Summit Notebook

from MediaFile:

Soccer clubs and mortgages: How a media mogul spends $10 million

Unlike many of us, media executives know what it’s like to play around with large wads of cash. So it seemed natural to ask them about what kind of investment opportunities they’re seeing when they gathered in New York this week for the Reuters Global Media Summit.

We gave each media honcho $10 million in hypothetical cash and told them to put the money to work without buying stock in their own companies.

Some executives plowed the money into broad sectors and regions, like emerging markets, while others zeroed in on specific stocks, like Electronic Arts’ CEO John Riccitiello’s penchant for software maker Adobe.

Zynga CEO Mark Pincus said he already owns shares of privately-held Facebook, the Internet social network on which many of Zynga’s video games are designed to be played on, and that he’d buy more on the secondary markets (OK, so he creatively sidestepped the rule against investing in his own company).

And some media moguls seemed to have investment strategies driven by goals other than maximizing returns:

"I would put it in US-based international equities. I mean, if you said….If you forced me to invest a dollar."

(Reuters: You can put it in your pillow if you want.) That’s what I’ve been doing. Unfortunately, the pillow was unsleepable

A Barry Diller sampler from the Reuters Global Media Summit

Interviewing IAC chief and media mogul Barry Diller nearly always means that you’ll get more quotable quotes than you can stuff into one article. He didn’t disappoint at this year’s Reuters Global Media Summit on Wednesday. Here are thoughts from Diller on a range of subjects from mergers and acquisitions and Comcast to AOL, MGM and marriage.

Q: What are you going to do with the cash on the balance sheet? What’s the focus? Are you still being cautious?

A: “I’d say we still are. It’s definitely a looming problem. The only thing worse than spending cash stupidly is essentially not to put it down at all, not to do anything.”

Q: What would be the right opportunity to buy something?

A: “There’s no road map here. Anything of size, let’s call it $1 billion plus, is known. … Of the potential availables, nothing seems smart right now.”

Q: What about AOL?

A: “Steve Case came to me … and offered us AOL. In 1992 or 1993, Paul Allen was selling his stake, which was about 25 percent of the company. We were very fresh into buying QVC and overly cautious and missed the opportunity; opportunity since then I’m kind of glad I missed.”

Daily Beast staff ‘happy as clams,’ says Barry Diller

The journalists and staff who work at The Daily Beast don’t look at life like you other sad-sack scribes out there who are watching your job market wash out to sea with the ebb tide. In fact, they are happy in a particularly mollusk-like way.

“They’re as happy as clams,” said Barry Diller, chief executive of IAC/InterActiveCorp, which is financing the online news outlet with its editor, Tina Brown. “They wake up every morning filled with possibility.”

That’s because they are not working at sinking-ship news outlets like most of the rest of their colleagues in mainstream U.S. journalism.

Hear Diller on this, speaking at the Reuters Global Media Summit:

“Look at what’s going on in publishing. The talk about the destruction that’s taking place there. It’s the perfect time to start something that’s an original product. The Daily Beast is a daily newspaper or magazine. It’s primarily original and is there every day. It’s got real staff, making real money, paying a lot of them — journalists — to make things for us, make stories… They’re covering books, art, the daily features and national and international stories. And it’s incredibly ambitious. It’s gotten a real audience. It is absolutely an original product.”

Who wouldn’t like that? Even better, Diller seems OK with the whole “it doesn’t make money” aspect of the Beast. He declined to say what the targets are, like, when he expects it to make a profit, when he expects it to make some revenue and how it will do those things. “We’re going to know at a rational point,” he said.

The best part is, I don’t even end this blog with: “And then I woke up.” Now the question is whether we can find some more sugar-moguls to sweeten our journalistic career paths.

Diller to profitable companies: Lay off the layoffs

IAC Chief Executive Barry Diller took several groups to task at the Reuters Media Summit, but he reserved special disgust for CEOs at profitable companies who add to the country’s rising unemployment rate.

Also targeted by the former Hollywood executive were “incredibly, shockingly stupid” Big 3 auto executives, the Internet’s strange and growing dictionary, and Hollywood’s lack of creativity.

Diller said companies had a higher obligation, especially in tough times like these:

“The idea of a company that’s earning money, not losing money, that’s not, let’s say ‘industrially endangered,’ to have just cutbacks so they can earn another $12 million or $20 million or $40 million in a year where no one’s counting is really a horrible act when you think about it on every level. First of all, it’s certainly not necessary. It’s doing it at the worst time. It’s throwing people out to a larger, what is inevitably a larger unemployment heap for frankly no good reason.”

A few seconds later, he added:

“It’s not that you don’t want to earn as much money as you can — it is your obligation, of course — but companies have obligations beyond that and they certainly have obligations beyond that at certain times, in the times in which they operate. And they also certainly ought to know that meeting and beating expectations is probably yesterday’s game and it will be increasingly so, which would be by the way very healthy for companies. Running a company that meets and beats expectations, and that runs their company accordingly, are companies that I would question why anyone would invest in.”

Diller was equally confounded by the top three U.S. auto executives, who recently were criticized for separately flying corporate jets to Washington before hearings to request a $25 billion taxpayer bailout.