News Corp's Chernin on Evolving Media

News Corp's (NWS) President and COO Peter Chernin took the hot seat, talking about competition and the 'MySpace effect." Fortune's media correspondent Richard Siklos interviewed Chernin in front of attendees of the Fortune Brainstorm: Tech Conference. In an event crammed with Chernin's competition -- other media and tech execs -- Chernin says the competitive set is "much less relevant." There's so much competition, infinite possibilities, Chernin says he thinks of News Corp's biggest competitor as itself and its own limitations.

There's been a ton of buzz about Facebook here at Brainstorm:Tech, so MySpace is a natural topic. News Corp bought MySpace for a steal, a mere $580 million, making News Corp seem quite forward thinking. (Facebook's value is some $15 billion based on a Microsoft (MSFT) investment.) So Siklos asked "Is there a MySpace effect" -- i.e. is the acquisition changing the way the rest of the company does different?

Chernin says MySpace helps push the company to focus on the consumer experience even more directly, for example with Hulu, which News Corp is co-owns with NBC Universal. But what about monetization? MySpace may have the number one marketshare in social networking and millions upon millions of page views and users but it's still ten percent short of billion dollar target.

It seems MySpace's challenge growing advertising is the same one other online sites face: there's infinite inventory, so it's tough to convince advertisers of a certain banner ad's value. Chernin's solution? Creating category scarcity, which is easiest to create with premium video, simply because there's less of it. He said the company's challenge is to convince advertisers that the eyeballs they should reach aren't on portals, but are on social networks, pointing out that the MySpace homepage gets more than his American Idol. It may be a while before advertisers look at a banner buy as a mass media opportunity like a Super Bowl ad but he has a point.

Chernin is also bullish on mobile -- News Corp co-owns mobile video startup Jamba. But it sounds like Chernin thinks the real mobile potential hasn't been tapped yet. Media companies have been talking about mobile for years. At every one of these conferences I go to, plus all the CES and National Association of Broadcaster type events, it's always a hot topic. Maybe the new iPhones so many of the folks here are toting will push mobile distribution along.