Et Tu Steve Case?

28 thoughts on “Et Tu Steve Case?”

  1. I think Case is right on the mark. You have hardly addressed the points in his article. Instead you rip into him personally because he engineered the merger. The comparrison to Apple is valid. A faltering brand with good people and strong potential. AOL could emerge as a leader on par with Yahoo. It has the audience base with both AIM and AOL. AOL is strong with families and young kids. These kids will very soon be teens and strong drivers of technology. AIM is already one of the most used technologies for teens and 20’s. A few right moves and AOL will be right back in the game

  2. I think you’re being a little hard on Steve, Om. I’m not saying he’s a candidate for sainthood, and much of what he did at AOL made things worse instead of better. But he didn’t manufacture the market value that allowed AOL to take over Time Warner, nor did he slip something into Gerald Levin’s coffee that made him or the board accept the deal. In a way, you seem to be arguing that the merger actually made sense (or is starting to). Why not give Steve some of the credit for that idea?

  3. Jake

    i think i addressed those issues pretty clearly – i think AOL is part of the whole TW turnaround. I don’t think it can become any better without Time Warner.

    The video assets of TW are showing up on AOL, increasing the value of the overall company. Even the roadrunner point case is trying to make has been addressed.

    the fact of the matter is the reason the merger did not work in the first place, it is because of the AOL folks. Secondly, the legal mess weighed down on the combined company.

    I think to break-up the giant now is driving with eyes only on the rear view mirror.

  4. Regardless of history, those who argue for break-up have a harder case to prove (sorry), as the synergy among assets at Time Warner has really not even begun to be exploited. (The same holds true for the other large media players that combine some set of print, video, and audio-based assets.)

    So break-up advocates must prove that synergy among these assets cannot effectively be developed and commercialized — because, once the break-up has occurred, the option value of capturing the synergy is pretty much gone (at least for the Time Warner shareholder).

    But, for example, I can point to a number of published patent applications my company has filed that disclose methods of adaptive publishing (applied to print, audio, or video) based on historical on-line usage behaviors that could be uniquely exploited by a media asset holder like Time Warner, and could thereby generate synergy for the shareholder. Given the general market is not likely to credit the individual pieces of TW with that synergy value vis-a-vis alternative business combinations, my guess is the Time Warner shareholder would once again lose if there were to be a substantial break-up . . .

  5. As a reporter you should know better than to call an opinion a “fact.” I disagree with your opinion about “the facts of the matter.”

    AOL didn’t sell TW anything. In fact it was TW that sold itself to AOL. That’s one of the few facts there are. the acquisition didn’t work because of lots of things. Anongst those are culture clash and in-fighting.

    Perhaps we can agree on one thing. The results are disappointing compared to the potential for great services that lots of consumes missed out on.

    Victor

  6. I’d expect MSFT and Time-Warner to confirm their partnership before mid-week, at least thats what all my sources indicate. I wonder if Google will take more than a $50 hit when/if this gets announced.

    As for the last couple of years, I think the the AOL team just got fat, rich, dump and happy thinking they had an exit strategy. The TW team really thought they were doing the right thing to avoid the Disney-Internet lack of strategy.

    Does anyone have a Google model that could estimate the loss of AOL as a distribution outlet? It probably equates to 1-2 quarters of Google’s growth.

    Ash

  7. Sure Case is a self-serving huckster, but nobody does it better and that’s why I like him. Om, you are right on the money that this is a repeat of the AT&T situation, but I think you are wrong to be anti-breakup. I was an AT&T employee back then and even though it was obvious to me that the 4-play was a great strategy, it was equally obvious that AT&T could never pull it off. The problem was the rotten core of old-school AT&T and TCI that were resisting change and slowing down overall growth (albeit while acting as cash cow). TW has the same problem — they are just not built for speed. Having the right strategy is not going to win the decathalon if you are old and out of shape. To see how things should be done, look to Sprint. Over the last decade they have done a great job of morphing the company into a streamlined cutter, poised to outmanouver the delapidated dreadnots of Comcast, Verizon, and at&t.

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