New York -- Time Warner Inc. chairman and CEO Richard Parsons apparently took his meeting with corporate raider Carl Icahn last month to heart, telling the audience at an investor conference here Wednesday morning that the media giant is “looking hard” at increasing its share-buyback program and could reduce its holdings in cable.
Icahn -- who said earlier this month that he would seek at least one seat on Time Warner’s board of directors -- has urged management to increase its share-buyback program from the current $5 billion to $20 billion and to divest its Time Warner Cable assets.
While Parsons didn’t go that far, he said at the Goldman Sachs & Co. Communacopia media-investment conference that a bigger buyback is not out of the question.
Parsons added that while he is comfortable with Time Warner’s plan to retain an 84% stake in Time Warner Cable after the unit is spun off next year, that could change over time, especially if Time Warner continued to grow its cable footprint.
However, Parsons quickly added that he is bullish on cable and that the unit is strategically important. “Now is not the time to cast it off,” he said of the cable unit.
Parsons said his top two priorities now are to accelerate the transactional business model of its America Online Inc. Internet unit and to refine Time Warner’s capital-allocation process.
“What we need to do its accelerate the path we’ve been on -- moving AOL from solely or largely depending on subscription revenue and move it to more of an audience-based business,” Parsons said, adding that while AOL would not abandon the access business, it could add a portal function akin to online search engines Yahoo! Inc.(www.yahoo.com) or Google (www.google.com).
In other presentations at the conference, News Corp. chairman Rupert Murdoch said his company’s new Fox Business Channel cable network could launch in the early months of next year. Murdoch also predicted that voice services will be free and ubiquitous in the next two or three years, given the raft of free Internet-telephone services from Skype Technologies S.A., Yahoo and Google.
Comcast Corp. chairman and CEO Brian Roberts touted his MSO’s video-on-demand offerings, adding that the MSO should end the year with 1.5 billion VOD sessions, up from the 1 billion previously predicted.
Roberts also took exception to Murdoch’s take on the free future of voice service. “I would have to respectfully disagree with Rupert,” he said. “It’s nice for guys who are not in the business to say, ‘Oh, it’s all going to be free someday.’”
