As an Activision Blizzard (NASDAQ: ATVI) shareholder, I'm extremely gratified by the unqualified success of the Guitar Hero franchise. However, I'm none too happy about statements made by Warner Music Group (NYSE: WMG) CEO Edgar Bronfman Jr. who believes that Activision Blizzard should be paying more to license the songs. When I first heard about that, I admit, I became a bit worried. After all, if the publisher has to pony up a higher amount of cash to the music industry, then there could be pressure on the stock.

Well, I'm glad I caught a blog post by Eliot Van Buskirk for Wired over at Portfolio.com. Looks like Activision Blizzard CEO Robert Kotick isn't taking too kindly to those in the music industry who suggest his company needs to share a higher percentage of the spoils. He basically told Bronfman Jr. to chill out, suggesting that the impact of his software platform on music sales for artists that are contained within it almost argues that the publisher shouldn't pay a dime to the music industry.

The shareholder in me says "right on, Bob!" In this digital age, the music industry needs all the help it can get in promoting its artist roster. Gone are the days when consumers opened their wallets for physical CDs. That aspect of the music industry is dying in favor of the iTunes model that powers Apple (NASDAQ: AAPL) and its iPod empire. Therefore, I agree with Buskirk's assertion that the boat shouldn't be rocked here. Music companies should just accept the licensing structure as it exists, look at it as a loss leader if they feel that's what it is, and just be satisfied with the ancillary promotion they receive.

Warner Music Group (NYSE: WMG) reported third-quarter earnings numbers on Thursday (for more earnings news, see here). Revenues increased a scant 5% to $848 million. The bottom line saw a net loss of 6 cents per share. According to Earnings.com, analysts were expecting a loss of 18 cents per share. So, expectations were soundly beat.

But should investors be completely enamored of the performance? There were some interesting growth rates sprinkled throughout the release. Indeed, digital revenues increased over 39%, and operating income from continuing operations jumped almost 11%. Free cash flow, as defined by the company (management adds back net cash paid or received for investments excluding short-term investments) soared 63% during the quarter, coming in at $93 million. However, during the nine-month period, free cash flow declined 47% to $37 million. Furthermore, net cash from operations decreased 1% and 6% for the third quarter and nine-month period, respectively.

In my opinion, investors should not be completely enamored of the performance. I see a mixed-bag here. I'd need to see some better long-term growth rates in the cash flow, and healthier top-line appreciation, to become intrigued. Warner Music obviously wants to leverage digital revenues as much as possible and adjust to the new landscape that the music business finds itself currently navigating. Interestingly enough, CEO Edgar Bronfman, Jr. is a bit angry at Activision Blizzard's (NASDAQ: ATVI) Guitar Hero and Viacom's (NYSE: VIA) Rock Band music-gaming systems. According to this article, the CEO thinks that the song-licensing fees for the games are too low. This, of course, shows just how popular and significant music-gaming has become.

Billboard reported Wednesday that Warner Music Group (NYSE: WMG) suffered a $16 million loss during the first fiscal quarter of this year, which ended on December 31, 2007. This is the result of shutting down a concert promotion company, and the loss also contrasts with the $18 million income the company enjoyed in the same period a year ago.

Despite this loss, the music giant still managed to increase domestic sales up 10.5% in the face of album sales dropping 14.6%, and international sales also increased by 2.7%. The company told Billboard that the growth was due to labels Warner Bros. Records and Atlantic Records "capturing the No. 1 and No.2 rankings in U.S. market share and to a strong showing in digital revenue." According to the same piece, the revenue from digital sales was 14% of all revenue, but still not a significant increase over past figures.

Professional blond Paris Hilton has got some deep-pocketed fans in corporate America, including Comcast Corp. (NASDAQ: CMCSA), Warner Music Group Corp. (NYSE: WMG) and Time Warner Inc. (NYSE: TWX), who are hoping that she can pay her debt to society pretty quickly.

Hilton, who was released from jail this morning because of a medical condition, has shrewdly cashed in on her notoriety. She deserves a gold medal for parlaying her 15 minutes of fame into a show-business career. She's responsible for many awful trends including the growth in popularity of small toy-sized dogs and celebrity sex tapes. Her economic impact is undeniable.

Though she's confined to her home for the next 40 days, expect to see quite a bit more of the ditzy heiress America loves to hate.

Comcast's E! cable network is the newest home to The Simple Life. In the latest season of the show that refuses to die, Hilton and her sometimes BFF (best friend forever), Nicole Richie, are camp counselors who, among other things, motivate a group of overweight children to live healthier. No word if binging and purging will be covered.

For reasons best known to CEO Edgar Bronfman, Warner Music is putting out Hilton's album Paris, which is on sale for $19.98. Time Warner's TMZ.com site and other entertainment sites can count on millions of people hitting their pages for the latest gossip on Hliton. By the way, TMZ is reporting that Hilton's problem is emotional, not physical.

I neglected to mention her contribution to literature. Speculation was rampant that Hilton was planning a book about her prison experience, which I guess now is out the window since she didn't actually spend much time in the slammer. Hilton, though, is pretty resourceful and will no doubt pen a sequel to Confessions of an Heiress once she recovers from her ordeal.

Remember that corporate America profits handsomely from pop culture fads, even bad ones.