AOL Returns to the Green, Green Grass of Home

Time Warner confirmed yesterday that it will spin off AOL as a stand-alone public company at the end of the year. So endeth one of the more notable chapters in the history of the Internet, so far.

What can be said about this AOL/Time Warner experiment? Well, it didn't work. Could it have worked? Perhaps, but it was sabotaged by arrogance and mistrust on both sides from the beginning. Ambitious combinations such as AOL and Time Warner don't always fail because the strategic concepts are ill-conceived; they fail because of jealous rivalries and pedestrian concerns at the grassroots -- essentially, turf wars. In that regard, I am very interested to see the scything motion that Tim Armstrong has been using since assuming control of AOL. It may imply that he recognizes the first order of business is to cut-out the entrenched positions that have been holding-up the successful integration of AOL acquisitions and, hence, its business. It could also mean that he's layering in Google's entrenched positions, which will make for a very complex business environment at AOL, indeed.

But, could AOL and Time Warner have ever worked as a combo if human entanglements had not confounded it? Recall that at the time the merger took place AOL was still largely a gated content community. In that respect, AOL looked more like Time Warner than it does today. All its life, in fact, AOL -- along with most other early Internet players -- had probably dreamed of growing-up to be just like Time Warner, though digital. AOL saw in Time Warner all of its ambitions as a child. Time Warner, in return, saw in AOL its legacy and someone to care for it in old age. As media faithful, AOL and Time Warner shared a similar creed when they merged in 2000 and 2001.

If faith in the established media order of the time were to have been rewarded then, yes, perhaps AOL Time Warner might have succeeded in overcoming the usual obstacles of smashing businesses together and, today, represent the standard that currently belongs to Google. But faith in old media models -- gated communities -- has not been rewarded, at least to the extent that those models should prevail over others.

AOL, ironically, had nothing to teach Time Warner at the time they merged. It wanted too much to be Time Warner (and no one inside that organization was going to let it). It's different, today, and AOL probably has very much it could teach Time Warner; but the listening stopped long ago.

It is a good thing for both sides that this experiment has, thus, come to an end, and it may be a good thing for the media world generally to have AOL back grazing on the digital side of the fence, a somewhat older and wiser, senior member of the herd. The grass is green enough on our side of the fence and, ultimately, as the song goes, there is no place like the green, green grass of home.

Comments

[Bongborg]

Portal. LOL. Directed ads. LOL. Ugly GUI. AOL sucks and always has. LOL.

[vippy]

I love AOL and their chatrooms. No one else has same!

[KillTheMessenger]

Like I said... being on AOL was an insult.. and it looks like absolutely nothing has changed about that.

:-)

[desktop]

Both these companies have failing business models. The days of huge profits from media service, electronic or otherwise are dead for ever. Nobody needs either one of them.

[OtayPanky]

The most notable thing about AOL is that it pretty much sank Time-Warner.

Some folks say it was Gerry Levin's single bad decision..­.but boy oh boy...it was a doozy.

[OneTop]

At the time of the merger it was all about the flavor of the month -- convergence, and all the espoused commercial benefits thereof.

The lawyers and those at the top of both predecessor corporations reaped in obscene amounts of money as result of the transaction. And, as they say, the rest is history.

AOL is being spun off, as after an exhaustive search their are no interested buyers.

I suppose we will see it and it's still relatively easy to find some underwriters to take it Sucker .... er... I mean Public.

[Nitehawk]

I just hop AOL doesn't resume its practice of mailing a thousand discs per month to my home.

[KillTheMessenger]

As far as I know "AOL" was always an insult on the internet. Did that ever change?

[larry278]

Time-Warners spin off of AOL could speed the demise of AOL. As a radio commentor said, "Ah, there is good news tonight.". After Time Warner completes its spin off of AOL, it may try to relaunch the formerly mass media, photo magazine, Life again. This will be Time-Warner's 29th attempt to relaunch Life. All of the attempts have failed. Time-Warner may, again. say the Time-Life is in charge of relaunching Life.

[RuthlessDictator]

"Life" is a relic of the mid-20th century. It may exist as an internet-only magazine but not as a print media.