Deutsche Bank said in a research note that News Corp could post net losses of between A$5bn and A$9bn, after Gemstar warned that it may have to write off US$5bn (£3.5bn) in the first quarter of 2002 as a result its merger with News Corp division TV Guide.
However, the bank said that despite the write-off, News Corp was well placed to report strong earnings growth in the next two to three years, as the US advertising market looks set to improve this year and the Fox movie 'Ice Age' performs well at the box office.
The possible closure of ITV Digital in the UK would benefit News Corp-owned BSkyB, while in Asia, News Corp's Star pay-TV business is progressing well.
It was not all good news, however, as Deutsche Bank said the stock's performance could be hampered by several factors such as weak US TV ratings.
Another factor that might affect News Corp's performance, according to Deutsche Bank, is its failure to complete the sale of its loss-making Italian pay-TV venture Stream to Vivendi, which is being held up by competition regulators.
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