CEO salutes netco
“A tip of the hat to those guys,” said Richard Parsons in reaction to the Google acquisition of YouTube, but he quickly added that whether it will be a “value-adding property” remains to be seen.
If anyone was to go after the Web site, though, Google was the logical candidate. “We know them. They have a traffic monetization engine that no one else has,” Parsons said.
In town to pick up an award for his achievements in turning around the Time Warner empire, the chairman-CEO responded to a variety of other questions related to the media topics du jour as well as to potential moves by his own conglom.
He admitted that his own AOL unit would have liked him to make an offer for the user-generated content site but Parsons said it just wouldn’t have been justifiable. (Google mostly paid for YouTube with its own stock.)
“To acquire a company with no earnings? You can’t hit every pitch that’s thrown,” he reasoned.
More generally, Parsons was neither overly enthusiastic nor outright dismissive on the hot-button issue of user-generated content.
“What’s the real place of (user-generated content)? Where is it going and how will people make a business of it? I think it’s another supplemental way people inform and entertain themselves, but I don’t think it will overrun professionally generated content,” he told the international media press.
Parsons also said he didn’t know if entitles like MySpace, YouTube and Facebook would be brands 10 years from now, pointing out though that TW is concertedly moving its own brands out onto the Web and broadband space. People.com, for example, is No. 1 in its celebrity space, because, Parsons argued, of its brand authenticity.
As for why Time Warner stock is suddenly above $19 a share, Parsons cited three likely reasons: Cable is back in favor with Wall Street, and TW, as a major player, has benefited; the TW balance sheet has been cleaned up; and the company engineered a $14 billion buyback of its own shares.
“It has simply reached a tipping point,” Parsons surmised, “and the market is responding.”
Would maverick investor Carl Icahn now leave him alone?
“From your lips to God’s ears,” he quipped.
Along with recent moves to rethink the AOL business model and shed some non-core assets, Parsons suggested that international expansion is on his list of priorities.
“Technology and international are where the growth is,” he said.
And Europe is the first place to look: There are established platforms, money and a similar cultural orientation, he explained.
While he put the kibosh on rumors that Time Warner would go after Brit broadcaster ITV or cable systems on the Continent, Parsons intimated that European businesses complementary to or enhancing AOL would be looked at closely.
As it turned out, at the dinner Wednesday in honor of the TW chairman-CEO, he was seated next to the chief exec of Germany’s Axel Springer Group, Matthias Doepfner, leading some to speculate what the two were discussing over the pate. (Doepfner recently joined the TW board. )
Closer to home Parsons described Cablevision as “a fine asset that fits within our footprint” but said he would not be proactive in trying to buy the company.
“If and when they’re ready, Chuck and Jimmy (Dolan) will come to see me,” Parsons said. The Dolans own 75% of their company. TW recently spent $13 billion on another cable op, Adelphia.
Asked about his own rumored political ambitions, Parsons made a diplomatic side step.
“Right now my focus is on Time Warner. Beyond that, I may go back to Italy and become a full-time vintner,” he joked.
Upon receiving his award as personality of the year, Parsons kept his remarks short and self-deprecating.
“It’s a staggering honor. The last time I had anyone be this nice to me is when I was elected president of my third-grade class — two years in a row.”