By: Jenna Ritter
“Big media today wants to own the faucet, pipeline, water, and the reservoir. The rain and clouds come next.” -Ted Turner. He is right. Tuner sold his company to Time Warner. Today, media companies have to own everything up and down the media chain. Here is a look at one of the largest media conglomerates in the world: Time Warner.
In 1923, Time, a magazine that comes out weekly and was founded by Henry Luce and Briton Hadden. They had borrowed $86,375 from friends and Yale classmates to get started. From there, this company grew fast and turned over a profit in just one year. Time got involved in television when they bought $7.5 million of satellite time during HBO programming. In 1986 it acquired American Express share of Warner-AMEX Cable.
The company then merged with Time Inc. and Warner Communications. Four years later they acquired Turner Broadcasting System of Filmed Entertainment, Cable Networks, Publishing and Cable Systems divisions. In 1996, Time Warner announced a joint venture with AT&T and just four year later in 2000, Time Warner and America Online announced a $181 billion merger. As you can see, this company grew fast and now is one of the largest media corporations in the world.
Time Warner’s Commodities:
Time Warner owns: Home Box Office (HBO),Time Inc., Turner Broadcasting System, Warner Bros. Entertainment Inc., CW Network (partial ownnership), Time Warner Investments Group, TMZ, New Line Cinema, Cinemax, Cartoon Network, TBS, MapQuest, Sports Illustrated, Fortune, Health, and People Magazine. To name just a few…here is the complete list.
Connecting the Dots:
There are two levels of corporate control: operational and allocative. Operational control is the management and CEO’s. They are elected at the allocative level, that includes the large shareholders as well as the board that deal with mergers, franchising, and acquisitions. Some important members of the board include Stephen F. Bollenbach who is also linked with Macy’s and American International Group. James L. Barksdale who sits on the board of Sun Microsystyms who is also linked to Bank of America, and Federal Express Corporation. Robert C. Clark who is linked with the giant Omnicom group and HAA-CREF, Richard D. Parsons with Estee Lauder and Citigroup. Time Warner is connected to almost every large bank in the U.S…. talk about concentration! All the power is connected. For a complete list of Time Warner’s board members and what large companies they are linked with go here.
There have been plenty of controversies involving Time Warner. Although they may not get a lot of news coverage because the company owns major news outlets. One major controversy was Time Warner’s merger with AOL. There was some public discontentment with this large deal being approved.
There have also been protests against this corporation on the individual side. Alan Moore’s protest over the intellectual property rights to his graphic novels (V for Vendetta, Watchment, League of Extraordinary, From Hell, etc.). Moore did not want these books turned into movies, but ended up losing the rights through litigation. Time Warner claimed ownership through its subsidiary, DC comics.
Another controversy was the construction of Warner Village in Abu Dhabi.
The local population may not be happy when corporations build properties around the world. But, who is listening to the minority voice?
“Globalization Theories” by: Annabelle Sreberyny says, the world is a single space and has the ability of spacial connectivity through technological convergence. The economic capitals logic central driving force is globalization. As you can see that is exactly what Time Warner is doing by having over 200 subsidiaries worldwide. This corporation expects globalization to provide “growth tonic” and large annual sales growth.
Time Warner has used it’s power to lobby the government for many reasons. One example is in 2005, Time Warner donated $250,000 to George W. Bush’s second presidential inauguration (the maximum contribution).
Time Warner is part of the big six media conglomerates that control the majority of all media we consumer. The main completion and other five huge conglomerates are Walt Disney, Viacom, News Corporation, CBS Corporation, and NBC Universal.
In the most recent 3rd quarter, Time Warner Revenues revenues rose 11% to $7.1 billion. This is its highest growth rate since third quarter of 2007. Go here to see complete financial results and here to see quarterly earnings from 2008-2011 go here.
Time Warner has demonstrated strategies to maximize profit by merging with AOL and also Turner Broadcasting. When doing so, it acquired large and extremely powerful assets like CNN, TNT, and New Line Cinema. It now has major control over not just old media, but new. As a current strategy, it is focusing on a stock repurchasing program and now has110 Million shares of common stock Time Warner
Time Warner is extremely horizontally and vertically integrated. It has expanded into television, radio, print, web, news programming, and even the NBA. Because of this diversification it uses synergy between all its media outlets to promote their services and media commodities. This company has the ability to put advertisements EVERYWHERE. Through horizontal integration it bought out once independent magazines that cater to very different audience demographics so they can target EVERYONE. It is vertically integrated by owning internet services, production, distribution, marketing, publishing, music, and cable activities. Across every stream of media, it can be promoting one of their commodities. With this extreme cross-market promotion it has created a system greater than its parts with synergy, diversification, franchising, concentration, globalization, and essentially…..GLOBAL DOMINATION with the main goal of MAXIMIZING profit.
“Media Conglomerates”, by Daniel Biltereyst says when using the public sphere theory you see that corporations homogenize cultural production and restrict critical media which leads to Americanization, Eurocentrism, or cultural imperialism. We have restricted media now because these corporations are so large they can control content through almost all mediums.
The Time Warner corporation controls the majority of what we watch, hear, and read and every single day. And when a corporation can control all of these areas of humans consumption they gain control over what we think. Americans need to stop and think about who is feeding them their information.