Newspaper article St Louis Post-Dispatch (MO)

Networks Have a Strong Place in the Future

Newspaper article St Louis Post-Dispatch (MO)

Networks Have a Strong Place in the Future

Article excerpt

So you fully comprehend the likely long-term outcome of the twists, turns and deals in a technology and communications revolution that's headed toward 500 cable channels?

Congratulations. You now qualify as a member of the Liars' Club.

With names such as Bell Atlantic, Tele-Communications, Liberty Media, QVC Network and Paramount Communications jangling in their heads, perplexed experts also are trying to make sense of the future. Stocks of many firms have gone sky-high despite less-than-clear prospects.

Some perspective is offered by investment firm T. Rowe Price, which has started the New Age Media Fund, a closed-end fund traded as a stock on the New York Stock Exchange. It's building a portfolio of logical best bets in this revolution.

In wireless, where many stock prices have gotten out of hand, the fund is buying Vodaphone Group, a British cellular company. It also sees strong prospects for Pacific Telesis to spin off its wireless division.

Regional Bell companies have been revived by the concept of phone lines delivering cable signals, so the fund is buying shares of Pacific Telesis, U.S. West and Bell Atlantic. Because pictures will be needed by interactive computers and networks, it's also buying shares of Playboy Enterprises and Enquirer/Star Group.

Meanwhile, the $200 million Fidelity Select Broadcast & Media Fund, up 39 percent this year, holds shares of Walt Disney Co. because timeless programming will be in greater demand.

And both of the Price and Fidelity funds include a stock group once considered a technological dinosaur: the traditional broadcast networks.

CBS Inc. and Capital Cities/ABC (NBC is a relatively small portion of giant General Electric) recently have run up dramatically in price. It doesn't look like the run-up is over.

Investors have stopped fretting over the the networks' loss of 40 percent of their prime-time market share to cable. …

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