News Corp COO Chase Carey threw down the gauntlet to Idol‘s producers today, telling investors that the show’s ratings are “disappointing” and that the franchise “can and should provide fresh energy.” The show is “a glass half full,” he told the Deutsche Bank Media & Telecom Conference. It’s still big, but grappling with new competitors including NBC’s The Voice and Fox’s The X Factor. But Carey doesn’t seem to think that lets Idol off the hook: News Corp has factored into its financial guidance the fact that “the ratings aren’t where we hoped for them to be.”

For the most part, Carey was characteristically upbeat about News Corp’s prospects, especially in cable networks. He likes the fact that about half of Fox News’ pay TV distribution carriage contracts are due to be renewed in 2012 — an election year. Although he wouldn’t say how much additional revenue he expects to see in those deals, ”there’s a lot of growth left,” he says. He adds that “one of the great things” about the unit is that its costs are “pretty manageable….As we continue to drive popularity, a network like that benefits on all fronts.” He also has high expectations for FX. Although it is a close competitor to NBCUniversal’s USA Network, FX “probably makes half of what (USA) does.” Carey also sees new opportunities for News Corp’s regional sports networks. Time Warner Cable’s recent decision to end its contract impasse with Madison Square Garden — which owns and broadcasts the New York Knicks — “speaks to the value of sports franchises,” he says. Although the high cost of sports rights make them a “double-edged sword,” News Corp’s sports channel in Los Angeles has renewed its deals with the Los Angeles Angels of Anaheim and with the Los Angeles Clippers. As for the Dodgers, ”we’ll see if there’s something that makes sense.”

On other fronts, Carey says that News Corp isn’t looking to unload its newspapers — which many investors see as a growth-challenged distraction. “Our focus is on managing these businesses and improving profitability,” he says. Carey was more enthusiastic about Hulu. ”It’s a truly unique franchise that millions of people go to….A lot of people would chop off their arm to have that kind of place in the digital world.” He says that it must “continue to build on that leadership position.” And Carey hinted that News Corp might increase its effort to repurchase its shares. “We have a woefully undervalued stock,” he said. As the company approaches the end of its fiscal year in June “if things look like they do today, another buyback makes sense.”