The Breakfast Meeting: Numbers-Crunchers Defeat Pundits, and Sex Film Industry Is Stung

While everyone was watching how voters would settle the Obama-Romney contest for the presidency, they also settled, for now, another dispute, Michael Cooper writes: the pundits versus the number crunchers. It was the number crunchers in a landslide, as polls - especially when they had been looked at cumulatively as a so-called “polls of polls” - were quite accurate. The political pundits, including those with a partisan bent - like Karl Rove, Dick Morris and Michael Barone - were far from the mark with their predictions of a big Romney victory.

• Karl Rove's awkward on-air confrontation on Fox News on Tuesday night, challenging the decision by Fox News experts to project President Obama's victory in Ohio, exposed the unprecedented role he plays in contemporary politics, Jeremy W. Peters writes. At 11:13 p.m., Mr. Rove, a Fox commentator, was on the phone with a senior Romney campaign adviser who insisted that Fox News had blown the call. Mr. Peters writes of M r. Rove:

Was he acting as the man who oversaw the most expensive advertising assault on a sitting president in history, unable to face his own wounded pride? The fund-raiser who had persuaded wealthy conservatives to give hundreds of millions of dollars and now had a lot of explaining to do? Or the former political strategist for George W. Bush, who saw firsthand how a botched network call could alter the course of a presidential contest?

• The influx of multimillion-dollar campaign contributions from megadonors to the Republican side in the end didn't tip the scales in the presidential race and in many Senate contests. The best that strategists like Mr. Rove could tell these donors, Nicholas Confessore and Jess Bidgood write, is that without the hundreds of millions of dollars the races wouldn't have been as close. And the megadonors still had a deep impact on the 2012 campaigns, they write, including “reshaping the Republican presidential nominating contest, clogging the airwaves with unprecedented amounts of negative advertising and shoring up embattled Republican incumbents in the House.”
• Los Angeles County voters on Tuesday approved a ballot measure that requires actors in pornographic movies to wear condoms. Its backers said they consider it to be a “referendum on the subject of safer sex,” The Los Angeles Times reported. While the industry, which says its system of aggressive testing for H.I.V. has been a success, is threatening to move outside the county. The Times has a nice roundup of commentary on Twitter, including one actor's looking-on-bright-side Tweet: “measure b seemed to pass… Hopefully people will learn safe sex from it and at least now I get to travel… a lot!!!! (Always an up side)”

Nakoula Basseley Nakoula, the man behind the anti-Islam YouTube video that in September ignited bloody protests in the Muslim world, was sentenced to a year in pris on for violating the terms of his parole in a bank fraud case, Brooks Barnes writes. The charges in the plea bargain didn't relate directly to the video, “Innocence of Muslims,” but the prosecutor spoke about Mr. Nakoula's film project - and the deceitful manner in which he carried it out - as part of his sentencing argument.

Noam Cohen edits and writes for the Media Decoder blog. Follow @noamcohen on Twitter.

Stay Tuned...

The FiveThirtyEight team is still recuperating, but the election provided a fresh supply of data points that we'll be connecting in the coming days. How did the FiveThirtyEight model perform? How did the polls do? What are Gov. Chris Christie's odds of winning the White House in 2016? (Just kidding about that last one.)

Thank you for staying with us throughout the campaign, and please, stay tuned.

Profit Rises 16% at CBS on Higher Licensing Fees

The CBS Corporation said on Wednesday that its revenue and earnings increased in the third quarter, reflecting sturdy growth in licensing fees for television shows and subscription fees for stations that more than offset a slight drop in advertising revenue.

CBS's total revenue was $3.42 billion, up from $3.37 billion in the same quarter last year. Its net income rose 16 percent, to $391 million from $338 million last year. Its earnings per share were 60 cents, compared with 50 cents a share last year.

Excluding a one-time adjustment, the company earned $426 million, or 65 cents a share.

Leslie Moonves, CBS's chief executive, attributed the results to a continuing “transformation” of the company into one that relies less on advertising revenue and more on distribution revenue than it used to.

The most recent example of a new distribution deal came on Monday, when the company made a multiyear deal with Hulu to stream episodes of old TV shows like “I Love Lucy” on the Web site.

Mr. Moonves, who signed a contract extension last month, said on a conference call with investors Wednesday afternoon that CBS was considering, for the first time, “opportunities to license past seasons of current CBS and Showtime programming.” Such deals could let viewers catch up on “The Good Wife” or “Homeland” through services like Hulu or Netflix.

Advertising still accounts for more than half of CBS's revenue. In a few months, the network will televise the year's biggest advertising event, the Super Bowl. Mr. Moonves said Wednesday that some 30-second commercial spots during the game had sold for more than $4 million.

But advertising revenue dipped 3 percent companywide in the third quarter, dragged down by weakness at CBS Radio and six nights of pre-empted prime-time shows during the national political conventions. The company's chief financial officer, Joseph Ianniello, said some political ad buys were shifted to the fourth quarter from the third, which ended in September, “as campaigns chose to spend their dollars closer to the election.”

Despite the advertising headwinds, the segment of CBS that includes its broadcast network and its studio posted a 3 percent gain in revenue, in part because of increases in retransmission fees and television license fees. Revenue in the segment that includes its local stations increased 1 percent, with gains at its television stations offset by losses at its radio stations.

Acknowledging a continued drift away from live viewing of prime-time TV shows, Mr. Moonves said CBS would “make it a priority” to get paid by advertisers for all viewing. Ad rates are currently set based on the viewing of commercials within three days of their air date, a standard known as C3, but Mr. Moonves said CBS wanted to be paid for viewing “beyond C3.”

Election Night Ratings Come Close to 2008 Record

While the nation's votes were being counted on Tuesday night, more than 66 million viewers were watching news coverage on a baker's dozen of television channels, according to estimates released by Nielsen on Wednesday.

Viewership came close to matching the modern-day election night ratings record set back in 2008, when 71.5 million viewers watched from 8 to 11 p.m. This year, about 66.8 million viewers were watching on one of the 13 networks with news coverage counted by Nielsen.

President Obama‘s re-election was projected by the major networks between 11 and 11:30 p.m. Nielsen did not release an audience total for that time period. The first network to make the projection, NBC, was also the most-watched one on Tuesday night, with 12.1 million viewers between 8 and 11 p.m. The ratings represented a “resounding victory” for NBC, “grounded in accurate journalism that was on full display last night,” Steve Capus, the NBC News president, said on Wednesday .

Fox News Channel came in second with 11.5 million viewers, followed by ABC with 10.5 million, CNN with 9.3 million, and CBS with 7.9 million. The Fox broadcast network had 4.9 million viewers and MSNBC had 4.7 million.

Hourly ratings were not immediately available for the broadcast networks, so it was impossible to say how many viewers stayed awake for Mr. Obama's victory speech at 1:45 a.m. But the hourly ratings for Fox News, CNN and MSNBC showed a stark difference in viewer behavior. Fox News had 10.1 million viewers in the 11 p.m. hour when it named Mr. Obama the winner of the election, but just 2.7 million viewers in the 1 a.m. hour when Mr. Obama spoke. CNN, on the other hand, had 10.7 million viewers at 11 p.m., and still had 8.2 million at 1 a.m., indicating a desire to stay up for the president's speech.

Because CNN had a bigger audience into the early morning hours on Wednesday, it was able to declare a rare victory over Fox News between the hou rs of 7 p.m. and 2 a.m.

The Breakfast Meeting: Special Election Hangover Edition

Beyond the candidates, some other assorted winners and losers from last night.

1) Twitter managed an election-night load of traffic and didn't fail.

2) Poll trackers like Nate Silver, TPM's Polltracker and Electoral-vote.com, took on the conventional wisdom of many pundits â€" and came out on top. Their success, as many of them would admit, rest of the relative accuracy of the polls themselves in this election. On Fox News, even Megyn Kelly, the co-anchor, admitted Tuesday night that the polls largely held.

3) Megyn Kelly â€" again â€" turned what could have been a Walk of Shame into one of the evening's most compelling pieces of television. After Karl Rove complained on the air that Fox News had called Ohio too early, Ms. Kelly took a walk through the studio into the backroom where the channel's decision desk was housed and interrogated her own polling experts.

4) Local television stations reaped a windfall in advertising dollars because of the unp recedented spending unleashed by the Citizens United court decision.

5) ABC suffered through a blackout in the middle of its election broadcast.

6) A local news anchor in Ohio said “she had no choice” about taking part in an anti-Obama special that aired on several Sinclair Broadcast Group stations.

Cable Networks Help Time Warner\'s Quarterly Profit

A strong quarter at Time Warner's suite of cable networks contributed to the company's 1.9 percent increase in third-quarter net profit, but revenue was offset by continued weakness at its magazine and movie divisions.

Time Warner reported net income of $838 million in the quarter that ended Sept. 30, or 86 cents a share, compared with $822 million, or 78 cents a share, in the same period last year. Overall revenue at the company fell 3 percent, to $6.8 billion.

The company's networks division, which includes cable channels like TNT, TBS and HBO, reported its best quarter ever, with $1.2 billion in operating income, a 12 percent increase from 2011.

The gap between the high-performing television networks and the company's Time Inc. publishing unit and Warner Brothers movie studio was stark. TBS was up 35 percent in prime-time viewers aged 18 to 49, for example, while at Time Inc. subscription and advertising revenue fell 6 percent and 5 percent.

Ove rall revenue fell 6 percent to $838 million at Time Inc., the publisher of People, Sports Illustrated and Entertainment Weekly among other magazines. Operating income at Time Inc. increased by 2 percent, largely because of cost-cutting.

The company's movie and television studio suffered mostly because of comparisons to the same three-month period last year, which included revenue from hits like “Harry Potter and the Deathly Hallows: Part 2″ and syndication revenue from “The Big Bang Theory.” Revenue at the film and television division fell 12 percent to $2.9 billion, and operating income fell 37 percent to $328 million.

“Our studio faced difficult comparisons in the third quarter, but Warner Brothers Television is having a terrific broadcast season,” said Jeffrey L. Bewkes, chief executive of Time Warner. He added: “Over all, I'm very confident about how we're positioned heading into the next year and beyond.”

News Corporation\'s Earnings Surpass Expectations

Josh Reynolds/Associated Press Rupert Murdoch did not participate
in an investors' call.

The News Corporation, benefiting from one-time gains and the continued strength of cable channels like Fox News, on Tuesday posted earnings that generally exceeded analysts' expectations.

The company, controlled by Rupert Murdoch, said that net income in the third quarter of the year - its fiscal first quarter - jumped to $2.23 billion, or 94 cents a share, from $738 million, or 28 cents a share, in the same quarter last year.

The uptick was mostly a result of the sale of the company's stake in the technology firm NDS Group to Cisco Systems. Excluding that and other one-time factors from this year and last year, the News Corporation earned 43 cents a share in the quarter, up from 32 cents a share last year.

The company's revenue rose to $8.14 billion, up from $7.96 billion.

Mr. Murdoch said in a statement that the company was led by “double-digit growth in our channels business and the global success of our film and television content.”

The company's cable channels segment made almost a billion dollars in profit in the quarter, because of an 8 percent jump in advertising revenue and a 16 percent increase in revenue from subscriber fees. Its film division made $400 million in profit and its television division (the Fox network and local stations) made $156 million.

The cable division benefited from what the company called “a more than doubling of retransmission consent revenues,” the fees paid by cable and satellite companies to show local stations.

Publishing, on the other hand, showed a profit of just $57 million, down from $110 million in the same quarter last year. The company cited lower advertising revenue across all segments, led by declines in the publishing business in both Australia and the United States.

Ongoing charges relating to the phone hacking investigation in Britain cost the company $67 million in the quarter.

Mr. Murdoch did not participate in the company's conference call with investors on Tuesday afternoon. His chief operating officer, Chase Carey, avoided talking about possible acquisitions, two weeks after news reports that the company was interested in buying The Los Angeles Times from the Tribune Company. “Obviously we should look at some things,” Mr. Carey said, sticking with generalities.

News Corporation is preparing to break into two companies, one for higher-performing television and film assets like Fox and the cable division, and another for publishing assets like The Wall Street Journal. Mr. Murdoch said in his statement that “w e have made considerable progress in this process and look forward to providing more details by the end of the year.”

Last month, at the annual shareholders' meeting, Mr. Murdoch faced challenges to the News Corporation's management structure, with some investors calling for changes on the board and the elimination of the dual stock structure that enables the Murdoch family to retain control of the company.