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USA Networks looks to buy
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December 6, 1999: 5:25 p.m. ET
Diller on prowl for cable, local TV stations; Seagram Co. looks to boost stock
By Staff Writer Tom Johnson
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NEW YORK (CNNfn) - USA Networks Inc. Chairman Barry Diller returned to the public pulpit with an ambitious growth plan Monday, saying his company would expand both its cable and local television holdings within the first half of next year.
Diller, who has made few public speaking appearances since Lycos and USA Networks called off a proposed $20 billion merger in May, told audience members at the PaineWebber Media Conference that despite some reports, his company will be a buyer and not a seller of broadcast television assets during the next year.
"I would doubt that we are a seller in broadcast,” Diller said at the McGraw-Hill Building in New York City. "It’s my whole history. So why not build it?”
Accordingly, USA Networks (USAI) plans to acquire or launch at least one new cable channel and develop new local broadcast stations, possibly as soon as the first quarter of next year.
Diller also said his company remains in discussions with all the major broadcast companies about ways to take advantage of new government rules allowing duopolies, or the ownership of two television stations in one market.
"The only people we’re no longer in conversations with is CBS,” Diller said, noting the ultimate deal may end being more of a joint partnership than an outright duopoly.
Diller and USA Networks President and Chief Operating Officer Barry Baker spent much of their presentation touting the growth of the company’s online and direct selling operations.
Diller vowed to keep pumping capital into the company’s Ticketmaster Online-Citysearch Inc. operation, which allows customers to do everything from buy concert tickets to mine regional entertainment information.
Ticketmaster Online is now the Internet’s number three Web retailer with roughly 360,000 buys per month, and Baker predicted much of the growth next year could come from the Home Shopping Network, which will expand into several new international markets, and the Hotel Reservation Network, which the company plans to spin-off.
Meanwhile, the chief of USA Networks’ largest shareholder, The Seagram Co., followed up Diller’s speech with a bullish outlook of his own.
Stating he was "not particularly happy” with Seagram’s current stock price, President and Chief Executive Officer Edgar Bronfman Jr. told conference attendees his company was entering the testing phase for its new secure digital music downloading software - an industry he projected would generate sales of $100 billion by 2010.
In addition, Bronfman said Seagram was well ahead of its goal of achieving $300 million in additional cost savings by 2001.
But despite pressure from some shareholders, Bronfman said he had no plans to spin off the company’s wine and spirits division, which he believes is too valuable because of its strong cash flow.
Seagram (VO) finished up 1-3/8 to 45-3/8 Monday while USA Networks inched up 1/4 to 42-3/8. 
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