With a goal of making minority investments averaging between $5 million and $20 million, the fund will focus Time Warner's investment efforts through the Time Warner Digital Media unit established earlier this year, said Digital Media Chairman Richard Bressler.

Mr. Bressler said the investments would include opportunistic moves, aimed at making money for Time Warner shareholders, and would also focus on companies whose businesses fit with Time Warner's activities. Time Warner is one of the nation's largest operators of cable-television systems and cable-television networks, and a publisher of such magazines as Time, Life, People and Fortune. In addition to the Warner Bros. studio, it also owns record company Warner Music Group.

Creation of the new media fund follows Time Warner investments in a series of digital companies in the past year, such as OpenTV Corp., WebMD Inc. and Bolt Inc. Time Warner got a small stake in WebMD in exchange for promotional time on its media outlets but took a stake in OpenTV because the company is developing TV technology of interest to its TV businesses. Mr. Bressler said Time Warner had made more than $100 million on its initial $7 million to $8 million investment in OpenTV after the company went public several weeks ago.

Separately, Time Warner and search-engine company LookSmart Ltd. are expected to announce as early as Thursday that LookSmart will operate its search and directory services across Time Warner's Web sites, such as CNN.com, CNNfn.com, warnerbros.com, Entertaindom.com and EW.com. Those sites are connected to Time Warner traditional media properties such as Cable News Network, the Warner Bros. studio and Entertainment Weekly magazine.

The Time Warner deal is likely to be an important one for the San Francisco company, which competes with a wide range of portal players, including large companies like Yahoo! Inc., by expanding its distribution. Under the deal, the companies will share advertising revenue in the search and directory area, which will be sold by LookSmart.

"This is another brick in the wall of ubiquity we are trying to build," said LookSmart Chief Executive Evan Thornley, who is aiming to provide LookSmart search and directory services to as many "vertical" Web sites as possible. A vertical portal aims to focus on a particular niche, such as sports, finance or entertainment.

(The Asian Wall Street Journal)