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Time Warner Chairman and CEO Dick Parsons was joined by COO Jeff Newkes and CFO Wayne Pace for the 1Q06 earnings call. Some highlights:
AOL: Parsons talked about AOL’s two-part strategy of encouraging dial-up subs to move to broadband, which is less expensive to operate, and launching the ad-supported AOL.com. If the former, Parsons said, “Although it is still early, the results so far have been in line with our expectations.”
— Parsons: “Going forward, we plan to drive more traffic to AOL’s network of online properties, as well as drive higher usage of them and then continue to monetize that audience effectively. We believe our expanded partnership with Google, which we closed last month, will give us renewed momentum in this regard.”
— Paid search and pay-per-performance advertsing increased by 25 percent.
— In response to a question, COO Jeff Bewkes said “our sales effort has been improving steadily. Essentially, we stabilized it in the last quarter of 2005, and we are pretty happy with the progress we’re making there. … Some of it has to do with getting DoubleClick online. We benefit from Ad.com’s ability to bring systems to us. … We feel pretty good about the unique visitors at the AOL.com site. Page views are low from non-members on that site, but they are growing.”
— Bewkes: AOL Europe’s future is being evaluated and the ownership structure could change. “We’re not saying we have reached that conclusion, but we want to make AOL Europe as profitable as it can be in whatever ownership structure would bring that about.”
Time Warner Cable: Parsons said he thinks TWC “delivered the best quarter in its history. … Looking ahead, for as long as we execute on our strategy, we only see Cable’s competitive position getting stronger. So, while the phone companies are only starting to dig up your yard, cable is already in your house, providing the best products and services available. This is critically important.”
Time Inc.: Parsons said it was “fair” to say Time Inc.’s results were “less robust” than expected due to less advertising demand but that the shortfall isn’t meaningful enough to cause us significant concern” for the rest of 2006. The first quarter is usually the lowest of the year for Time Inc. Bewkes talked about the importance of Time Inc.’s brands online and in mobile; “basically, our focus is to drive these brands online, to keep our readership and brand position strong.”
CourtTV: Parsons confirmed reports that TWX is in discussions to acquire Liberty Media’s 50 percent for cash and an announcement could come in the “very near future.”
For more details, check the SeekingAlpha transcript.
Related: Earnings: Time Warner Profits Up; AOL Revs Down; AOL Ad Revs Up 26 Percent