It's been a mixed start of the year for media stocks. Measured against the broad-based Standard & Poor's 500 index, which gained 3.7 percent in the first quarter, most media companies underperformed
in the first three months of the year, with the notable exceptions of Walt Disney Co. and Sony Corp, which both hit 52-week highs in the first quarter--with Disney's share price growing 16.5 percent.
What caused Disney and Sony's Q1 success? Investors want to see companies investing for the future, and the digital future looks bright for both companies. Disney's expanded deal with Apple for
digital delivery of its TV shows, its robust mobile phone content strategy centering around its ESPN and Disney brands, as well as a planned takeover of Pixar Animation Studios have kept the stock
moving forward. Sony had strong first quarter in software sales for its aging PlayStation 2, releasing several big name titles in the twilight of the console's life cycle, pleasing investors, who
anxiously await the on-schedule US launch of the PS3 in November. Other media stocks did not fare so well in Q1: Time Warner posted a 1 percent decline, and Viacom and CBS both posted Q1 declines,
post-split.
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