News Corp is to close its US-based online division News Digital Media.
But the Mr Rupert Murdoch-controlled global media heavyweight said the decision would not affect the operation of its Australian-based internet operation, News Interactive.
News Corp said in a statement that it would transfer the production of its three major US websites back to the networks they are associated with - Fox Broadcasting Company, Fox Sports Television Group and Fox News Channel.
This would result in job losses for about half of the 450 people employed at News Digital Media.
News Digital Media was formed in 1997 to provide fresh editorial content for the company's much-vaunted online venture through websites FoxNews.com , FoxSports.com, and Fox.com.
Mr James Murdoch, the 27-year-old son of News Corp chairman Rupert Murdoch headed the division until 1999. He is now the boss at Star TV, the company's Asian satellite television operation.
"We strongly believe that combining the news, sports and general entertainment productions and news gathering operations will greatly reduce costs while ultimately providing an enhanced experience for our audience . . ." News Digital Media president Mr Jon Richmond said.
AFP