Darkbeer
11-24-2002, 08:31 PM
The Case Against an ABC/CNN Merger (http://www.businessweek.com/magazine/content/02_48/b3810105.htm) - Business Week, 12/2/02
QuikQuote: At first glance, merging ABC News and CNN seems like a compelling business proposition, saving $100 million to $200 million in costs. Paring that kind of expense is exactly the kind of message that ABC parent Walt Disney Co. (DIS ) and CNN parent AOL Time Warner Inc. (AOL ) want to broadcast to a Wall Street bearish on both media empires. This year, Disney's stock is down 12%, and AOL's is down 53%. And as war with Iraq looms, the price tag for covering the news is only trending higher.
What's more, the fit between the news operations appears to be good. ABC is a broadcast network with big-name on-air personalities and an emphasis on in-depth coverage. CNN reaches households by cable with its nimble, nonstop coverage of global news. Push the two weakened organizations together and you've created a much stronger worldwide news operation, right? Wrong.
QuikQuote: At first glance, merging ABC News and CNN seems like a compelling business proposition, saving $100 million to $200 million in costs. Paring that kind of expense is exactly the kind of message that ABC parent Walt Disney Co. (DIS ) and CNN parent AOL Time Warner Inc. (AOL ) want to broadcast to a Wall Street bearish on both media empires. This year, Disney's stock is down 12%, and AOL's is down 53%. And as war with Iraq looms, the price tag for covering the news is only trending higher.
What's more, the fit between the news operations appears to be good. ABC is a broadcast network with big-name on-air personalities and an emphasis on in-depth coverage. CNN reaches households by cable with its nimble, nonstop coverage of global news. Push the two weakened organizations together and you've created a much stronger worldwide news operation, right? Wrong.