In Business This Week: HEADLINER: RAPTOR
Can raptors save Acclaim Entertainment? Awash in inventory of poor-selling games, the Glen Cove (N.Y.) software maker lost $221 million in fiscal 1996 and $19 million in its first '97 quarter. But its Turok: Dinosaur Hunter, due Mar. 4, is winning raves from game mags, thanks to the vivid graphics of the Nintendo 64 system it runs on.
The good news is that the Nintendo 64 system is selling briskly, just beating sales of Sony Corp.'s PlayStation last Christmas. The downside: N64 games run on cartridges, not CD-ROMs, raising production costs. And cartridges need more lead time, so Acclaim could be stuck with unwanted inventory again.
That doesn't bother kids, who love offing the dinosaurs in Turok. "This is a very involving game," says James Granger, a ninth-grader in Manhattan, as he kills raptors. "Amazing weapons," he whispers, switching among assault rifles, grenade launchers, and a fusion cannon. His deftness is bad news for the raptors. But he's saying what Acclaim wants to hear.EDITED BY KELLEY HOLLAND By Neil GrossReturn to top
NEWS CORP. WISHES UPON ECHOSTAR
HERE HE COMES: RUPERT Murdoch is finally moving into the U.S. satellite-TV market. On Feb. 24, News Corp. unveiled a $1 billion investment in fast-growing but financially strapped EchoStar Communications in exchange for a 50% stake in the Englewood (Colo.) company. The move solves pressing problems for both outfits. Murdoch's American Sky Broadcasting venture is at least three years behind market leaders DirecTV, a unit of Hughes Electronics, and Primestar, a consortium of cable companies led by Tele-Communications. Fast-growing EchoStar, meanwhile, desperately needs cash after setting off a price war last year. Murdoch plans to launch Sky, a beefed-up state-of-the-art service offering 500 digital channels, including local stations, nationwide, by early 1998, and he vows that it will reach more than 8 million viewers within five years.EDITED BY KELLEY HOLLANDReturn to top
WERE CREDIT UNIONS TOO WELCOMING?
THE NATION'S CREDIT UNIONS are getting their day in court. The U.S. Supreme Court agreed on Feb. 24 to hear an appeal by North Carolina's AT&T Family Federal Credit Union on whether it and other credit unions improperly accepted members from unaffiliated companies or occupations. Legal experts say if the Supreme Court agrees with the appellate court that they did, it could force the bust-up of many of the nation's 2,000 largest credit unions, which have been enjoying explosive growth and which continue to operate tax-free. The court will hear arguments this fall, and an opinion could come in 1998.EDITED BY KELLEY HOLLANDReturn to top
LAUGHING ALL THE WAY TO CITIBANK
NICE RAISE IF YOU CAN GET it. In 1996, Citicorp Chairman and CEO John Reed topped off $3.5 million of salary and bonus with $40.1 million of paper profits from exercising options, the company's new proxy material reveals. That should make him one of the highest-paid corporate executives of 1996. In 1995, by contrast, Reed's salary and bonus totaled $4.3 million, and he exercised shares with a relatively paltry value of $3.8 million. The good times could get even better: Reed has additional options he can exercise at any time that are currently worth over $40 million.EDITED BY KELLEY HOLLANDReturn to top