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Time Warner explores Net IPO initiative

Time Warner is getting more serious about taking its Internet assets public, and CNN is playing a major role in the process, according to sources close to the company

Time Warner is getting more serious about taking its Internet assets public, and CNN is playing a major role in the process, according to sources close to the company.

In recent weeks a team of CNN executives, including vice chairman Steve Korn, have approached some investment banks for advice about a possible public offering of Time Warner holdings, including CNN, sources said. "They are very serious about it," one source said.

One Time Warner executive said the media giant is weighing possibilities that include issuing a tracking stock for its Internet assets or an outright spin-off of its Internet holdings.

Time Warner and CNN declined comment.

The discussions with investment bankers come as Time Warner is bolstering its Internet management ranks--another sign that the media giant is more serious about this plan. Just yesterday, Time Warner named Richard Bressler as chief executive of Time Warner Digital Media to oversee its Internet ventures and the company's investment in Road Runner, a high-speed Net access provider.

Time Warner also named Michael Pepe as president and chief operating officer of the unit. Pepe formerly was the head of e-commerce at the company.

The executive appointments and discussions with investment bankers are the latest steps in Time Warner's ever-shifting Web strategy. Now that the company has shuttered Pathfinder, its initial Web foray, Time Warner is looking toward creating a series of "vertical hubs" focusing on news, finance, sports, entertainment, and lifestyle.

The hubs will integrate a wide array of content from Time Warner's magazine publications and Web sites. For example, CNNfn will head the finance hub and will feature content from Fortune and Money; and Warner Bros. Online's Entertaindom will run the entertainment hub and have control over Entertainment Weekly's content.

While other media companies such as Disney and NBC have taken stakes in Web companies to beef up their Internet strategy, Time Warner largely has gone it alone. Company executives say Time Warner had been in advanced discussions to acquire Web portal Lycos but backed down because of its inflated market valuation.

CNN Interactive and its CNNfn financial Web site are some of Time Warner's leading Internet properties. They also have the benefit of cross marketing through their respective television programs.

"CNN is really the marquee property of the Time Warner brand," said Patrick Keane, an analyst at Jupiter Communications. "When looking at a Web business, the leading metric is traffic, and CNN has a pretty compelling traffic story."

CNN Web sites are undergoing changes of their own. Two CNNfn vice presidents, Craig Forman and Helen Whelan, are resigning to start an e-commerce site called MyPrimetime, a spokeswoman said. CNN might strike an alliance with the start-up, she added.

The two executives' departures come in the wake of last week's resignation by Lou Dobbs as head of CNNfn. The spokeswoman said the departures were unrelated.