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WIKI ANALYSIS
Time Warner Inc. (NYSE: TWX) (formerly AOL Time Warner) is one of the world’s largest media conglomerates. It operates Time Warner Cable and TV programming and magazines such as Time Inc., Warner Brothers, and HBO. Its publishing business segments have been hard hit with falling advertising revenue. In December 2009, AOL was spun-off from Time Warner, making it an independent company again for the first time since the beginning of the 2000's.[1] Time Warner Cable (TWC) was spun off from the company in March 2009.[2]
Although its filmed entertainment business produces successful block buster movies like “The Dark Knight” and franchises like “Harry Potter” and “Ocean’s”, a continuing trend of falling movie theater attendance is troublesome for the company; this decrease can be attributed to high priced movie tickets along with poor economic conditions, and as HDTV’s become more inexpensive and home theater systems more affordable, consumers will switch to the latter option.
Company Overview
Business Segments
Time Warner operates three business segments: Filmed Entertainment, Networks, and Publishing
Filmed Entertainment (40% of revenue)[3]
Time Warner, under Warner Bros. Entertainment Group and New Line Cinema Corporation, produces and distributes theatrical motion pictures, television shows, and license rights to the its films and television shows.
Networks (46% of revenue)[3]
This business segment offers pay television programming services such as HBO and Cinemax and operates domestic and international networks. Revenue consists of subscriber fees paid by cable system operators and satellite distribution services, and of advertisings. Time Warner is planning to expand into the online TV market as well, showing some of its popular shows to paid subscribers, following in the suit of Comcast.[4]
Magazine Publishing (14% of revenue)[3]
Time Inc., a subsidiary of Time Warner, is the largest magazine publisher in the U.S. publishing over 120 magazines worldwide.[5] Aside from publishing magazines such as People, Sports Illustrated, Time, among others, it operates over 40 websites worldwide. In September 2009, it was announced that Time Warner plans to eventually sell the Time Inc. magazine unit and buy holdings in its core entertainment category.[6]
Competition
As a conglomerate with a hand in five different aspects of media, Time Warner faces competition from a lot of different angles. AOL faces a lot of competition for Internet revenue, as shown in an above table, Time Warner Cable faces competition from a number of companies as well, shown on the Time Warner Cable page. While certain sectors struggle for market share, Time Warner subsidiaries are firmly entrenched as the leader in the film industry.
References
- ↑ Reuters: Time Warner Inc. Completes Spin-off of AOL Inc.
- ↑ TWX 2010 10-K
- ↑ 3.0 3.1 3.2 TWX 2010 10-K, Note 15
- ↑ Comcast to debut cable shows online by year's end
- ↑ Time Warner Inc. 2007 10-K, Pg 17
- ↑ Reuters: Crawford says Time Warner will sell magazine unit
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