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Author Topic:   Time Warner
NEWSFLASH
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posted October 16, 2003 09:51 AM     Click Here to See the Profile for NEWSFLASH   Click Here to Email NEWSFLASH     Edit/Delete Message   Reply w/Quote
It's official - Time Warner.
http://www.timewarner.com/flash.adp

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NEWSFLASH
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posted October 16, 2003 10:57 AM     Click Here to See the Profile for NEWSFLASH   Click Here to Email NEWSFLASH     Edit/Delete Message   Reply w/Quote
AOL Time Warner became simply Time Warner again today (Thursday) and began trading once more on the New York Stock Exchange using the symbol TWX instead of AOL. Investors appeared to take little interest. At mid-morning shares in the entertainment company were unchanged from the previous day.

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posted November 18, 2003 05:23 PM     Click Here to See the Profile for NEWSFLASH   Click Here to Email NEWSFLASH     Edit/Delete Message   Reply w/Quote
Bronfman-Led Group to Seek Entire Time Warner Music Unit; Offer of $2.5 Billion May Be Below EMI Bid, but Faces Few Regulatory Obstacles

An investor group led by former Seagram Co. Chief Executive Edgar Bronfman Jr. is expected Tuesday to make an offer of about $2.5 billion for Time Warner Inc.'s entire music business, a bid that may be too rich for the media giant to ignore. The Bronfman group's offer is likely to be below the potential value of an alternative deal with EMI Group PLC. But EMI is bidding only for Time Warner's recorded-music operations, not for music publishing, which would be sold separately. Furthermore, the risks of getting regulatory approval for a deal with EMI are seen to have risen considerably since Sony Corp. and Bertelsmann AG agreed this month to merge their recorded-music businesses. As a result, while Time Warner's preference for the past few weeks had been the EMI deal, the Bronfman group's chances are thought to have significantly improved. The Bronfman offer, which may be pitched higher than $2.5 billion, would likely be approved by regulators quickly, as it wouldn't involve combining with an existing music company. An EMI deal, however, could take a year or more to be reviewed. Whether regulators in the U.S. and Europe would approve both an EMI-Warner combination and the Sony-Bertelsmann deal is seen as doubtful, as that would reduce the number of big music companies to three from five. Time Warner's board is expected Thursday to consider the alternative music deals, although a final agreement with either side isn't expected this week. So far the Bronfman group, which also includes Boston-based private equity firm Thomas H. Lee & Co. and billionaire investor Haim Saban, has done only limited due diligence on Warner Music. It is likely to want to do more detailed work before finalizing a deal. Success for Mr. Bronfman would re-establish him as a force in the music industry two years after he sold Seagram, then the parent of Universal Music Group, to Vivendi SA.

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indiedan
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posted November 19, 2003 08:54 AM     Click Here to See the Profile for indiedan   Click Here to Email indiedan     Edit/Delete Message   Reply w/Quote
WARNER PROSPECTS

EMI has been discussing a deal that would give Time Warner $1 billion of cash and a 20-25 percent stake in the enlarged music business, sources familiar with the situation said.

"Those discussions have progressed well and are at an advanced stage. We have made a firm proposal to Time Warner which, we believe, would create substantial value for the shareholders of both companies," EMI Chairman Eric Nicoli said.

"We would not have made a firm proposal if we didn't think we had good prospects," Nicoli added, in response to a question on the prospects for regulatory clearance after seeing two previous attempted mergers fail.

Time Warner is also considering an approach from a group including media moguls Haim Saban and Edgar Bronfman Jr for Warner Music's recorded music and music publishing business.

However, Nicoli said he was not aware of another firm proposal on the table. Time Warner's board is due to meet on Thursday to consider bids for Warner Music.

If Time Warner does not opt for the EMI bid, Nicoli reiterated that the company would still meet its objectives.

"We have delivered good results without a deal. We have made clear we can achieve our objectives with or without a deal," Nicoli told a conference call.

On the results, Nicoli said he would not be surprised if the consensus of analyst forecasts for the full-year drifted up a little after these results.

However, EMI's head of recorded music Alain Levy said he still expected music industry sales to fall five to eight percent in the fiscal year to end-March 2004.

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indiedan
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posted November 20, 2003 10:46 AM     Click Here to See the Profile for indiedan   Click Here to Email indiedan     Edit/Delete Message   Reply w/Quote
Although Jim Walton is nominally the new head of CNN, the person who is now actually calling the shots at the network is Ted Turner, according to CNN cofounder Reese Schonfeld. Schonfeld, writing on his website <www.meandted.com>, said that he had been informed of Turner's return to power at the cable news network by a former Time Warner exec, who told him that Time Warner Chairman Richard Parsons "defers to Ted on anything to do with CNN." Commented Schonfeld: "So, to all of you who have been suggesting TW bring back Ted Turner: Maybe you got your wish."

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posted November 23, 2003 06:56 PM     Click Here to See the Profile for NEWSFLASH   Click Here to Email NEWSFLASH     Edit/Delete Message   Reply w/Quote
Bronfman Group Set to Buy Warner Music

NEW YORK (Reuters) - Time Warner Inc. (TWX) plans to announce on Monday that it will sell its Warner Music business to a group of investors that includes former Seagram Chairman Edgar Bronfman Jr. for about $2.61 billion, people familiar with the situation said on Sunday.

Bronfman and private equity firm Thomas H. Lee will lead the acquisition. Billionaire Haim Saban, the former children's programming magnate, had pulled out of the group over the weekend, but rejoined later on Sunday night, these people said.

Investment firms Providence Equity Partners and Bain Capital also are part of the group, they added.

People close to the deal cautioned that final details were still being negotiated, which could change the composition of the buying group and/or possibly force the postponement of an announcement.


Warner Music, home to Madonna, Kid Rock and Missy Elliott, is the No. 4 music company with about 11.9 percent of the global market share.


Time Warner on Thursday opted to pursue talks with the Bronfman camp rather than a rival offer from No. 3 music company EMI Group Plc (EMI.L), whose roster includes The Beatles and Norah Jones.


EMI met with Warner Music officials over the weekend to highlight the benefits of its offer, sources said, emphasizing as much as $300 million of cost savings that could result from combining the recorded music units of the two companies. EMI bid about $1 billion for a majority stake in the combined company, sources have said.


Before Saban's re-entry, Bronfman and the private equity firms were to put up about $1.35 billion of equity and rely on debt funding for the rest of the deal. Thomas H. Lee would put up about $600 million, Bain $350 million, Bronfman $250 million and Providence Equity $150 million, said people familiar with the deal.


However, with Saban back in, it was not immediately clear how much money each would put in to the deal, which is expected to close in about two months.


The firms aim to rely on the steady income of the music publishing business, Warner Chappell, as they seek to reshape the recorded music unit by cutting costs. In recent years, the music industry has watched retail sales dwindle in the face of steep competition from free online file-sharing services.


As part of the deal, Time Warner will have the option of buying a 15 percent stake in Warner Music three years after the deal closes at a 25 percent discount from the assessed fair market value, one source said.


Separately, Time Warner also could opt for a 19.9 percent stake in Warner Music, which will keep its name, if the investor group merges it with another industry rival later on, sources have said.


The companies expect Warner Music Chairman Roger Ames to stay on and help run the business with Bronfman.


For Bronfman, the deal marks something of a chance at redemption. He built the world's biggest music company, Universal Music, while at Seagram, but then sold the company to Vivendi in a stock deal that wound up costing him and his family hundreds of millions of dollars.


He tried to buy back some of the Universal assets this summer, but ultimately was bested in the auction by General Electric Co.'s (GE) NBC television network.


Spokespeople for Time Warner, Warner Music, Bronfman, Saban and Providence Equity declined to comment. Officials from Thomas H. Lee, Bain and EMI could not immediately be reached. (Additional reporting by Merissa Marr in London and Derek Caney in New York)

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NEWSFLASH
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posted December 01, 2003 10:01 AM     Click Here to See the Profile for NEWSFLASH   Click Here to Email NEWSFLASH     Edit/Delete Message   Reply w/Quote
NEW YORK, Dec 1 (Reuters) - Comcast Corp. and Time Warner Inc. said on Monday they agreed to combine their cable partnerships in Kansas City, Missouri, and Texas, and to allow either company to trigger a dissolution of the combined entity in two years.

Texas Cable Partners serves about 1.2 million subscribers and Kansas City Cable Partners has about 300,000 subscribers. Time Warner, the world's largest media company, and Comcast, the No. 1 U.S. cable provider, are 50/50 partners in the ventures.

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posted December 01, 2003 10:29 AM     Click Here to See the Profile for NEWSFLASH   Click Here to Email NEWSFLASH     Edit/Delete Message   Reply w/Quote
Jacko Almost Bought Warner Music Catalog

Friday’s New York Times was all atwitter about corporate music grinder Andrew Lloyd Webber seeking the publishing catalog of the now-sold Warner Music Group.

It’s called Warner Chappell Music, and includes, among thousands of titles, all of Michael Jackson’s solo hits like "Billie Jean" and "Beat It" from his "Thriller," "Bad," "Dangerous," "HIStory" and "Invincible" albums.

But Lloyd Webber’s interest in Warner Chappell is not the first from a composer. I can tell you now that Jackson himself thought he was buying Warner Chappell just two months ago.

Jackson’s advisors — now in disarray — were unified during the summer. They figured out that Jackson’s half interest in Sony/ATV Music (aka the Beatles catalog, et al) would be enough collateral to launch an inventive deal. They engaged investment bankers at Goldman Sachs, who put together a firm offer for Sony/ATV to buy Warner Chappell. This would have brought all of Jackson’s major publishing holdings together under one roof.

But luck has never been on Jackson’s side concerning such matters. Just as the Goldman Sachs deal looked ready to roll, Warner Music got out of its other merger deals and looked to Edgar Bronfman’s group as a potential buyer. Bronfman wanted the publishing company as well as the record catalog. Almost simultaneously, the Santa Barbara DA began to make his move on Jackson. There was no way at that point for the plans to jell.

Even more perplexing in the Jackson saga: Even though Jackson was making this deal, and even though he’d been on trial in Santa Maria earlier in 2003 for his breach of contract lawsuit with manager Marcel Avram, he never bothered to tell the lawyers and business people handling the Goldman-Warner-Sony proposal that the child-molestation case even existed. All of them — including such longtime Jackson legal advisers as John Branca, Steve Cochran (no relation to Johnnie) and Zia Modabber — found out when the world did, on the morning of Nov. 19 when the Neverland Ranch was raided by the Santa Barbara police department.

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posted December 08, 2003 09:23 AM     Click Here to See the Profile for NEWSFLASH   Click Here to Email NEWSFLASH     Edit/Delete Message   Reply w/Quote
December 8, 2003 -- Employees at Warner Music are outraged that their corporate parent, Time Warner, is yanking their stock options as part of the recent sale of the business, The Post has learned.
According to a memo that was recently distributed to employees - a copy of which was obtained by The Post - all unvested stock options for Warner Music employees will be immediately terminated.

Employees will receive a "retention bonus" for the unvested options, yet the size of the bonus will not necessarily reflect the value of the stock options, sources say.

This effectively means that Warner Music employees who have seen the value of their stock options decimated in recent years - following the disastrous merger with America Online - now have virtually no hope of benefiting should Time Warner stock rebound.

Spokespersons for Time Warner and Warner Music declined comment.

All stock options that have vested remain exercisable for one year, but the strike prices of these options - some in the $40 to $50 range - are so far above Time Warner's current share price of around $16 that it is unlikely they could ever become valuable within a year.

Meanwhile, unvested options that were granted last February in the $10 to $11 range - and thus are "in the money," providing the best chance for employees to make some money on the stock - will be lost.

Warner Music employees, who have worked amid enormous uncertainty this year as Time Warner shopped the division to a variety of suitors, see the yanking of the options as a final kick in the butt as they are shown the door.

Warner Music sources say that when Time Warner CEO Dick Parsons announced the pact to sell the division, he noted the deal was in the best interest of shareholders and that Warner Music employees are shareholders.

Time Warner retains an option to buy back a stake in Warner Music in the future, should the music industry rebound.

On Nov. 24, Time Warner announced it was selling the music division - which includes the recorded music unit as well as the music publishing business - to a group headed by Edgar Bronfman Jr. for about $2.6 billion. The private equity backers are Thomas H. Lee Partners, Bain Capital and Providence Equity Partners.

The deal marked Bronfman's return to the media industry following his decision to sell his family's Seagram liquor and entertainment empire to Vivendi in 2000.

It also ended months of uncertainty for Warner Music employees, who over the last year have seen Time Warner negotiating with music companies BMG and EMI about a possible deal.

The Bronfman deal is expected to close early next year, and is expected to result in scores of job losses. Sources say Bronfman is expecting to shave nearly $200 million in annual cost savings.

While employees who hang onto their jobs will suffer the options loss, staffers who get canned during the restructuring will get an additional week's pay for each year of service, according to the memo.

Under current policy, workers who are laid off without cause receive two weeks' pay for each year at the company.

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posted December 09, 2003 01:12 PM     Click Here to See the Profile for NEWSFLASH   Click Here to Email NEWSFLASH     Edit/Delete Message   Reply w/Quote
Merry Christmas!

NEW YORK - America Online is laying off 450 people, or 2 percent of its work force, as the struggling Internet service provider consolidates its software development operations in California.

AOL spokesman Jim Whitney said Tuesday the company would also close its software development offices in San Francisco and San Diego as it consolidates its development efforts in Irvine for southern California and Mountain View for northern California.

Whitney, confirming a Wall Street Journal story, said the job reductions would leave AOL with a work force of 19,000. Whitney said 100 of the people being laid off would be offered the opportunity to relocate.

Some of the aspects of the work being done by the people being fired would be consolidated into AOL's software development centers in White Plains, N.Y., and Dulles, Va., Whitney said. Most of the people being laid off were software engineers, he said.

He declined to say what software development might be stopped as a result of the job cuts. He said the work would not be outsourced.

The job cuts follow an earlier round of layoffs at AOL this spring, when the company cut 420 jobs in its call centers.

Shares of AOL fell 4 cents to $16.45 on the New York Stock Exchange (news - web sites).

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posted December 15, 2003 01:36 PM     Click Here to See the Profile for NEWSFLASH   Click Here to Email NEWSFLASH     Edit/Delete Message   Reply w/Quote
With Time Warner's fortunes rising again and company Chairman/CEO Richard Parsons indicating that it may once more explore major acquisitions, a "long-shot scenario" has emerged that the company might buy the Walt Disney Co., Newsweek reports in its current issue. The magazine quotes an unnamed senior Time Warner exec as saying, "The easy thing would be for Parsons to buy cable. ... 'Is he going to buy Walt Disney?' is the more interesting question." The magazine also quotes other Time Warner execs as saying that Parsons is likely to make a bid for Disney only if an expected hostile-takeover attempt by Comcast materializes.

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indiedan
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posted December 18, 2003 09:24 AM     Click Here to See the Profile for indiedan   Click Here to Email indiedan     Edit/Delete Message   Reply w/Quote
Time Warner said in talks with MGM
Trade publication Variety reports home of Warner Bros., New Line, in active merger talks with MGM.
December 18, 2003: 12:01 PM EST

NEW YORK (CNN/Money) - Harry Potter and Frodo, meet Mr. Bond, James Bond.

The Hollywood industry publication Variety is reporting that Time Warner Inc. is in active merger talks with Metro-Goldwyn-Mayer Inc., the largest movie studio that is not part of a larger media conglomerate.

Time Warner already owns two major studios -- Warner Bros., home of the successful Harry Potter series of films, and New Line Cinema, home of the Lord of the Rings trilogy, which opened its third movie this week to strong reviews. MGM's strongest franchise is the long-running James Bond series. Time Warner also owns CNN/Money.

Calls to MGM were referred to the studio's West Coast office, and a spokesman there was not immediately available for comment. A spokeswoman for Time Warner also had no comment on the report.

But one person at one of the companies said that while there are discussions going on, nothing is imminent.

The move would be somewhat out of character for Time Warner, which has concentrated on selling assets in recent years, not acquiring them, as it tries to cut its debt.

It recently agreed to sell its Warner Music unit for $2.6 billion, and it sat out the bidding for the Vivendi Universal's U.S. entertainment assets, including Universal Pictures, assets for which MGM acknowledged making an unsuccessful bid. General Electric's NBC is merging its operations with Vivendi Universal Entertainment in the United States.

But Time Warner top executives said recently that efforts to reduce debt are ahead of schedule and that a strong cash flow had lessened the need for asset sales.

A sale of MGM, controlled by financier Kirk Kerkorian, is less of a surprise. It had been widely assumed that the company needed a combination with a larger media operation, and when its bid for Universal Pictures fell short, a sale became more likely.

Variety reported that MGM Chairman and CEO Alex Yemenidjian told reporters at an investors conference last week that MGM would only consider a full-blown merger rather than a sale of individual assets. He said he was not suggesting any specific negotiations were ongoing at that time, however.

The trade publication said MGM's chief asset is its 4,000-plus movie library, especially when DVD sales are becoming the most important revenue stream for studios as past movie hits are scoring new sales in the DVD format. Warner Bros. distributed MGM home video titles for several years until 1999, Variety noted, and it already owns rights to pre-1985 MGM titles.

In its report, Variety quoted bankers as saying the film library alone is worth $18 a share, or about $4.4 billion. Shares of MGM (MGM: up $0.85 to $17.10, Research, Estimates) jumped about 5 percent in active New York Stock Exchange trading Thursday.

Kerkorian owns about two-thirds of MGM shares outstanding. Variety said he bought most of his shares for about $15 apiece when he reacquired control of the studio in 1996.

Time Warner (TWX: up $0.16 to $17.70, Research, Estimates) stock rose about 1 percent, also on the NYSE.

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posted December 19, 2003 10:59 AM     Click Here to See the Profile for NEWSFLASH   Click Here to Email NEWSFLASH     Edit/Delete Message   Reply w/Quote
Time Warner, which recently dropped AOL from its name, may soon add three other famous letters: MGM. According to published reporters, Time Warner, which recently said that it is again in the market for prominent acquisitions, has held preliminary merger talks with Metro Goldwyn Mayer. Time Warner, which already owns the Warner Brothers and New Line Cinema studios, is reportedly interested primarily in MGM's vast library that includes some 4,000 titles.

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indiedan
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posted December 23, 2003 03:05 PM     Click Here to See the Profile for indiedan   Click Here to Email indiedan     Edit/Delete Message   Reply w/Quote
The strong box-office performance of The Lord of the Rings: The Return of the King -- it took in $73 million over the weekend and $124 million over its first five days -- may have come as a godsend to Time Warner, which owns New Line Cinema, the film's producer, analysts observed Monday. The company, plagued in recent years by its disastrous merger with AOL, management turmoil, and regulatory investigations, could see returns of as much as $1 billion from worldwide ticket sales, they indicated. (However, today's (Tuesday) Wall Street Journal points out that New Line Cinema hedged its bet on the trilogy by getting two thirds of its funding from international distributors and giving away a commensurate piece of the action. It therefore was able to record a profit of only $300 million on EBITDA of $920 million for the last Rings sequel, The Two Towers. In addition to the $124 million it racked up domestically, the film took in another $121 million abroad, despite the fact that it has yet to open in numerous movie-loving countries, including Japan and Australia. "This is an unprecedented convergence of box office success and critical acclaim," Exhibitor Relations chief Paul Dergarabedian told the Los Angeles Daily News. "Usually, the trajectory with a trilogy is that box office for the third film goes down. To see that a third film is going to beat its predecessors is unprecedented."

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indiedan
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posted December 29, 2003 09:32 AM     Click Here to See the Profile for indiedan   Click Here to Email indiedan     Edit/Delete Message   Reply w/Quote
Time Warner can deal from strength
Even with AOL's problems, the media giant seeks growth

By Jon Friedman, CBS.MarketWatch.com

NEW YORK (CBS.MW) -- Finally, Time Warner shareholders can enter a new year with more confidence and less trepidation.

Finally, Time Warner can start a year without fear

For the first time since $165 billion merger between Time Warner and America Online closed in January 2001, there are positive things to say about the New York-based behemoth.

Three years ago, flush from wrapping up the huge deal, excited executives promised Wall Street that the combined company would have revenue of $40 billion. When they fell short of that lofty and ultimately foolish prediction, analysts and investors reacted angrily.

But in 2003, Time Warner (TWX: news, chart) surpassed expectations by slicing its debt burden to $20 billion -- a year ahead of schedule, executives crow -- from a high of $30 billion. That progress helped the company's stock join the wave of big-cap issues that roared in 2003. Its shares are up 36 percent this year, while the benchmark Standard & Poor's 500 Index is up 24 percent.

Next month, Time Warner will wrap up a deal to sell its stumbling Warner Music business for $2.6 billion to Edgar Bronfman Jr. It has already sold off its dead-end sports franchises and its stake in the Comedy Central cable channel.

To continue marching forward, Time Warner must do more than sell properties. Defensive maneuvers won't be enough to sway the skeptics, who will remain unimpressed until Time Warner can exhibit solid sales growth across the board.

The company must demonstrate real signs of progress at its troublesome America Online unit, continue its booming performance in movies and expand in the potentially lucrative cable business. Among prospective deals in the offing, Time Warner has been rumored to be a suitor for the Metro-Goldwyn-Mayer (MGM: news, chart) movie company.

"The problem is that America Online is not really seen as a product that people need to get Internet access any more," said Patrick Adams, manager of the Long-Short Fund in Denver.

Time Warner spokespeople decline to comment on speculation that media magnate Barry Diller, head of InterActiveCorp. (IACI: news, chart), has approached Time Warner CEO Dick Parsons about doing a deal for part or all of America Online.

Time Warner executives have been encouraged by the welcoming reviews for the new AOL 9.0 software program, and they privately say that AOL's European arm will turn a profit in 2004.

Strategy

Parsons sensibly seems committed to Time Warner's strategy of expanding in subscription-revenue-oriented businesses such as cable television along with magazine publishing, which stands to benefit from what is being ballyhooed as a strong year for advertising with the presidential race and the Athens Olympics ahead.

"For Time Warner's operations, the key question involves advertising trends," Adams said. "We saw quite a few stops and starts so far this year."

It's possible that Time Warner could take a run at cable giant Cablevision (CVC: news, chart), which has been trying to dig its way out of trouble by selling various assets. It sold the Bravo cable channel to the NBC unit of General Electric (GE: news, chart).

It's a positive sign that Time Warner is being mentioned as a hunter of deals, not merely a seller of assets. CEO Dick Parsons, reflecting the company's growing confidence, no longer sounds defensive when he talks about the future. In fact, his new pet phrase is "turning the telescope around," saying a symbol of his goal to produce tangible growth in 2004 while no longer fixating over the need to cut the company's debt burden.

That's a far cry from the recent past, when it seemed as if having the top job at what used to be called AOL Time Warner always meant having to say you were sorry, to shareholders. (Time Warner dropped the AOL part of the name a few months ago).

Following a series of high-profile resignations by prominent officials, Parsons has worked hard to restore a sense of calm and confidence.

"Even with the management foibles of the last several years, the company's properties are showing promise," said Michael Holland, president of investment company Holland & Co. "In 2004, this could be a franchise play in that it has strong positions in key media businesses."

Worries

Still, Time Warner has much to worry about. The Securities and Exchange Commission has been investigating for more than a year possible wrongdoing at the AOL subsidiary, dragging down the potential gains of the stock at times and casting a pall over Time Warner's hope to put the division's problems behind it, for once and for all.

Further, as successful as Time Warner has been with its "Lord of the Rings," "Matrix" and "Harry Potter" movie franchises, the company has a tremendous burden to live up to in 2004. In fact, it could be argued that Hollywood is now the center of Time Warner, and not its AOL branch in Virginia or its New York publishing arm or its CNN headquarters in Atlanta.

"The Lord of the Rings: The Return of the King," the final installment in the trilogy released Time Warner's New Line Cinema, racked up $125 million in ticket sales in its first five days in North American theaters.

"They're facing some tough comparisons in the movie business," said James McGlynn, manager of the Summit Fund in Cincinnati, which owns Time Warner shares.

What a difference a year makes, especially when the stock market is sizzling after a prolonged bear market. Last Feb. 13, Time Warner's shares traded under $10. On Wall Street, speculation centered on how low the stock would go.

Now there's a different kind of concern. "This stock has had a tremendous run, so the easy money has already been made by people who bought the shares when they were in oblivion, trading under $10," noted Summit's McGlynn.

"The stock is getting a little rich," said Adams.

Time Warner's stock is too expensive? It's a big change from cynics griping that AOL is hopelessly behind the times and that Time Warner's stock is stuck in mud.

Indeed, a catcall that Time Warner's stock is no longer a steal is the kind of trepidation that Parsons can live with.

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