Viacom Rises, Sun Dips
MTV benefits from the Hollywood writers
NEWS AT A GLANCE
Viacom profits rise, aided by writers’ strike
Media heavyweight Viacom reported a 33 percent rise in quarterly profit, to $270 million, beating analysts’ estimates. Revenue rose 15 percent. (AP in Yahoo! Finance) Ad revenue at Viacom’s cable TV business rose along with ratings at its MTV and Nickelodeon networks, and the success of the video game “Rock Band” helped its bottom line, too. (Reuters) Cable networks especially benefited from the 100-day writers’ strike at the broadcast networks, said UBS analyst Michael Morris. “Cable is the main story with Viacom, and the first quarter wasn’t any different.” (Bloomberg)
Sun posts surprise loss
Software and server company Sun Microsystems reported a quarterly loss of $34 million, surprising investors, who were expecting a profit. Sun also said it is cutting up to 2,500 jobs to counter the “significant challenges” posed by the weak U.S. economy. Its shares fell almost 15 percent in extended trading. (AP in Yahoo! Finance) Sun said weakness in U.S. sales, as companies held off on upgrading equipment, canceled gains in Asia and Europe. It forecast flat sales this quarter. (MarketWatch) “It is becoming more uncertain whether the company can meaningfully grow its revenues over the long term,” said analyst Bill Kreher at Edward Jones & Co. (Bloomberg)
Microsoft takeover hits Google bump
Yahoo! could announce within a week that Google will manage at least a portion of its online advertising, according to The Wall Street Journal, which could complicate Microsoft’s takeover plan. (MarketWatch) The Journal also reported that Microsoft CEO Steve Ballmer was leaning toward staging a hostile proxy fight for Yahoo!, instead of raising his bid or walking away. “We ought to announce something in relatively short order,” Ballmer told employees at a company meeting. (AP in Yahoo! Finance) “Not getting this done is putting a substantial amount of pressure on him,” said Rob Enderle, at research firm Enderle Group, of Ballmer. (Bloomberg)
Italy moves to shame tax cheats
In a measure designed to combat Italy’s rampant tax evasion, outgoing Prime Minister Romano Prodi’s government posted online the tax returns of all 40 million Italians who paid in 2005. The site was flooded by people curious about what their neighbors and their celebrities paid, and the site was closed down after a few hours. According to those who saw the page, fashion designer Giorgio Armani paid the most taxes, $29 million on $68 million in income. Some people were outraged by the rare exercise in transparency. “It’s madness,” said comedian Beppe Grillo, seriously. “It will be much safer and less risky to just evade taxes and pay the fine if you’re caught.” (International Herald Tribune)
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