As predicted, Time Warner is attempting to divest itself of the AOL nightmare. After writing down AOL’s entire pre-deal capitalization, thus effectively declaring the unit that purchased the Old Media company worthless, the latest steps have been to drop the brand and the stock ticker symbol.
Don’t get me wrong — it’s not that AOL is worthless… but it is clear that it was never worth 75 billion dollars. Steve Case build AOL into a 75 billion dollar parasite and, as the internet bubble ventured well beyond irrationality, he searched for a host onto which to attach that parasite. Now, as the Steve Case love potion wears off, Time Warner realized the disease and is masking the symptoms. Time Warner should have bought AOL for $50 Million. That’s it.
-Ian.