The head of the world's largest media group, Time Warner chairman Richard Parsons, says bigger is better in the world of entertainment. Mr. Parsons says the media giant is well positioned in an international digital market.

The Time Warner chairman admits there are skeptics who see small specialized companies as the more efficient than conglomerates. One is Carl Icahn, a dissident shareholder who, according to news reports, would like to see Time Warner split into several companies.

Many others have urged the media giant to sell off its troubled Internet division, America Online. That will not happen, says Mr. Parsons, because AOL brings in earnings of nearly two billion dollars a year. He says he is pursuing potential partners, however, to get more of AOL's revenue from advertising, and less from its base of user subscriptions. He says the trend in his industry is toward growth and diversity, and today a handful of corporate giants control 80 percent of the media activity in the United States.

"There are those who have now said things have gotten too big; these things are now too unwieldy; they can't be managed. They're not nimble, they're not agile; we have to start going in the other direction," said Mr. Parsons. "I don't think that people who follow that advice are going to be rewarded over time."

The Time Warner CEO told a Los Angeles civic group that the globalization of entertainment calls for substantial size and financial resources. He says communication technologies are converging with entertainment, which helps large, diversified companies like his. Time Warner operates Warner Brothers studios, as well as television channels, cable systems, and publishing houses. The company has also entered the telephone business, and has more than one million telephone customers.

Mr. Parsons says entertainment products are the largest U.S. export, and the Internet allows specialized marketing of media products, such as old television shows, which Time Warner now sells through America Online. He says digital technology also presents challenges, especially piracy, which he says is rampant in China. One billion DVDs are sold there every year.

"A billion. About 50 million are legitimate," he added. "The other 950 million, or 95 percent of that, is pirated."

He says India is only slightly better. Sixty-five percent of the DVDs there are pirated. The executive says figures for Indonesia are similar. But he predicts the numbers will come down as authorities in those countries take a more active role in enforcing copyright laws.

The executive says no one knows where the media and entertainment business will go in the future, and projections made a few years ago were wrong. But he says a diversified company that is active in many sectors is well positioned to grow, no matter how the new digital markets develop.