time warner: what is the objective?

September 3, 2006

in today’s nytimes there is an article in the business section about the fate of time warner. it really got me thinking. without sounding ignorant here…i mean i know we live in a capitalist society and everything must have market value…but what is the goal of the media companies? these conglomerates are not interested at all in the quality of what they produce. not once in the article did it mention the editorial aspect of the company losing money and having to cut corners. instead it only discussed the ceo’s and the advantages or disadvantages of breaking the company up into smaller pieces. yes, it was in the business section and was primarily addressing related economic issues. but one would hope the discussion of the quality of the product would go hand in hand with the discussion of the company’s future.

here’s the link: http://www.nytimes.com/2006/09/03/business/yourmoney/03frenzy.html?ex=1314936000&en=2cb8dbb14abc9699&ei=5088&partner=rssnyt&emc=rss

sorry i don’t know how to permalink (right term?) this…

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3 Responses to “time warner: what is the objective?”

  1. That’s a good point but in the business section they’re really only concerned with the business issues. If it were an article about layoffs at newspapers, then it probably would have been discussed.

    For better or for worse, the stock market is driven not by a company making many (which Time Warner clearly does quite well) but on growth potential, meaning that a stocks value is driven by how much their profits are going up and the present means less than the perception of the future.

    I think there’s a great comparison to be made here between this article about Time Warner and last weeks article about Knight Ridder (found here: http://www.nytimes.com/2006/08/27/business/yourmoney/27knight.html?_r=3 ). Both are/were under attack by outside players seeking “shareholder value.” But Knight Ridder had a CEO that capitulated to a man who made a very bad business decision. Parsons is fighting to keep Time Warner together and it will be interesting to see how he does in this.

    Personally, I belive that ever since the merger with AOL, Time Warner has been treating it like an albatross and until they start figuring out how to use it rather than begruding its existence they’re going to have issues. It would seem to make sense to transfer some of their money losing magazines like Teen People to the net and AOL would be a great vehicle for this.

  2. You make a great point Ben. They merged with AOL, so they need to find a way to work with it and make it useful, rather than treating it like anathema. The problem is, AOL’s been gushing money for so long, it’d take someone with real brains to figure out how to make it profitable again. And then, you’d need the high ups at Time Warner to go along with the massive restructuring of AOL that’d be needed. We’ll see, but I’m not holding my breath.

  3. […] In her blog from September 3, Georia Kral raised the issue of content at Time Warner’s media operations, which received nary a mention in the Sunday New York Time’s article on the companies lagging stock price. Well, ask and you shall receive. A story in today’s business section addressed just that, at least at Time Warner’s flagship Time Magazine and its main competitor, Newsweek. Mr. Stengel’s plan is to fill the pages of Time with more essays and news analysis, give the magazine a sharper point of view and draw more brand-name journalists into the fold. If this sounds familiar, it may be that Mr. Stengel wants Time to be little more like its chief rival, Newsweek, which already has a star roster of essayists like George Will, Anna Quindlen and Fareed Zakaria. […]

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