In the sagging post-attack economy, even media moguls feel the pinch
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It hasn’t been the best year to be a mogul. Any mogul. Just ask the analysts. They’ll tell you how 2001 split in two: the bad part before Sept. 11, when companies watched stock prices and revenues slide as the economy sputtered, and the bad part after Sept. 11, when things tumbled into a free fall. And given the political situation, economy, and consumer spending rates, no one is predicting a turnaround next year. So if you’re a multinational media titan right now, what you need is sweet, plentiful cash to weather the unknown and provide flexibility.

While the current economy is bad, it’s worse for some than others. ENTERTAINMENT WEEKLY consulted seven financial analysts specializing in the entertainment biz for their takes on how the bigwigs are weathering the storm. And the media titan it’s least awful for is…

1 AOL TIME WARNER

OFFICERS Steve Case, Chairman; Gerald Levin, CEO; Robert W. Pittman, Co-COO; Richard D. Parsons, Co-COO

CREDITS Sheer size. Current market cap of $149 billion makes it the world’s largest media company. Cross-platform promotions appear to be working (Harry Potter will be a test). AOL continues to grow, along with monthly fees. Purchased British-based IPC magazine group, with plans to sell mags over AOL. Tightened belt by closing studio stores. Highly anticipated franchises include Lord of the Rings and the Potter flicks, which some estimate will earn $2 billion over their lifetime. And hey, it owns EW! DEBITS An overcrowded film sked means movies get mishandled too often. The music division has been spotty (it missed the recent teen-pop boom), and its recent executive-suite overhaul was long overdue, but it’s showing signs of a turnaround (Linkin Park, P.O.D., Staind). Online music initiative slow to develop. WB’s loss of Buffy the Vampire Slayer to UPN (where it’s thriving) may drain the teen audience. And putting Ted Turner on ice caused worries. PROSPECTS Of all the media companies, AOL Time Warner is the best-insulated because of critical cash reserves, reasonable debt-service rates and 45 percent of revenue coming from subscriptions to properties such as HBO, AOL, and magazines. And that CNN remake came just in time, didn’t it?

2 NEWS CORPORATION

OFFICERS Rupert Murdoch, Chairman-CE; Peter Chernin, President-COO

CREDITS TV business is cooking. Closed $4.4 billion purchase of 10 TV stations from Chris-Craft. Fox News Channel’s share of the cable audience has zipped past buzzless MSNBC to become a legitimate competitor against CNN. Fox TV production division is largest supplier of programming to networks and poised to cash in on the syndication of King of the Hill, Ally McBeal, Buffy, and the like. DEBITS Top brass have been preoccupied for months putting together the DirecTV buy. The drop in ad revenue from newspaper holdings stung. Fox News Channel lost Paula Zahn to rival CNN, and the cost of staying competitive in the TV news biz could be substantial in the coming year. PROSPECTS Solid, particularly if the DirecTV deal closes and Fox can distribute its content on a worldwide satellite platform.

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