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Company Profile For Time Warner Inc (TWX)
Company Profile For Time Warner Inc (TWX)
Details
Employees: 86400
Issue Type: CS
Last Audit: UQ
Industry Classifications
Share Statistics
39,794,787 as of
Short Interest:
(2009/01/27)
Non-Corp. Insider
0.1% as of (2009/01)
Holdings:
Bought Prev 3 Mo: 530,925 Sold Prev 3 Mo: 530,925
Time Warner
Time Warner Inc.
Jeffrey L. Bewkes
Key people
(Chairman) & (CEO)
Operating
▲ US$ 8.949 Billion (2008)
income
Time Warner Inc. (NYSE: TWX) is the world's second largest media and entertainment
conglomerates by market capitalization (behind News Corporation), headquartered in the Time
Warner Center in New York City. (TimeWarner.com Fact Sheet Page) Formerly three separate
companies (and owns the assets of a fourth, Turner Broadcasting System, Inc., acquired by a
pre-AOL merger TW in 1996): Warner Communications, Inc. and Time Inc. before the Time-
Warner merger in 1990 and America Online, Inc. before its purchase of Time Warner in 2001
has created the current Time Warner , with major operations in film, television, publishing,
Internet service and telecommunications. Among its subsidiaries are AOL, New Line Cinema,
Time Inc., Time Warner Cable, HBO, Turner Broadcasting System, The CW Television
Network, TheWB.com, UBU Productions, Warner Bros. Entertainment, Kids' WB, The
CW4Kids, Cartoon Network, CNN, DC Comics, and Mohawk Productions.
Contents
• 1970s
• 1980s
• 1990s
• 2000s
• Transactions made since the AOL-Time Warner merger
• The CW Television Network
• Time Inc.
• Financials
• Commercial properties
• Board of directors
• Senior Executives
• Time Warner Inc.
• Subsidiaries
• Competition
• Past names
• References
1970s
In 1972, Kinney National Company spun off its non-entertainment assets due to a financial
scandal over its parking operations and renamed itself Warner Communications Inc.
It was the parent company for Warner Bros. Pictures and Warner Music Group during the 1970s
and 1980s. It also owned DC Comics and Mad, as well as a majority stake in Garden State
National Bank (an investment it was ultimately required to sell pursuant to requirements under
the Bank Holding Company Act). Warner's initial divestiture efforts led by Garden State CEO
Charles A. Agemian were blocked by Garden State board member William A. Conway in 1978;
a revised transaction was later completed in 1980.
In 1976, Nolan Bushnell sold his Atari company to Warner Communications for an estimated
$28–32 million. Warner made considerable profits (and later losses) with Atari, which it owned
from 1976 to 1984. While part of Warner, Atari achieved its greatest success, selling millions of
Atari 2600s and computers. At its peak, Atari accounted for a third of Warner's annual income
and was the fastest-growing company in the history of the United States at the time.
In 1975, Warner expanded under the guidance of CEO Steve Ross and formed a joint venture
with American Express, named Warner-Amex Satellite Entertainment, which held cable
channels including MTV (launched 1981), Nickelodeon (launched 1979) and The Movie
Channel. Warner bought out American Express's half in 1984, and sold the venture a year later to
Viacom, which renamed it MTV Networks.
1980s
In 1980, Warner purchased The Franklin Mint for about $225 million. The combination was
short lived: Warner sold The Franklin Mint in 1985 to American Protection Industries Inc. (API)
for $167.5 million. However, Warner retained Franklin Mint’s Eastern Mountain Sports as well
as The Franklin Mint Center, which it leased back to API.[3]
In February 1983, Warner expanded their interests to baseball. Under the direction of Ceasar P.
Kimmel, executive vice president, bought 48 percent of the Pittsburgh Pirates for $10 million.
The company then put up its share for sale in November 1984 following losses of $6 million.
The team's elderly majority owner, John W. Galbreath, soon followed suit after learning of
Warner's actions.[4]
In 1984, due to the video game crash of 1983, Warner sold the consumer division of Atari to
Jack Tramiel. It kept the arcade division and renamed it Atari Games. They sold Atari Games to
Namco in 1985, and repurchased it in 1994, renaming it Time-Warner Interactive, until it was
sold to Midway Games in 1996. In a long-expected deal, Warner Communications announced on
May 11, 1988 they were acquiring Lorimar-Telepictures; the acquisition was finalized on
January 12, 1989. The merger of Time Inc. and Warner Communications was announced on
March 4, 1989. During the summer of that same year, Paramount Communications launched a
$12.2 billion hostile bid to acquire Time, Inc. in an attempt to end a stock-swap merger deal
between Time and Warner Communications. This caused Time to raise its bid for Warner to
$14.9 Billion in cash and stock. Paramount responded by filing a lawsuit in a Delaware court to
block the Time/Warner merger. The court ruled twice in favor of Time, forcing Paramount to
drop both the Time acquisition and the lawsuit, and allowing the formation of Time Warner
which was completed on January 10, 1990.
1990s
In early 1990,own all the gurls and the combined companies were named Time Warner. This
company subsequently acquired Ted Turner's Turner Broadcasting System in October 1996. Not
only did this result in the company (in a way) re-entering the basic cable television industry (in
regards to nationally available channels), but Warner Bros. also regained the rights to their pre-
1950[5][6] film library, which by then had been owned by Turner (the films are still technically
held by Turner, but WB is responsible for sales and distribution).
Time Warner had also been owner of the Six Flags Theme Parks chain during the 1990s after
near bankruptcy. It sold all Six Flags parks and properties to Oklahoma based Premier Parks on
April 1, 1998.
2000s
In 2000, a new company called AOL Time Warner, with Steve Case as chairman, was created
when AOL purchased Time Warner for US$164bn.[7] The deal, announced on 10 January 2000[8]
and officially filed on 11 February 2000,[9] employed a merger structure in which each original
company merged into a newly created entity. The Federal Trade Commission cleared the deal on
December 14, 2000,[10] and gave final approval on January 11, 2001;[citation needed] the company
completed the merger later that day.[11] The deal was approved on the same day by the Federal
Communications Commission,[9] and had already been cleared the European Commission on 11
October 2000.[12] The shareholders of AOL owned 55% of the new company while Time Warner
shareholders owned only 45%,[8] meaning that the smaller AOL had in fact bought out the far
larger Time Warner.
After the merger, the profitability of the ISP division (America Online) decreased.[citation needed]
Meanwhile, the market valuation of similar independent internet companies drastically fell. As a
result, the value of the America Online division dropped significantly. This forced a goodwill
write-off, causing AOL Time Warner to report a loss of $99 billion in 2002 — at the time, the
largest loss ever reported by a company. In 2003, the company dropped the "AOL" from its
name, and removed Steve Case as executive chairman in favor of Richard Parsons, with AOL
remaining a part of the company. That same year, Time Warner spun off Time-Life's ownership
under the legal name Direct Holdings Americas, Inc. Case resigned from the Time Warner board
on October 31, 2005.[13]
In 2005, Time Warner was among 53 entities that contributed the maximum of $250,000 to the
second inauguration of President George W. Bush.[14][15][16] On December 27, 2007 newly
installed Time Warner CEO Jeffrey Bewkes discussed possible plans to spin-off Time Warner
Cable and sell-off AOL and Time Inc. This would leave a smaller company made up of Turner
Broadcasting, Warner Bros and HBO.[17] On February 28, 2008 co-chairmen and co-CEOs of
New Line Cinema Bob Shaye and Michael Lynne announced their resignations from the 40-
year-old movie studio in response to Jeffrey Bewkes's demand for cost-cutting measures at the
studio, which he intended to dissolve into Warner Bros.
The network is the result of a merger of The WB Television Network (a Time Warner holding)
and UPN (a CBS Corporation holding). CBS Corporation and Time Warner each own 50% of
the network. Tribune Broadcasting (previously owned a 25% stake on The WB) and CBS
Corporation contributed its stations as new network affiliates.
Time Inc.
The Time Inc. division publishes approximately 150 titles worldwide. It is the leading magazine
publisher in the U.S. and UK, and is understood to be profitable at US$5 billion in annual
revenues.[19] As of January 2007, the unit is experiencing downsizing.[20] In January 2007, the
Bonnier Magazine Group agreed to acquire 18 magazines that Time Inc. was divesting. The
magazines in the package employed 550 people and included Field & Stream, Outdoor Life, Ski,
Yachting, and TransWorld Snowboarding, as well as 11 other titles that were part of Time Inc.'s
Time4Media Group. Also included were Parenting, and Baby Talk, which were part of the
Parenting Group.[21]
Financials
In 2004, Time Warner's market capitalization was $84 billion. When the AOL-Time Warner
merger was announced in January 2000, the combined market capitalization was $280 billion.
For fiscal year 2002 the company reported a $99 billion loss on its income statement [22] because
of $100 billion in non-recurring charges, almost all from a writedown of the goodwill (intangible
asset) from the merger in 2000. The value of the AOL portion of the company had dropped
sharply with the collapse of the Internet boom, in the early 2000s.
On 4 February 2009, Time Warner posted a $16.03 billion loss for the final quarter of 2008,
compared with a $1.03 billion profit for the same three months of 2007. [23]
Commercial properties
Time Warner Inc. owns several large properties in New York City; certain buildings in the
Rockefeller Center complex and adjacent office towers house its main offices; one of which
houses a CNN news studio. In late 2003, Time Warner finished construction of a new twin-tower
complex, designed to serve as additional office space, facing Columbus Circle on the
southwestern edge of Central Park. Originally called the AOL Time Warner Center, the 755-foot
(230 m), 55-floor mixed-use property was renamed Time Warner Center when the company
itself was renamed.
Board of directors
As of July 31, 2008.
• Herbert M. Allison Jr. - President and Chief Executive Officer, Fannie Mae
• Jim Barksdale - Chairman and President, Barksdale Management
• Jeffrey L. Bewkes - President and Chief Executive Officer, Time Warner Inc.
• Stephen F. Bollenbach - Hilton Hotels Corporation
• Frank J. Caufield - Co-Founder and Partner, Kleiner Perkins Caufield & Byers
• Robert C. Clark - Distinguished Service Professor, Harvard University
• Mathias Döpfner - CEO of Germany's Axel Springer AG
• Jessica P. Einhorn - Dean, Paul H. Nitze School of Advanced International Studies
(SAIS), Johns Hopkins University
• Reuben Mark - Chairman, Colgate-Palmolive Company
• Michael A. Miles - Special Limited Partner, Forstmann Little & Company
• Ken Novack - Senior Counsel, Mintz, Levin, Cohn, Ferris, Glovsky and Popeo, PC
• Richard D. Parsons - Chairman of the Board, Time Warner Inc.
• Deborah C. Wright - Chairman, President and Chief Executive Officer, Carver Bancorp,
Inc. and Carver Federal Savings Bank
Senior Executives
Time Warner Inc.
*Jeff Bewkes, Chairman,President and CEO of Time Warner Inc.
Subsidiaries
Competition
Time Warner faces industry competition from traditional media companies such as CBS
Corporation, The Walt Disney Company, News Corporation, and Viacom, as well as online
search portals such as Yahoo!, and Google for competition of viewer attention which translates
to ad sales. According to the recent 10Q, in order to remain competitive, Time Warner and AOL
must keep pace with rapid technological changes on the internet. Time Warner's business may be
severely impacted by the increasing "piracy" of feature films, television programming and other
content which decreases company revenues.[24]
AOL's subscriber base is declining, and declines are expected to continue, adversely affecting
subscription and advertising revenue. As more individuals are using non-PC devices to access
the Internet, AOL is under pressure to secure placement of its services and applications on
mobile devices.
Box office receipts and the growth rate of DVD sales have recently been declining, which
adversely affects Warner Brothers' growth prospects and revenues.[25]
Past names
• National Cleaning Company
• Kinney Parking Company
• Kinney National Company (1966-1972)
• Warner Communications (1972-1990)
• Time Warner (1990-2001, 2003-present)
• AOL Time Warner Inc. (2001-2003)