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Executives

Gregory Maffei – President, Chief Executive Officer

Christopher Shean – EVP, Chief Financial Officer

Chris Albrecht – President, CEO, Starz LLC

Analysts

Doug Mitchelson – Deutsche Bank

James Ratcliffe – Barclays Capital

Brandon Ross – BTIG

Benjamin Mogil – Stifel Nicolaus

Tony Wible – Janney Capital Markets

Martin Pyykkonen – Wedge Partners

Barton Crockett – Lazard Capital Market

Liberty Media Corporation (LSTZA) 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 of our 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 involves 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 and market acceptance of new products or services, competitive issues, regulatory issues that continue to assess the 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 statement 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 such statement is based.

On today’s call we will discuss certain non-GAAP financial measures including adjusted or EBITDA. The required definitions and reconciliations, preliminary notes, and schedules one, two, three, can be found at the end of the presentation. At this time for open the remarks and introduction I would like to turn the call over to the President and Chief Executive Officer Mr. Greg Maffei. Please go ahead sir.

Gregory 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'll have Chris, who is our new lean created Chief Financial Officer, Christ Shean, and Starz CEO, Chris Albrecht. Also available on the call we'll 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 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 or EBITDA results. We debuted a new series Boss on October 21st to very positive reviews. I think it’s a great show, I enjoyed watching it 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 October 31st. Looking at Liberty Capital we made a strategic investment in Barnes & Noble through a convertible preferred stock. That stock converts into about a 16.6% common equity stake in Barnes & Noble. It has a 7¾ quarterly dividend. We also took two board seats at Barnes & Noble and we are excited about the things they are doing. Many of you yesterday saw the exciting announcement they made around two new nooks, an update to the Color Nook and an update to their lower end E-Ink Reader both of which garnered very positive reviews.

During the quarter we also repurchased a $169 million or 2.5 million shares of Liberty Capital. Looking at some of our larger constituent investments SiriusXM posted very strong results driven by an excellent operating performance. They ended the quarter with over 21.3 million subscribers.

Adjusted EBITDA at Sirius was up 16%, free cash flow was up 22% and they continue to reduce their financial leverage. We also saw very good results at Live Nation, another of our investee companies. Adjusted operating income at Live Nation increased just about 7%. The concert AOI adjusted operating income increased about 35%. Free cash flow was up almost 5% and we saw some excellent and exciting continued innovation there. High Facebook engagement, dynamic pricing tool they introduced which is looks at the inventory and tries to maximize the value of it for a venue owner, and a joint venture with Groupon which is a way to in an attractive fashion help make sure excess inventory is moved. All exiting 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 30, 2011 include both the legacy at Starz entertainment business as well as the Legacy Starz Media business as a result of their 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 theatrical films released on home video, a decrease in animation revenue and no theatrical 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’ common stock were repurchased at an average price $62.85, or total cash consideration of $50.7 million.

With that we’ll 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 with 19 million subscribers, while Encore finished at 32.8 million subscribers. For year-over-year comparison Starz’ subscriptions increased 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 affiliates that’s boosting our revenue and OIBDA results. However, the growth of our flagship channels during the third quarter of 2011 was tampered 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’s originals programming exclusive first run movies and our quality film library content, continues to draw great interest from current and prospective distributors in the marketplace. We’re very pleased with AT&T U-verse launched our authenticated Starz online and Encore online services on September 30th.

On the Netflix issue as we’ve said on previous calls, maintaining the premium nature of our brand with appropriate wholesale pricing and packaging is critical to potential online distribution agreements. There were – these were the primary factors in our decision last quarter to enter into new discussions with Netflix. When we consider the underlying business we have with us our traditional multichannel distributors and 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’s original front with several developments that will impact positively our future original program. Da Vinci 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 have 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 wrote Batman Begins, the Dark Knight and the upcoming Man of Steel.

Da Vinci's Demons and all subsequent programming produced with the BBC Worldwide partnership will debut exclusively in the United States on Starz. Our worldwide distribution TV group Anchor Bay and Starz Digital Media will distribute the programming across television, home video and digital platforms respectively in the US and English speaking Canada.

Last month we were also pleased to announce a two year overall agreement with Spartacus show writer Steven DeKnight. Steven is a wonderfully creative writer and his enormous talents will give us even more opportunities to bring premium fare to our channels.

For our current series Boss we’ve aired three episodes. We are three episodes into the eight episodes for a season, we’re heartened with strong buzz in critical acclaim for the series. Interest from Starz affiliate to sample the first episode of the series was a record high for the company as more than 76 million multichannel households offered the first episode early to current and prospective Starz subscribers 1IN 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 run 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 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 10 episodes and there is great interest and enthusiasm around the globe from hardcore and casual fans alike. As you may have read yesterday we’ve green light for 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 great international cast led by Jeffrey Dean Morgan and Olga Kurylenko. Magic City would showcase for prospective buyers at the recent MIPCOM global content market place event in Cannes. It was well received, as was the Spartacus franchise which continue to show global appeal. Starz owns all domestic and international rights to Spartacus and Magic City franchise including TV, home video, and digital.

Over to 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 licensed titles such as the Walking Dead from AMC.

Recent highlights at Anchor Bay include Spartacus Gods of the Arena, which is tracking on Parnell territories with a highly successful Spartacus season one Blood and Sand, which sold through the consumers more than 400,000 units in the U.S. and also the Walking Dead which is already sold through more than 500,000 copies to consumers of its season one.

With that I will turn the call back over to Chris.

Chris Shean

Okay, let's turn to Liberty Capital. Liberty Capital Groups revenue decreased to a $151 million in the third quarter and adjusted OIBDA remained flat at $25 million. The 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 price $68.15, total cash consideration of a $168.5 million.

(Inaudible) repurchase assistance, reclassification of the tracking stock represents 41.3% of the original shares outstanding. The board recently increased the Liberty Capital repurchase authorization by $500 million and the current authorization stands at $637.8 million. I will turn the call back over to Greg to wrap it up.

Greg Maffei

Thank you Chris Shean, and thank you Chris Albrecht for the update on your business. We are pleased with the results of our businesses in what continues to be an uncertain environment for the consumer. Looking forward our priorities at Liberty Starz are to continue to execute on our original content strategy, to differentiate and strengthen Starz and its brand. We look to build and enhance our relationship with our existing and new distributors. We are 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 next week at our investor meeting. Stay tuned for more announcements. Thank you for listening and with that operator I would like to open up the call for questions.

Question-and-Answer Session

Operator

Thank you. (Operator Instructions) We will hear first from Doug Mitchelson from Deutsche Bank.

Doug Mitchelson – Deutsche Bank

Thanks so much. Greg, you bought back stock at pretty terrific prices in the quarter average near their lows. I was hoping you could offer your share purchase velocity going forward. Is that just a value opportunity or do you expect more consistent share purchases looking forward?

Greg Maffei

Well, thank you for the compliment on our stock taking 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 trying to 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 overall philosophy is to return capital where we have its access and to lean in more heavily when we see attractive value.

Doug Mitchelson – Deutsche Bank

And on the tracking stock structure now that the length of split is completed 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 sort of us tracking stocks going forward or is there a more ideal structure that you would consider? Thanks.

Greg Maffei

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 and some tax matters, and in terms of potentially changing the composition of businesses. We have no current plans to change our tracking stock structures, but it’s also not inconceivable that in the future if there was – if we saw more attractive way to organize the stocks or more attractive way to utilize capital we could change the structure.

Doug Mitchelson – Deutsche Bank

Thanks very much.

Operator

We will hear next from James Ratcliffe from Barclays Capital.

James Ratcliffe – Barclays Capital

Good morning, thanks for 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 MSO, DBS, Telco distributor base beyond basically Dish and Comcast the other major distributors. And what the gating factors around having that happen are. And secondly, could you clarify why there was the Starz capital loan in the quarter given that LCAPA seems to be having a lot of cash? Thanks.

Greg Maffei

Chris, do you want to talk about the first part?

Chris Albrecht

On the online distribution we tried to work with all our distributors to give them the full array of products that we have available including our online products. Several distributors want them integrated into their own platforms. We also realized 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 discuss with them any opportunities that we might have together to get our products to them in packages that are 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 spin off there were some cash balances inside LCAPA that we could not access on a near term basis, and as a result we couldn’t place this short term loan across the groups.

James Ratcliffe – Barclays Capital

Great. One follow-up for 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 would really be a question that you would be better asking 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 benefits to Starz. This was a decision that we were very comfortable with and it was consistent with things that we have said about how we are handling our business and certainly consistent with how we look at it going forward

But if I could add one thought here. 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 notion 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.

James Ratcliffe – Barclays Capital

Great, thank you.

Operator

We will hear next from Richard Greenfield with 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?

Greg Maffei

Well, I think you heard recently from one of the major MTBB 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. Also, well, with regard to your question in the marketing campaign, I think I’ll stand by that statement.

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?

Greg Maffei

Yeah, I mean the blockbuster movie pass is really more analogous than authenticated service. I mean you have to be a Dish subscriber in order to have it. So, we have a very strong rights possession 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 the services that Starz is going to offer them.

Brandon Ross – BTIG

Great, thank you.

Operator

We will hear next from Ben Mogil from Stifel Nicolaus.

Benjamin Mogil – Stifel Nicolaus

Hi, thanks, good morning. And sort of just following up on the last question. What you guys are looking at is for the premium category in general and couple of DMSOs where we are obviously cautious on the demand trends. Do you think that as you sort of leave Netflix potentially that helps out? Do you think this is an issue, an economic issue? Like I'm sort of curious from a higher level perspective how you sort of see the issue that DMSOs are talking about and sort of what’s your best sort of game plan within that environment?

Greg Maffei

I'm not really sure when you say what issues DMSOs are talking about, could you clarify that?

Benjamin Mogil – Stifel Nicolaus

Sure, yes. I mean couple of DMSOs were noticing a very weaker demand for premium channels. So, I'm kind of curious when you look at that and you look at sort of – the consumer is still under pressure. Is your perspective that as you continue to 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 weak as you noted earlier this year.

Greg Maffei

Yeah, we haven’t seen weak demand. I mean, we certainly have seen subscriber growth and when – this is really, I think it always has been a question of marketing and focus, and we certainly see the premium business as a win-win for distributors and obviously for the premium brands. 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.

Benjamin Mogil – Stifel Nicolaus

Yeah absolutely, thanks.

Operator

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

Tony Wible – Janney Capital Markets

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

Greg Maffei

With regard to the first question, there's been some transition in the sense that when Anchor Bay released the overture titles that was revenue flowing in, whereas with the Weinstein deal we have a distribution deal with them. And that’s – because of the distribution deal with another company we’re also not in charge of what the actual release pattern is, how much marketing support were behind it. So there's 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, the third quarter was barely affected 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 what we’ve 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 business is.

Tony Wible – Janney Capital Markets

Okay Thank you.

Operator

We’ll take our next question from Michael Lima (ph) PSM Investment Management.

Unidentified Analyst

Hi it’s Rich Fuwadi (ph). It’s been a long time. For the first time in over two years or year and half, getting opportunity to reconstruct your balance sheets to be optimized, and that’s a huge opportunity. You talk 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 where the philosophy that you use to allocate capital between the level. So what’s the right debt leverage and how do you calculate the efficacy of buying back stock of the two entities?

Greg Maffei

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

Starz, I think it’s a conservatively, you know, conservatively it’s a business that could probably support three times leverage. It’s a well run subscription business with high free cash flow generation. So it’s the right time, over the long term I would say that’s the kind of the 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 NAVs that are attractive on the – of the value of the between our own NAV and what the external market place is, and we find that the underlying securities are relatively attractively priced we execute, and we have been doing that and bought 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’re looking to get completed over time. Chris mentioned some of those today and I’ll reiterate just in case it’s not clear, continue to grow original programming strategy, continue to improve our relationship with existing distributors, continue to grow our distribution base, resolve on how we’re going to fund some of that original programming, and some of these we’ve done and checked off. For example, you know, we cleaned up Starz Media, and while we cleaned that one up we’ve set in place a form of the turbo project we outlined with the BBC, we’ve begun original programming with some great efforts and more ahead expected.

So, we are 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 we’ve more confidence. Not a statement about what we’re going to do going forward but that’s some of the factors that led up to do the share purchase today. I don’t know if that’s helpful Rich in outlining some thoughts.

Unidentified Analyst

Yeah, just one quick follow-up. So, essentially the comparison between buying Liberty Starz stock versus buying Liberty Capital (inaudible).

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 there are some liabilities that they share but those really, given how strongly capitalized each entity is, do not come into play or has not come into play in our thinking about share purchase. Each is riding on its own tug.

Unidentified Analyst

Terrific, thank you so much.

Operator

We will hear next from Martin Pyykkonen from Wedge Partners.

Martin Pyykkonen – Wedge Partners

Yeah, thanks. Good morning. A question on premium versus older library content. When you listen to last couple of weeks the media companies largely speaking are kind of having in my opinion a feel there in terms of what they are able to license namely the Netflix and what they are getting. And Greg you’ve mentioned in the past you think it’s likely that somebody else from a digital syndication side would recognize a premium value. I think the names are kind of obvious Google, Apple, Amazon, etc. without being named specific. Could you say what you think would be best expectations that if there is going to be a deal of that sort of premium from a non-traditional digital syndicator I think a lot of investor expectations 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 is this a much longer term solution from your side and their side as you see it?

Greg Maffei

I will comment on that and ask Chris to add if he wishes. Look, I think you will see digital distributors recognize the means of competition and the ways of competition in the market place may vary. You are seeing some already have different philosophies and I think they will begin to segment differentiating some will recognize the value of premium and price accordingly and setup an offering accordingly. That’s probably an action or a strategy that we would embrace. Chris, do you want to add anything?

Chris Albrecht

Yeah, I mean, I think 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 are things that Starz or Encore brands would never license. It’s too deep old library product. With regard to entries into the digital space that might be interested in creating premium tiers I mean that’s really the prerequisite for us is are there new distributors that are interested in doing business that’s consistent with the goals that we stated. And, certainly there are a lot of conversations going on and we will look 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 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-making thinking at forefront.

Martin Pyykkonen – Wedge Partners

Okay. And then just one question on the original side. You’ve always done a great job, and it sounds like a lot of good scripts and all coming up going into 2013, 50 to 60 hours, four to five series kind of in your plan. Given back to the question of, you’ve got a lot of capital structure headroom there. Could you – and kind of other plans to notably increase that at any time in the near future in terms of the run rates because it seems like you do that, do it well and you can have lot of capital bandwidth, this will do all the other things, just curious if that will go up.

Chris Albrecht

No, we think that 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 it nestles us 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 return, but right now I think we are very comfortable with the model that we are working towards and don’t have any concrete plans to alter it.

Martin Pyykkonen – Wedge Partners

Okay, thanks.

Operator

Our final question will come from Barton Crockett from Lazard Capital Market.

Barton Crockett – Lazard Capital Market

Okay, thank you for taking the question. I wanted to ask about the comment about growth in marketing and amortization cost at Starz during the fourth quarter. Can you give us a little bit more elaboration? I mean what degree of growth, I mean, are you 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 of last year, so we had a series in the fourth quarter of this year and obviously we had to market that. But as I just said before our plans going forward have taken that into consideration and as we look at our programming costs on 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 Sirius air along with robust marketing campaigns and still be able to grow the bottom-line of the company and hopefully as well the top-line of the company.

Barton Crockett – Lazard Capital Market

Okay, all right. Switching gears a little bit to capital, SiriusXM has expressed an interest in wrapping up share repurchase, but 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. That raises questions about prospects for 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 or what the timing might be of working an arrangement with Sirius?

Greg Maffei

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

Barton Crockett – Lazard Capital Market

And that’s something that wait until March of 2012 to even began or?

Greg Maffei

They have said in the past that when their leverage gets to reducing of level that they will consider what to do with their – you know, to return the capital to shareholders or whether they would seek that and I guess at that time we may have that discussion.

Barton Crockett – Lazard Capital Market

Okay, all right, thank you very much.

Greg Maffei

Thank you. Thank you all for joining us today and we look forward to seeing as we said many 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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