Time Warner Eyes Internet Spinoff

Media giant Time Warner Inc. is reportedly considering spinning off its Internet properties as it aims to become a dominant player in that space.

In published reports, Jim Moloshok, president of Warner Brothers Online and chief executive of its recently-launched Entertaindom Internet venture, said a spinoff is among the options that could be considered. One of the challenges that lie ahead, Moloshok said, is coming up with a way to attract and retain employees and acquire programming.

With the exception of its CNN and CNNfn units, Time Warner (TWX) has generally used its online sites as promotional tools and used money from marketing budgets to fund their operations. That all changed recently with the launch of Entertaindom, a separate Web site that will focus on entertainment. Plans also call for new sites to be launched focusing on personal finance, sports and news.

Like most sites, Entertaindom will draw most of its revenue from advertising. However, it faces an increasing amount of competition. Yahoo! (YHOO) and other portals that began primarily as search engines have steadily added content in an effort to lengthen the amount of time visitors spend at their sites. In addition to competition from pure Internet plays, it will also go head-to-head with Go.com, an umbrella of Walt Disney Co.’s (DIS) Internet properties.

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