[This report is based on remarks made by Time Warner Chairman and CEO Jeff Bewkes at the TVWeek Innovation360 Conference on Tuesday, Oct. 13, in New York City. It is primarily written by Andrew Hampp of Advertising Age, with a minor contribution from TVWeek’s Chuck Ross]
As reports amass around NBC Universal’s potential future corporate owners, you can officially count out Time Warner Chairman-CEO Jeff Bewkes among the interested parties.
Bewkes reiterated remarks he has made previously that Time Warner is not interested in buying NBC Universal.
He then explained why Time Warner wasn’t interested in NBCU, which touched both on his philosophy of mergers and acquisitions and his explanation as to why it was a bad idea for Time Warner to have merged with AOL in the first place.
Two misguided philosophies of media mergers and acquisitions are often cited, he said. One, "we’re great, so we can do it better," and two, "synergy." He then went on to note that in theory "there are certainly cases where their assets could complement each other. Like when Turner merged with HBO, that made sense because they were like businesses. But there are a lot of times where properties are not very connected."
Time Warner is in the process of ending its own failed media merger with AOL, which bought Time Warner in 2000 on the misguided premise that it could persuade rival media companies to use AOL as their sole online subscription service. "What’s amazing is how little scrutiny there was over that premise," he said of AOL’s failed bid to become a cable-like content brand online. "Nobody had that discussion at the time."
Bewkes pointed to Time Warner Cable’s recent spin-off from its corporate parent as a sign of media disaggregation done well. "They figured out the difference between being a content company vs. a distributor, and their stock has been at the high end since the spin-off," he said. "The question was, would each of us be able to focus on our assets and be valued? And now our stock is on the high end, too."
Bewkes is still a firm believer in the future of Time Inc., a publishing portfolio he insists is not for sale, despite recent rumors. "No publishing company can ever say they wouldn’t consider restructuring," he said. "But we have in that business a pretty healthy readership. There’s a lot of myths that newspapers show the way of magazines, but newspapers rely on local, classified advertising, which magazines just aren’t exposed to. Our magazines’ readership is holding up, the brand position is actually increasing for competition, although there’s certainly more change needed in the news category than celebrity."#