TIME WARNER FALLS 34 PERCENT

Time Warner has become the latest media conglomerate to report a steep slump in second-quarter profits. In its latest regulatory filing, the company said that it earned $519 million in its latest quarter, down 34 percent from the $792 million it reported in the comparable quarter a year ago. However, last year's figures also included earnings from its profitable Time Warner Cable, which was recently spun off. Excluding the cable results, earnings were down 8 percent. Although Time Warner is one of the few major media conglomerates that does not own a broadcast network, its cable networks, which reported a whopping 17-percent increase in operating income, outshone the performance of broadcast rivals' including CBS Inc., NBC Universal, Disney/ABC, and Fox Broadcasting. Analysts noted that Time Warner was able to offset lower advertising revenue for its Turner Broadcasting outlets by collecting more money from cable outlets (including Time Warner cable, the nation's second-largest cable company behind Comcast). Another solid performer was its Warner Bros. movie unit, which rose 52 percent due mostly to restructuring. Its weakest component continued to be AOL, which not only lost advertisers but subscribers as well as its revenue dropped 24 percent.

ACTRESS SAYS SHE DIDN'T OPT OUT OF TWILIGHT ROLE

Rachelle Lefevre has denied Summit Entertainment's claim that she had opted out of returning to the Twilight movie series as the vampire Victoria because of "scheduling conflicts." Summit said on Tuesday that Lefevre was being replaced by Bryce Dallas Howard, who co-starred in Spider-Man 3 and Terminator Salvation. In a lengthy statement on Wednesday, Lefevre said that she had been "fully committed" to the Twilight series and claimed that her only other commitment involved the drama Barney's Version, which involved only a ten-day shoot. "I turned down several other film opportunities and, in accordance with my contractual rights, accepted only roles that would involve very short shooting schedules," she said. Summit has not responded.

BLU-RAY MAY BE COMING INTO ITS OWN

After accounting for only a small sliver of home video sales since it won the high-definition video war with HD DVD, Blu-ray Disc is finally beginning to show some real clout in the video store. Home Media magazineobserves that 36 percent of total unit sales of Watchmen, which debuted at the top of the sales and rental charts last week, could be attributed to Blu-ray Disc sales. The trade publication observed that the results demonstrate that "the format is fast moving out of the early adopter phase and into the mainstream." The stop-action animated film Coraline finished in second place with 18 percent of its sales coming from Blu-ray. The 3D film is packaged with four sets of 3D glasses.

HAS THE PIRATE BAY DEAL COME UNDONE?

Fulfilling numerous predictions voiced on blogs focusing on file sharing and the BitTorrent community, reports were rampant Wednesday that the deal for Global Gaming Factory of Sweden to acquire The Pirate Bay was, as the website TorrentFreak put it, "dead in the water." The source for the most recent spate of negative comments about the deal is Wayne Rosso, former CEO of Grokster who recently joined GGF, then suddenly quit, telling TorrentFreak, "We're not going to risk our reputation further." He said that funding necessary to close the deal was not going to materialized given the lack of workable plans for The Pirate Bay. PC World magazine was one of several publications that issued I-told-you-so editorial comments, saying that the deal always had "seemed far-fetched."

NEW MOVIE TO STAR "THE LORAX"

Another Dr. Seuss character is coming to the screen -- this one in 3D. With family films increasingly showing big profits in theaters and in home-video sales, Universal has made a deal with the estate of Theodore "Dr. Seuss" Giesel to turn his environmental fable The Lorax into a feature. Universal, which announced plans for the new deal, also indicated that The Lorax will be featured at its Universal Studios theme parks. Seuss's book has sparked controversy in the past with its warnings about spoiling the environment. A group in one California town once demanded that it be removed from a school library because it treated the timber industry unfairly.

Cinemark Movie Club