T. Rowe's Gensler Smells Cash in Telecom

There has been a great deal of action in the media sector this year with Howard Stern's secession from Viacom(VIA Quote) to Sirius Satellite(SIRI Quote), Liberty Media's (L Quote) stake in News Corp. (NWS Quote), and even the Ovitz trial over at Disney (DIS Quote). But where is the group headed?

In media there is always a lot going on -- that might be a permanent condition. The biggest change now is with regard to the role of technology. Technology was a friend to the media industry for many years by enabling companies to extend their reach. Satellite, DVDs and the Internet were new forms of distribution for media companies.

But now many of the new media companies are rising up to challenge the older, established companies. Howard Stern's move to satellite radio is a good example. He's not going alone -- Mel Karmazin is also making the jump from traditional media to satellite.

Speaking of technology companies, why do you have eBay(EBAY Quote) in your portfolio? Is that a media company?

We have an admittedly loose definition for media. For example, we won't own online brokers like E*Trade(ET Quote) or Ameritrade(AMTD Quote). And you could easily say that eBay is a retailer. But they have some media company qualities about it if you stretch the definition far enough. You go to advertising-sponsored Web sites like Yahoo! (YHOO Quote), eBay and even Google (GOOG Quote) in lieu of watching TV or listening to the radio. But I will admit to you it is a gray area.

Another gray area seems to be gaming stocks. International Game Technology (IGT Quote) is your second-largest holding, plus you have a decent-sized stake in Multimedia Games (MGAM Quote). Is watching the video poker screen the same as watching a TV screen?

We lump together media and entertainment in a few instances, that's true. But we won't own a hotel company like Mandalay Resorts(MBG Quote), which we view as outside our mandate. And IGT may be a slot machine manufacturer, but they are also in the content creation and entertainment businesses, just like your traditional media companies.

We have a widely defined charter to pick stocks and we prefer it that way. We would rather keep our options open than be boxed into owning a stock we did not like simply because it was in our space.