ONES TO WATCH in ’94 : Companies, People and Trends that May Transform the World of Money in the Year Ahead

In the obvious corners and down some unlikely paths, The Times’ Business staff has found the companies, people and trends that will make a difference in 1994.

THAT’S ENTERTAINMENT

Look for a financial restructuring of ailing Euro Disney, Walt Disney Co.’s albatross near Paris. The most likely scenario would be creditors swapping some debt for equity, but Disney could make another cash transfer to the disappointing theme park. . . . Corporate egos and potentially enormous profits are on the line as Warner Bros. and Paramount Communications race to launch a fifth broadcast TV network next year. The quest is to sign up the few still-independent TV stations available for affiliation. One thing the rival companies can agree on: There can be only one “fifth” network. . . . Bill Mechanic, architect of Walt Disney Co.’s successful home video division, broke records mass-marketing hits such as “Beauty and the Beast” and “Aladdin.” Now he’s second-in-command at 20th Century Fox, where he’ll need some fairy dust to help him work magic for that erratic studio. . . . Rupert Murdoch emissary Sam Chisholm is sure to make waves when he arrives on the Fox lot in West Los Angeles to oversee overseas television operations for Murdoch. Chisholm, who runs British Sky Broadcasting, of which News Corp. owns 50%, was described as a “take-no-hostage” negotiator when he represented Murdoch for his recent investment in Star TV, the Asian satellite service. . . .

PEOPLE WITH SOMETHING TO PROVE

Will David Dworkin, chief executive at Carter Hawley Hale Stores, reverse the fortunes of the operator of the Broadway department store chain? Keep an eye on Broadway’s ambitious remodeling program. . . . Enough is enough, says Jack Smith, president and chief executive of General Motors Corp. After losing about $18 billion from GM’s North American auto operations over the last three years, the new CEO put his credibility on the line in November by vowing to turn a profit in 1994. . . . Erskine Bowles, the new administrator of the Small Business Administration, has promised to reorganize that beleaguered federal agency. . . .

THAT’S ENTERTAINMENT II

Raymond Smith became the most powerful unknown in television when he bought Tele-Communications Inc. from previous unknown John Malone. Smith’s probable next step: an alliance with a Hollywood studio. . . . Tom Murphy, once chief executive of Capital Cities/ABC Inc., will again take the reigns of that media giant when Dan Burke steps down in February. Now that federal regulations against networks owning the TV shows they air have virtually been lifted, CapCities/ABC is looking to become a major program supplier. . . . Washington antitrust lawyer Reed E. Hundt seemed an unlikely candidate to take over the Federal Communications Commission amid the telecommunications revolution, but the former senior partner at Latham & Watkins has friends in high places: President Clinton was a Yale Law School classmate and Vice President Al Gore is a prep school chum . . . .

BANKING ON CALIFORNIA

Glendale Federal Bank, the nation’s fifth-largest S&L;, narrowly avoided government seizure last year. Now, all Chairman Stephen Trafton has to do is get the thrift to start making money. . . . Mario Antoci, chairman of American Savings Bank in Irvine, won kudos from the White House for making mortgage loans to low-income and minority people. Antoci said he is determined to prove that lenders can make a buck--as well as a political statement. . . . Expect Edward M. Carson, chairman of First Interstate Bancorp, to continue his buying binge in 1994. First Interstate acquired five banks in 1993, adding 80 branches to the 325 it had throughout the state at the beginning of the year . . . .

ALONG THE SUPERHIGHWAY

If 1993 was the year it became hip to have an Internet address, 1994 may be the year this maze of interconnected computer networks becomes usable for the average non-computer geek. Rupert Murdoch’s recent purchase of Delphi, the largest provider of Internet addresses, may hasten things along. Continental Cablevision has pledged to provide Internet access to its customers in 1994, and other cable firms are expected to follow suit. . . . It’s the unknown little multimedia firms--based mostly in the Silicon Valley and Los Angeles--from which much of the year’s interactive innovation is likely to come. Among those to watch: Los Angeles-based Knowledge Adventure, and Activision; Medford, Ore.-based Trilobyte and Silicon Valley-based Rocket Science, PF Magic, Brilliant Media, Digital Pictures and Pop Rocket. . . . Publicity-shy billionaire Paul Allen, Microsoft’s other founder, is poised to become a major player in the burgeoning multimedia industry. He has invested in Lone Wolf, a Redondo Beach multimedia networking company, and bought control of Ticketmaster, the world’s largest computerized ticket broker. Allen has talked of taking control of the fast-growing computer service America Online and invested $100 million in Interval Research. Now, rumors are swirling that he is planning his own interactive TV channel with Ticketmaster. Will this be the year Allen emerges from the shadow of Harvard classmate and Microsoft Chairman Bill Gates? . . .

OTHER GAMING NEWS

The Las Vegas casino-building boom could increase the pressure on cash-strapped California to loosen restrictions on gambling. . . . R. D. Hubbard, who runs Hollywood Park Inc., is scheduled to open a card club at the venerable racetrack in February--but will the poker tables draw gamblers away from the track’s betting windows? . . .

ABOUT TELECOMMUNICATIONS. . . .

Comcast Corp., the nation’s No. 4 cable TV company, will be one of the most sought-after merger partners of the new year. The Philadelphia-based company has significant holdings in cellular radio and has shrewdly joined forces with Barry Diller in QVC Network’s bid for Paramount. Though the family-controlled firm has shown no interest in an outright sale, it is looking for a partner at the telecom ball. . . . Don’t leave that couch: Two “direct-broadcast satellite” services will go on the air this year, each an alternative to cable TV. Hughes Communications will launch DirecTv, offering subscribers 150 channels. And Minneapolis-based Hubbard Broadcasting will launch United States Satellite Broadcasting, initially with a 20-channel package. All that’s needed to receive the satellite signals is an 18-inch satellite dish and a set-top converter box like those found in many cable households. The price? About $700--but that’s expected to drop quickly and dramatically . . . .

LOCATION, LOCATION, LOCATION!

The mortgage refinancing tidal wave that has washed over the nation for the last two years is losing force. Although mortgage interest is expected to stay in the range of 7% to 7 1/2% this year, most homeowners who could benefit from the low rates already have done so. That’s especially bad news for mortgage bankers, who’ve grabbed the lion’s share of the re-fi activity from conventional banks and S&Ls.; . . . The glut of new public offerings last year for real estate investment trusts, coupled with the recent rise of interest rates, has sent some REIT shares plunging and forced several companies to postpone new offerings. Los Angeles-based Macerich Co. and Arcadia-based Santa Anita Realty are among those hoping for an improved outlook before launching IPOs. . . . Builders will closely watch sales at the high-density residential subdivision under construction by RecreActions Group of Cos. in the master-planned Orange County community of Rancho Santa Margarita. The Newport Beach developer is jamming as many as 15 single-family houses onto each acre--two to three times the usual average. A 900-square-foot, two-bedroom, 2 1/2-bath detached house with two-car garage will sell for $128,000--a price Orange County buyers haven’t seen in more than a decade.

KEEP YOUR EYE ON. . . .

Willy Theisen is a middle-aged guy with slicked-back hair, an earring--and millions of dollars. Theisen, who made a mint selling his Godfather’s Pizza chain, now controls Green Burrito, a Mexican-food chain based in Anaheim. If Theisen has his way, you might soon be buying his burritos at Carl’s Jr. fast-food restaurants. . . . Jesus Gomez has spent much of his working life installing drywall in housing tracts. In 1992, he orchestrated an immigrant workers’ strike for the right to organize. Astonishingly, the drywallers beat the powerful building industry. Organizing efforts will continue in 1994; under their contract, members’ wages can rise if more companies are unionized. . . . David Tsai, a Taiwan-born import-export businessman, decided it was time to capitalize on Los Angeles’ position as a bridge between the booming economies of the Pacific Rim and the awakening potential of Latin America. His answer? The $10-million Asian Pacific Mart, a former antique autos showroom at 11th and Flower streets in Los Angeles. Tsai, 46, plans to build a 216-room business hotel next door. . . .

WHY ASK WHY? DIVERSIFY!

Where in the world are you? Ask Magellan Systems, the small San Dimas company that produces hand-held position location devices using the Pentagon’s global positioning system. Magellan has deals with three Japanese auto companies to supply in-car navigation systems and is selling a $500 model to help hikers, hunters and fishermen navigate the wilderness. About a third of Magellan’s 150 employees are veterans of the defense industry. . . . As Southern California’s military industry keeps shrinking, John M. Deutch will have lots to say about which programs survive. The Defense Department’s chief purchasing manager will be weighing pleas from Lockheed Corp. and Hughes Aircraft Co., who want the Pentagon to buy their early-warning satellite system. So far, the DOD is sticking with its plan to purchase a $1.3-billion system from TRW Inc., which builds its satellites in Redondo Beach. . . . Despite a slump in the environmental engineering business, Long Beach-based Earth Technology Corp. is growing under the stewardship of CEO Diane C. Creel. The company, which once identified missile launching sites for the Defense Department, now is cleaning up closed military bases. . . .

NOT TO MENTION. . . .

How tough are times at Apple Computer Inc.? A topic of debate at a recent personal computer conference was, “Can Apple Survive?” . . . The World Cup international soccer championships in Pasadena next summer will give Southern California tourism officials a chance to repair the region’s image. . . . The insurance agent may be the next endangered species. Clinton Administration health-care reformers consider agents and their commissions a prime source of the unnecessary costs to be squeezed out of the system. Life insurance agents are under intense scrutiny for the claims they make about their policies. In California, pay-at-the-pump auto insurance--the subject of a voter initiative campaign--would threaten some 80,000 property-casualty agents with obsolescence. . . . Contributing to this story were Times staff writers James Bates, Jill Bettner, Nancy Rivera Brooks, James Flanigan, Amy Harmon, Kathryn Harris, Bruce Horovitz, John Lippman, Thomas Mulligan, David Myers, David Olmos, Michael Parrish, James Peltz, Jonathan Peterson, Tom Petruno, Jesus Sanchez, Karl Schoenberger and George White in Los Angeles; Greg Johnson in Orange County; Donald Woutat in Sacramento; Chris Kraul in San Diego; Martha Groves in San Francisco; Donald Nauss in Detroit; Juanita Darling in Mexico City; Jonathan Weber in New York; Leslie Helm in Seattle; David Holley in Tokyo, and Jube Shiver Jr. and Ralph Vartabedian in Washington, D.C.