Media Caught In Market Whirlwind
Like a TV reporter hanging on to a light pole during a hurricane, the media drew attention to itself Thursday as the Dow plunged 512 points. For some media companies, the nosedive was far greater than the overall setback. CBS Corp., which is the least diversified of all the major media companies and primarily depends on advertising for its sustenance, dropped 9.33 percent to $24.21. But other media companies also suffered big losses. Comcast, which controls NBC Universal, fell 4.37 percent; its partner GE, which now owns 49 percent of NBC Universal, fell 5.72 percent. The Walt Disney Co., which owns ABC-TV and ESPN, dropped 5.56 percent. News Corp, the owner of Fox, fell 6.70 percent. And U.S.-listed shares of Sony tumbled 6.53 percent. Viacom took the smallest hit -- 3.37 percent amid expectations of a strong second-quarter earnings report. That report materialized before the market opened today (Friday), and it was even stronger than expected. The company reported profits for the quarter of $574 million, up a whopping 32.8 percent over the same quarter a year ago. Revenue hit $3.77 billion, up 15 percent. Broadcast and cable outlets duly reported the market freefall, some of them presenting commercial-free special features. And while some commentators questioned whether the drop may have been fueled by the media attention, Dan Gross, economics editor at Yahoo! Finance, told the web portal's The Cutline blog that "a huge chunk" of market activity is driven by computers, "and the computers definitely aren't watching cable news." And while all of the news outlets were broadcasting the often conflicting opinions from experts about why the market behaved the way it did, Heidi Moore of Marketplace radio told The Cutline "Here's what none of those people will tell you ... they don't know."