September 23, 1995
Web posted at: 2:40 p.m. EDT
From Correspondent Paul Vercammen
HOLLYWOOD, California (CNN) -- Turn on your television or listen to the radio and you're likely to run across something created by either Time Warner or Turner Broadcasting. Some of the highest rated, highest selling, hottest products in the entertainment/information business are owned by these two giants. The one-time rivals are now tying the corporate knot.
Like the buddies in Warner Brother's hit television show, "Friends," Time Warner and Turner Broadcasting will sit side by side to swap ideas and share resources. Time Warner CEO Gerald Levin calls the merger a "dream deal." Mogul Ted Turner and Levin are creating infinite options for cross-promotion and spin-offs, considering all of their TV programs and TV channels, movies and music acts. Time Warner's got Madonna and Led Zeppelin; Turner's got "Gone With the Wind" and "Singin' in the Rain."
It's a merger not so much about fixed assets like real estate or TV stations, but about flexible avenues for distribution and prized creative products, like television programs.
And what does tenacious Ted Turner have to say? "I'm tired of being small. I want to be big," Turner Broadcasting's CEO said at a press conference announcing the merger Friday.
Warner makes some of the highest-rated, highly-honored shows, including "E.R.," "Murphy Brown," and "Lois and Clark." Turner, through its Castle Rock unit, offers the enormously popular Seinfeld.
Castle Rock, maker of "A Few Good Men," is just one of two small Turner movie studios. And the other is New Line, which helped launch Jim Carrey to star status with "The Mask."
Castle Rock CEO Alan Horn welcomes the merger. "It helps us in that competitive environment to have the kind of money that will enable us to go out there and spend what's required to make our movies ... and to have the distribution capability on a worldwide basis to exploit the product most efficiently."
The hugely powerful Warner Brothers Studios has made almost $600 million this year with films like "Batman Forever" and "The Bridges of Madison County." These movies and many more blockbuster hits will naturally become part of Time Warner and Turner's extensive film libraries. The movies can be circulated among Turner networks such as TBS and TNT or Time Warner's fledgling W.B., HBO or Cinemax.
The Time Warner-Turner deal comes on the heels of other mega media mergers: Disney-Capital Cities/ABC, Westinghouse/CBS and Paramount/Viacom. Each of these deals has contributed to an escalating of the standards required to be in the business. In fact, it's going to be very difficult for smaller players to become profitable and remain important in the entertainment business.
The deal means that rivals will be thrown together on the same Hollywood sets and collecting the checks from the same mega-boss. And as those producers of "Friends" told us about the Time Warner- Turner deal ... "We wished we owned stock." Doesn't everyone?
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