April 19, 2024

Media Decoder Blog: Cable TV Revenue Help Spur Time Warner Profit

2:14 p.m. | Updated The cable television business helped propel Time Warner to a 51-percent increase in net income and offset weakness in magazine publishing and movies in the three months that ended Dec. 31.

The media company said Wednesday that an increase in advertising revenue and subscription fees paid by cable and satellite companies to carry channels like TNT and TBS helped lift net income in the fourth quarter to $1.17 billion, or $1.21 a share, up from $773 million, or 76 cents a share, in the same three-month period last year. Revenues remained flat at $8.2 billion.

The results underscore the widening gap between the fast-growing cable television business and the more challenged magazine publishing industry and, to a lesser degree, the movie businesses.

Time Warner also said on Wednesday that its board had approved $4 billion in stock buybacks and that it would raise its quarterly dividend by 11 percent to 28.75 cents per share.

Jeffrey L. Bewkes, Time Warner’s chairman and chief executive, called the cable television business the “core of the company.” He praised the premium cable channel HBO, pointing to the interest fueled by returning series like “Game of Thrones” and “True Blood” and new original series like “Girls.” HBO added domestic subscribers in the quarter, the company reported.

At the same time, Time Inc., the nation’s largest magazine publisher, readied for layoffs of 6 percent of its global work force, cutbacks that it announced last week. Time Warner estimated the reductions would cost an estimated $60 million in restructuring charges, which will be reported in the first quarter of 2013.

Revenue at the company’s television networks, which include TNT, TBS, and CNN, rose 5 percent to $3.67 billion in the quarter. Subscription and advertising revenues at Time Warner’s suite of cable channels grew 7 percent and 3 percent, respectively, in the quarter, compared with last year. An increase in the number of National Basketball Association games on Turner channels, as well as coverage of the presidential election on CNN, led to higher ratings.

Mr. Bewkes said that, even with the boon from election coverage, CNN’s ratings disappointed. He praised the recent choice of Jeff Zucker, a former chief executive of NBC Universal, to lead CNN. “I’m optimistic that with the new leadership we’ve announced, CNN will once again fulfill the promise of its iconic brand,” he said on a conference call with analysts.

Revenue at the Warner Brothers studio fell 4 percent in the quarter to $3.7 billion, due largely to a tough comparison with 2011, which included the home entertainment release of the popular “Harry Potter and the Deathly Hallows: Part 2.” The performance of “Argo” and “The Hobbit: An Unexpected Journey” lifted Warner Brothers’ performance in the quarter and contributed to a 29 percent increase in operating income to $522 million.

Last week, Time Warner announced that Kevin Tsujihara, currently the head of the studio’s home entertainment division, would succeed Barry M. Meyer as chief executive of Warner Brothers. “I chose him because he’s got the greatest breadth of experience across Warner’s businesses,” Mr. Bewkes said on Wednesday.

Time Inc., the publisher of People, Sports Illustrated and InStyle, represents a small part of Time Warner’s overall business, but nevertheless continued to weigh on the company’s overall results. Revenues at Time Inc. declined 7 percent to $967 million, while advertising revenues fell 4 percent, or $24 million. Subscription revenues remained flat.

For the full fiscal year, which also ended Dec. 31, Time Warner reported net income of $3 billion, or $3.09 per share, compared with $2.9 billion, or $2.71 per share in 2011. In the full fiscal year, revenues decreased 1 percent to $28.7 billion.

Article source: http://mediadecoder.blogs.nytimes.com/2013/02/06/cable-tv-revenues-helps-spur-time-warner-profit/?partner=rss&emc=rss

The Media Equation: An Outsider Making Waves in Hollywood

On an unusually clear day in West Hollywood last week, Janice Min took a seat at the Soho House, the full expanse of the Hollywood Hills serving as a backdrop for lunch. It was odd to see Ms. Min, a fixture of Manhattan magazine publishing, here in a city that has been accused of reading little more than the large type plastered on vanity billboards lining Sunset Boulevard, which lies below us.

Ms. Min, who took over US Weekly from Bonnie Fuller in 2003, brought a strong sense of packaging along with a deft high-low touch, and she doubled its circulation by the time she left in 2009. Then, improbably, she moved to Los Angeles 10 months ago to remake The Hollywood Reporter, a down-on-its-luck daily trade magazine that was losing a horse-and-buggy race with Variety. The competition seemed a little beside the point at a time when Web personalities like Nikki Finke were terrorizing and fascinating the industry.

“I don’t think one person told me it was a good idea. Not one,” Ms. Min said about her decision to become editorial director of The Hollywood Reporter.

Except it seems to be working. Ms. Min, a demure Columbia graduate who knows her way around a Diane Von Furstenberg dress, took the also-ran daily built to break news and turned it into a large-format glossy weekly. The breaking news was pushed to a redesigned Web site. In print, instead of quick blurbs about comings and goings, she published 3,000-word profiles of and about Hollywood, plus plenty of juicy photo galleries and lighter items.

From April 2010 to this April, traffic to hollywoodreporter.com rose to 4.5 million unique visitors a month, an increase of 800 percent, according to comScore. Circulation for the weekly has inched up over 70,000, which seems small, but it reaches a pretty rarefied demographic. Richard Beckman, who runs Prometheus Global Media, the magazine’s parent company, says ad revenue for the weekly is up 50 percent over what the daily version brought in. The cover of the weekly, which began publishing last November, has become prized real estate, a place where talent and executives love to see their products and mugs.

It’s all very lovely to behold, but of course, that’s no guarantee that it will be a great business as well. It will be several years before we know whether the big investment in the good-looking magazine will yield pretty numbers as well.

“They managed to change the subject by going weekly,” said Terry Press, a longtime entertainment marketing consultant and a fan of print. “The large photos, lush paper stock and great design are a kind of narcotic here.”

All that remains of the legacy product is most of the staff and that iconic name.

“The trades were making uninteresting products about a very interesting business,” Mr. Beckman said. “When we bought it, people said, ‘Forget it, it’s dead.’ And then when we announced the plan to put the news on the Web, transform a daily into a weekly, we were ruining a venerable institution that was 80 years old. And now some of the biggest skeptics are telling us it is just what the industry needs.”

Ms. Min, as it turned out, was the necessary interloper.

“When you are on the inside, you don’t realize bad things are happening as they’re happening,” she said. “I really don’t think an insider could have come in from here and remade The Hollywood Reporter. I think you had to have been an outsider.”

She’d like it to stay that way. Ms. Min, who acknowledges not missing all that much about New York, except her friends, does not want to go completely native.

“I always worried in the back of my head, ‘Am I going to become an awful person, one of those people who is screaming at someone to go get my dry cleaning?,’ ” she said. “I like the people here, but I don’t have a deep investment in becoming one of them.”

Many magazine editors are known for cutting a wide swath in their own offices and beyond. Ms. Min has never been big on acting big. For much of an editorial planning meeting last Tuesday for The Hollywood Reporter’s weekly magazine, Ms. Min was content to let Owen Phillips, the executive editor, run through the schedule.

But somewhere in the middle of the meeting, a proposed picture for the back page, a strong, iconic image drawn from the trade magazine’s 80-year history, is slid down the table for inspection. After being handed a picture of a back-in-the-day Stan Lee, the comics genius, posing with some badly dressed superheroes, Ms. Min cocked her head to the side as she took a skeptical look. Bill Higgins, a reporter who was hired away from Variety, said, “I know that look, I’ll keep looking.”

Not many editors seem as content to just let people do their jobs.

E-mail: carr@nytimes.com;
Twitter.com/carr2n

Article source: http://feeds.nytimes.com/click.phdo?i=be17a796a9c5c386374aff04b126daf2