Time Warner: What a Mess

Time Warner (TWX) seems to be unraveling. Profits this quarter are down 36%. It is spinning off one of its most solid businesses, Time Warner Cable (TWC) -- which grew 8% in the first quarter. AOL remains an internet laggard -- its sales of display ads fell 18% in the quarter.

Bets are that cable is only the first to go. Time Warner will have to split itself into more pieces -- its current sprawling structure clearly isn't working. Funny that many expect the AOL + Time + Warner combination to eventually revert to a rough equivalent of separate AOL, Time and Warner companies. Talk about a failed empire.

Oh, speaking of empires that don't work, Barry Diller's IAC saw its profits fall 13% in the first quarter. This is why IAC is splitting into pieces.

Comments

[OJO Zafado:]

So then the debt of the TWC like GJG and PYI are to be bought? Still well below par. Yields are around 7.5%? This guy gets paid for writing such an interesting teaser line to his subject and then posting such an abbreviated blog? The cable TV companies are amoung the most hated by consumers. Longer term they appear to be facing alot more competition from each other and the other media providers such as phone lines and satellite. If satellite were to improve their access they could do alot more business it would seem. As things are now you are supposed to have your neighbor cut down his 70 year old oak tree so you can get a clear signal? I am paying less now for medium speed Internet access today than I paid for dial up 5 years ago. This has happened in every part of communications industry since the break up of ATT. Eventually there will be a resource that understands that the consumer really does want less for less. There reallly are people out there that think Game Stop is a stock, not a place you would ever shop. Some of us never rented movies because you had to rewind them. Now you can rent a DVD but there are still many of us that see that term and think of NASCAR racing not a colorized edition of "Casablanca". I know most of us will desperately miss a second Chinese and a third Spanish language network. Some seniors might even opt to dump the all Myely Cyrus all the time channnels. How can only one God Channel possibly fulfill the desperate needs of a Godless society. "And the people bowed and prayed...." Nature abhors a vacuum.

2008 May 06 05:32 AM

[OJO Zafado:]

SO THE GJG TOOK A BIG LEAP TODAY. I AM NOT SURE WHY? Anyone with any thoughts. This blog is really not getting much action. As my last post intimated mot a very exciting story. not very exciting stocks although I think the TWC is a good bet longer term.

2008 May 07 12:11 PM