Time to talk Time Warner

August 6, 2008


Time Warner’s earnings may be better-than-expected, but the most arresting news out of its quarterly report isn’t really about the media company’s profit, revenue or forecasts. It’s about strategy.

It’s always interesting to find out what direction Time Warner plans to take. What’s it selling? What’s it spinning off? What could it buy? Will it get rid of AOL? Could it acquire NBC Universal?

Here’s the latest news: Time Warner Chief Jeffrey Bewkes says the company would split AOL’s dial-up Internet and advertising business. This plan, along with getting rid of its cable services business, basically positions Time Warner as a content company.

Here’s what Bewkes said in the press release:

We’ve also made significant progress in our top structural initiatives. During the quarter, we agreed to the terms of our planned separation from Time Warner Cable. In addition, we’ve made the key decisions that will enable us to run AOL’s access and audience businesses separately beginning in 2009. As we continue to reshape Time Warner, we’ll increasingly focus on our goal to create and manage high-quality branded content, across multiple platforms around the world, at the highest returns possible for our stockholders.

Okay, but this leaves a lot of questions to be answered. Sources have said Time Warner is still talking about deals to merge or sell off its online advertising and Internet business. Does this mean a deal with Microsoft? Or Yahoo? And if it sees itself as a content company, does this mean it could be looking to acquire a TV network? Or more cable channels? Does it make a deal with NBC Universal more likely? (We should note that NBC Universal and parent GE have repeatedly said the media concern is not up for sale).

It’s time to speculate…

Keep an eye on:

  • Comcast is buying email fashion and culture newsletter Daily Candy for $125 million, the Wall Street Journal reports, citing people familiar with the matter (WSJ.com)
  • Mel Karmazin talks to the New York Times about the merger of Sirius Satellite Radio and XM Radio, and says the movie he is most proud of making in his time as a media mogul is “Jackass.” ”It cost me $6 million and made $100 million,” he says (NY Times)
  • Mario Gabelli has filed to raise $200 million and will use the proceeds to buy a media or telecom company (NY Post)

(Photo: Reuters)

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