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Technology Stocks : USA/Lycos -- Ignore unavailable to you. Want to Upgrade?

To: Sam Citron who wrote (11)	2/10/1999 12:49:00 PM
From: Joe Griffin	Respond to of 47

Is NBC the Final Piece Of the Lycos-USA Puzzle? 7.56 a.m. ET (1256 GMT) February 10, 1999 By Jon Elsen NEW YORK — USA Network boss Barry Diller's acquisition of hot Internet "portal" Lycos Tuesday makes a deal with NBC more logical than ever. Jack Welch, head of NBC parent General Electric, has been doing everything in his power to solve a fundamental problem at his broadcast network: viewers are turning away to cable and the Internet. Swimming against the tide, Welch and his NBC chief, Bob Wright, have been buying and building cable networks, and aggressively investing in the Internet. They talked to Diller about a merger last year, but never quite got there. Now Diller has gone out and bulked up on Lycos — a hot Internet portal that NBC reportedly wanted for itself. So maybe it's time to revisit the USA-NBC talks. By merging the two companies, Welch would solve another big problem he has — NBC can't go out and make big acquisitions without diluting that sacrosanct GE stock. A separate NBC-USA company would trade on cash flow, like other media companies, and would likely get a big boost from its strong presence on the Internet. The new company would use its high-flying stock to make more acquisitions, and invest even more aggressively in the Internet. It would own Lycos and Ticketmaster-CitySearch, and hold investments in Snap, Cnet, and iVillage. They would have cable networks, CNBC, MSNBC, USA Network. And, of course, they would have the NBC broadcast network. But sources close to Diller say he's less interested in acquiring NBC than ever. As one explained, USA thought acquiring NBC might make USA a presence in one fell swoop. But after just a few years, USA is already worth some $15 billion. Diller says he doesn't need more deals. "We do not need to go outside for a single other thing to pursue the agenda that we've got," he said. "However, we're young and ambitious, and opportunistic."