By: Lucia Moses Tribune, Scripps, And Belo All Wary
After taking a hit when the value of their stakes in fledgling online ventures
dropped last year, newspaper companies say they'll cut back on such equity
investments this year.
The Tribune Co., which took a $75-million charge in the fourth quarter, will
invest less than originally planned this year, said Andrew Oleszczuk, president
of Tribune Ventures, which has a portfolio worth more than $1 billion.
The E.W. Scripps Co. also said it will spend with restraint. "We still think
it's a smart thing to do, and we'll continue to make investments prudently,
given the realities of this environment," spokesman Tim Stautberg said. Scripps
has gained $70 million on its $92-million investment since initiating its
portfolio in 1996.
Taking a more conservative approach was The Dallas Morning News' parent
Belo, which took a 16-cent charge against earnings in the fourth quarter due to
a decline in the value of its Internet investments. Belo won't invest in any
more Internet ventures until it's satisfied its existing ones will pay off,
Chairman, President, and CEO Robert Decherd told analysts and investors at a
meeting in New York in December.
Tribune Venture's Oleszczuk, Scripps' Stautberg, and Belo's Decherd all stressed
that they're not out of the game, however. "We've cut back a fair amount,"
Oleszczuk said. "But long-term, the Internet's going to fundamentally affect the
media business. We would not be doing our job for shareholders if we had a knee-
jerk reaction and got out."
Merrill Lynch publishing analyst Lauren Rich Fine said such investments weren't
a waste of money, despite the losses. "My feeling is, those [investments]
weren't made for short-term gains," she said. "It's still important in terms of
the strategic value they gained."
Lucia Moses (lmoses@editorandpublisher.com) is an associate editor covering business for E&P.
Copyright 2001, Editor & Publisher.
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