Magazine Clearance at Time-Warner?

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At a recent seminar on the future makeover of media conglomerates, the managing director of Time Warner, Inc.'s largest shareholder foresaw Time Warner jettisoning its magazine unit and shoring up its entertainment holdings.

Speaking at a program entitled "The Art of the Long View: The Media Company of 2020, sponsored by the Annenberg School for Communication at the Univ. of Southern California, Gordon Crawford of the Capital Group, which owns 7 or 8 percent of Time Warner's stock according to various media accounts, anticipates Time Warner will divest itself of its print unit, just as it has spun off its cable division and dumped America Online (AOL).

Time, Inc.'s stable of 23 magazines published in the U.S. include Sports Illustrated, People and Time. The media giant has not been spared the recession-induced misery enshrouding the print media, as mass layoffs last year trimmed 6 percent of its employees. Second quarter revenues for the magazine unit declined 22 percent because of a 26 percent drop in advertising resvenues.

Time, Inc., is the nation's largest publisher of periodicals. Time Warner has not responded to Crawford's speculation.

Royalties Payoff Promotes Hollywood Hobbits

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Family members of fantasy author J.R.R. Tolkien and HarperCollins have settled their royalties lawsuit with Time Warner, which gives the green light to MGM and Warner Bros. to proceed with filmed versions of "The Hobbit."

New Line Cinema, which Time Warner acquired in March 2008, was sued by the late author's relatives, who control the charitable Tolkien Trust, for $220 million in February 2008. The Tolkiens, who granted the rights to New Line to make the "Lord of the Rings" film trilogy, alleged they were entitled to 7.5 percent of the gross receipts of the films, which tallied an estimated  combined $6 billion gross in box office, merchandise, DVD and TV licensing, but received only $62,500 from New Line. The case was scheduled for trial in October.

Peter Jackson, director of the "Lord of the Rings" trilogy: "The Fellowship of the Ring"(2001),  "The Two Towers" (2002) and "The Return of the King" (2003), and trilogy producer Saul Zaentz each settled similar lawsuits with New Line for approximately $20 million each after condemning New Line's "tookish" conduct.

Jackson is the executive producer, and Guillermo del Toro is slated to direct film versions of Tolkien's "The Hobbit," the first of which is scheduled for release in December 2011. Tolkien's fantasy/children's novel originally was published in 1937.