Media Companies

The media companies covered in this section are:

• Time Warner
• The Walt Disney Company
• Viacom
• Vivendi Universal

Time Warner

Time Warner is the world leader in the media industry, with operations spanning the entire globe. It was created as the result of a merger between America Online and Time Warner in January, 2001, starting off as AOL Time Warner and then changing its name to Time Warner in October 2003. Most of its revenues originate in the US media market.

For calendar 2003, Time Warner reported a 6.03 percent growth in its revenue due to higher subscription and content revenues. Increase in content revenues came from worldwide box office success of popular movie series ‘The Matrix’and ‘The Lord of the Rings,’ better DVD revenues worldwide and higher television network license fees. Growth in subscription revenues was driven by increases in the cable segment, which resulted from continued deployment of new services and higher rates. Subscription income of AOL got a fillip on account of AOL Europe.

The Walt Disney Company

The Walt Disney Company is the second largest of the global media companies.  Founded in 1923, Walt Disney today is a diversified entertainment giant with four major businesses. Each of these businesses in turn comprises a host of integrated, well-connected businesses that operate together to maximize market share and growth. The US and Canada combined account for 81 percent of its revenue.

The company’s revenue grew by 8.96 percent and operating income by 10.62 percent due to the surge in revenue from Media Networks and Studio Entertainment. These divisions did well due to higher advertising and broadcasting sales in addition to better worldwide entertainment revenue.

Viacom

Viacom is a diversified worldwide entertainment company with operations in cable networks, and the radio and television industry. It acquired Paramount Communications and Blockbuster in 1993 and bought TV network CBS in 2000. This year, however, Viacom and Blockbuster have split. In 2003, Viacom acquired the remaining 50 percent interest in Comedy Central. The US accounts for 81 percent of its revenue.

According to media statistics Viacom’s revenue increased by 8.04 percent in 2003, due to strong advertising profits, retail and rental sales, fees for cable networks and an increase in entertainment sales, driven primarily by DVD sales.

Vivendi Universal

Vivendi Universal is one of the major players in media and telecommunications. It was previously a water utility firm, which was catapulted by former CEO Jeane Marie Messier to a dominating position in the media and entertainment business. However, the burden of burgeoning debt forced Vivendi to spin off various divisions and sell businesses such as Internet gateway Vizzavi. France accounts for 46 percent of its sales.

A buying spree in the 1990s by former boss Jean-Marie Messier has resulted in a massive pile up of debts. Now Vivendi is attempting to reduce the debt to manageable levels. It posted lower losses in 2003 but revenues declined due to a lower contribution from Universal Music, VU Games and Canal+ Group. The decline would have been steeper if not for higher revenue from SFR Cegetel Group, Maroc Telecom and VUE.

Read the full Article with a single purchase – CLICK HERE