Analyst

(inaudible) I used Lima's name.

Greg Maffei

Just teasing, okay.

Unidentified Analyst

For the first time in over two years or a year-and-a-half getting an opportunity to reconstruct your balance sheets to be optimized and that’s a huge opportunity. You talked about a) the relative level of leverage you would like to have on each of the two entities, which I know you’ve discussed in the past but then b) a more sophisticated variation on that, which is how do you compare the efficacy of buying back LCAPA versus buying back Liberty Starz. I know you can’t give us the numbers of the thresholds but talk about the methodology or the philosophy that you used to allocate capital between the levels. So what’s the right debt leverage and how do you calculate the efficacy of buying back stock at the two entities?

Greg Maffei

Okay. First on relative level of leverage, I think for the long-term the right level of leverage at Liberty Capital is effectively zero. It holds basically, very little free cash flow generating assets, it holds mostly a portfolio of investments on which we have substantial value, but don’t get substantial cash flow. We have the minimus amount of that as we consolidate and have access to their cash flow. And when you look at the overhead of the company and flexibility it’s going to be virtually zero.

If you think about Starz, I think it’s a, conservatively it’s a business that could probably support three times leverage. It’s a well capital I mean well run subscription business with high free cash flow generation. So, at the right time over the longer-term, I would say that’s the kind of balance sheet we can support.

When you look at the share repurchase, it’s a little bit of two different decisions. One is a capital allocation issue between investment opportunity externally at Liberty Capital, and share repurchase internally and when we see NAV’s that are attractive on the, of the value accompanying between our own NAV and what the external marketplace is and we find that the underlying securities are relatively attractively priced we execute. And we’ve been doing that and brought back at Liberty Capital over 41% of the stock and driven up the NAV by something like over $30 per share, so that’s been very effective.

At Liberty Starz, it’s a little more complicated only because we’ve talked about some of the strategic issues that we look into to get completed overtime. Chris mentioned some of those today and we reiterate just in case it’s not clear. Continue to grow our original programming strategy, continue to improve our relationship with existing distributors, continue to grow or distribution base, resolve on how we are going to fund some of that original programming, and some of these we have done and checked up. For example no one clean up Starz Media and we’ve to clean that one up, because we’ve set in place a form of the turbo project we outlined with the BBC. We began original programming with some great efforts and more ahead expected. So, we were sort of in a transition process towards what we think is a more certain business there. And, we began because we’ve seen some of that to dip our toe in on share repurchase with more confidence.

Not a statement about what we’re going to do going foreword, but that’s some of the factors that let us do the share repurchase today. I don’t know if that will help Rich in outlining some thoughts.

Unidentified Analyst

Yeah, just one quick follow-up. So, essentially it is the comparison between buying Liberty Starz stock versus buying Liberty Capital since it’s all becoming explicit?

Greg Maffei

I should have been more explicit. Those are two separate decisions. They have their own cash, which has been attributed to each. On the margin they are some liabilities that they share. But those really, given how strongly they capitalize each entity is do not come into play or have not come into play and are thinking about share repurchase. Each is riding on it’s own tub.

Operator

We’ll hear next from Martin Pyykkonen from Wedge Partners.

Martin Pyykkonen - Wedge Partners

The question on the premium versus in older library content when you listened to the last couple of weeks the media companies largely speaking are kind of having a might be in a field in terms of what they are able to license name with their networks and what they are getting. And Greg you’ve mentioned in the past you think it’s likely that somebody else from the digital syndication side would recognize a premium value and they could name kind of all your school Apple, Amazon et cetera without being name specific. Could you access what do you think would be best expectations if there is going to be a deal of that sort premium from a non-traditional digital syndicator, I mean a lot of investor expectation thinking something would happen within a reasonable period. I don’t mean next week but within the next several months. Should people be thinking that way or this is a much longer-term solution from your side, on their side as you see it?

Greg Maffei

I’ll comment and ask Chris to add anything he wishes. But I think you will see digital distributors recognize the means of competition and the ways of competition in the marketplace may vary. You’ve seen some already have different velocities and I think they’ll begin to segment differentially, some will recognize the value premium and price accordingly and setup an offering accordingly. And that’s probably an action or a strategy that we would embrace. Chris, do you want add anything?

Chris Albrecht

Yeah I mean with regard to the first thing you mentioned about other people licensing content. I mean when you look at the list of titles, a lot of the stuff that gets licensed and the things that Starz or Encore brands would never license it’s too deep, old library product.

With regard to entries into the digital space, it might be interested in creating premium tiers. I mean that’s really the prerequisite for us is, are their new distributors that are interested in doing business as consistent with the goals that we have stated. And certainty there are a lot of conversations going on and we looked at all of them and evaluate the long-term benefit to Starz, while also taking into consideration our relationships with our current core distributors and our studio partners. So it certainly would seem that there is a bright future for the new interest in our products. But it’s a road that needs to be evaluated on almost a weekly basis and have prudent long-term decision, thinking, no decision-making thinking at the forefront.

Martin Pyykkonen - Wedge Partners

Okay. And then just one question on the original side, you have obviously done a great job because it sounds like a lot of good scripts and all coming up going into 2013, 50 to 60 hours, four to five series of kind of, in your plan, given back to the question of you got a lot of capital structure headroom there. Could you and are there plans to notably increase that at anytime in the near future in terms of a run rates. Because it seems like you would do that, do it well, and yet have a lot of capital bandwidth, this will do all the other things, I am just curious about this, capital lever of that will go up?

Chris Albrecht

No, we think the 50 to 60 hour model along with our two terrific output deals, Disney and Sony, which are locked in for the next few years at least are a very good program mix, especially given the strategies that the two other major premium brands have. I think Netflix is in a very interesting place. I think we are priced very well with the distributors and we are very comfortable with that model going forward. Should we see some unexpected increased revenue show up, we will certainly look at how we might best deploy that, to get the best returns. But right now we are very comfortable with the model that we are working towards and don’t have any concrete plans to alter it.

Operator

Our final question will come from Barton Crockett, Lazard Capital Markets.

Barton Crockett - Lazard Capital Markets

Thank you for taking the question. I wanted to ask about the comment about the growth and marketing and amortization constant at Starz in the fourth quarter? Can you give us a little bit more elaboration, I mean, what degree of growth, are you still going to be able to grow EBITDA, that’s my initial question.

Chris Albrecht

The answer to the first part is we didn’t have a series in the fourth quarter last year. So, we had a series in the fourth quarter this year and obviously we had to market that. But, as I just said before, our plans going forward have taken into -- that into consideration. As we look at our programming costs both on the film side and on the original programming side, we are going to be very comfortable with the fourth quarter strategy of having series air along with robust marketing campaigns and still be able to grow the bottom line of the company, hopefully as well the top line of the company.

Barton Crockett - Lazard Capital Markets

Okay. All right. And then switching gears a little bit to capital, Sirius XM has expressed an interest in ramping up share repurchase a bit. They also made a comment at least at the Merrill Lynch Conference that they don’t want to increase Liberty’s control over the company. Raises questions about prospects or some type of agreement, perhaps freezing your boarding interest or some other type of unlocking of your Sirius position. I was wondering if you could comment on your openness to those type of arrangements and your interest in doing that and what the timing might be if working under on an arrangement with Sirius?

Greg Maffei

We haven’t had any discussion with them on that topic.

Barton Crockett - Lazard Capital Markets

Is that something that wait until of March of 2012 even began or?

Greg Maffei

They have just, they said in the past they are leveling, their leverage gets to a reduced enough level that they were going to consider what to do with their return of capital to shareholders or whether they do would seek that and I guess at that time we may have that discussion.

Greg Maffei

Thank you. Thank you all for joining us today and we look forward to seeing as we said, may of you next week in New York.

Operator

This concludes today’s Liberty Media Corporation quarterly earnings conference call. Thank you for attending and have a good day.

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