Huge Investment Decision for Time Warner

As of Monday, March 23rd, Time Warner has decided to invest $241.5 million in Central Media Enterprises which is a TV outlet in Europe. The company labeled CME is a broadcaster in Bulgaria, Croatia, and the Czech Republic and Time Warner is fortunate enough to hold a thirty-one percent stake in the company. The astounding amount of money that will be invested by TW will get them two seats on CME’s board.
With this newest decision, CME has also found a way to make a partnership with Time Warner Bro’s movie studio to launch and operate Warner-branded channels in the company’s areas. This channel will constantly run feature international films and television series. Thanks to the spinoff of the cable unit, time Warner is expected to receive $9.25 billion and will consider to acquire future international companies. CEO Jeffrey Bewkes released a statement on the acquisition in saying, “While the (Central European) region has been experiencing the impact of the global economic crisis, we believe CME is ideally positioned over the long term as Central and Eastern Europe returns to significant growth and the media sector in these countries continues to evolve.”
This once again demonstrates Time Warner’s ability to survive and succeed through the economic downturn that we are facing. With almost ten billion alone in expected television profit, they will make a ton more than that with their feature films that citizens are still flocking to see. Of course there is some risk in this partnership due to the overseas liability with CME. Considering they are now in a partnership, Time Warner now must focus on CME’s possible path to success as well with hopes that both sides are satisfied.
Adegoke, Yinka. "Time Warner Buys Stake in Central European media co." March 23, 2009.
http://www.reuters.com/article/americasDealsNews/idUSTRE52M2Y220090323

"Watchmen" Gives Boost

Time Warner’s Warner Bros. has once again hit the jackpot with the mega-movie “Watchmen.” Over the weekend the film produced $55.7 million at the box office in its first opening weekend. Although it was about five million less than expected, these numbers are still extremely impressive considering economic conditions. Films usually perform well during economic downturn however for a number of reasons. “The movie industry often performs well during times of economic downturn, in part because a night out at the movies can cost less than rival forms of entertainment such as concerts or professional sports events” (Schuker). President of the media, Paul Dergarabedian also made a statement regarding the recent success of the movie-going business. "We've been carrying this momentum forward since Christmas of last year and the 'Watchmen' weekend kept it going, Whatever is coming out in the theaters, audiences are lining up to see it. Recession-era moviegoing is in full swing.” Many believe the film would have made more had it not been so long. A film with a run time of two hours and forty minutes means less screenings for more tickets to be sold.
While this is good news for Time Warner I disagree with Schuker’s opinion on the movie industry. While the industry is usually recession proof, I believe it is more successful because of the form of escape. People are able to engulf themselves in film instead of dealing with reality at home. The reality at the theatre is far different from what it used to be. A trip to the movies is about twenty dollars nowadays at the least. Ticket-$11, popcorn-$5, water-$5.

Schuker, Lauren. “'Watchmen' Keeps Ticket Sales On Hot Streak at Movie Houses.” March 9,
2009. http://online.wsj.com/article/SB123653679431864173.html?mod=wsjcrmain.

India Market update

Turner International, a company owned by Time Warner announced that one of its precious market’s, the Indian market is expected to have a slower growth in profit than the record year of 2008. President of Turner International Asia-Pacific Stephen Marcopoto stated “The last calendar year was a record year for us with growth in the high teens.” Expectations of this year will be a high single digit growth which is a bit more than half of what they recorded last year. Although India is the biggest market for the company, lower advertising revenue is the reason to blame the decreased projected year. While announcing this unfortunate piece of news to the media, Marcopoto essentially saved himself by saying, “I can't stress just how dynamic and resilient the Indian market is... it is healthy compared to some other markets which are struggling with low or flat growth” (Marcopoto).
Marcopoto made a great move by encouraging stakeholders, stockholders, and people interested in the company with his second statement. The Indian market will also see his boost of confidence in them and will surely continue to engage with Time Warner financially.

Luthra, Nitin. "Turner Expects its Idia Growth to Slow." March 4, 2009.
http://online.wsj.com/article/SB123616138247127981.html?mod=msn_money_ticker&ru=msn_money