| Names dropping
New York, Sept. 19 (Reuters): The board of AOL Time Warner voted on Thursday to remove AOL from its name, a final post script to the internet bubble and a sign of the failure of the company’s attempt to unite old and new media.
The company was formed in 2001 when America Online, the leading internet company, purchased Time Warner, owner of Time magazine, CNN, and Warner Bros., and promised to transform the media industry.
But, just months after the $112-billion deal, the technology bubble burst, the value of the AOL online division plunged and it became a drag on the whole company.
Meanwhile, khaki-clad new media prophets from America Online clashed with executives from the more traditional businesses, and the company failed to deliver the promised integration.
The company said the change will be completed in the next few weeks, when its stock will trade under Time Warner’s old ‘TWX’ symbol on the New York Stock Exchange, instead of ‘AOL’.
The symbolic unraveling began in January, when Steve Case, the founder and co-architect of the deal, resigned as chairman of the company. Case remains on the board of directors.
While the latest move has few tangible implications for its business, analysts greeted it as a step toward erasing the memory of the merger.
“The name reminds people of a mistake,” said Hal Vogel of Vogel Capital Management. “AOL is now being recognised as a division and not a leading part of the company.”
Vogel, who has watched the media industry converge and diverge since the sixties, is cautiously optimistic. The company has got long-term problems, he said. “But the terrible bleeding has stopped.”
It has managed a collection of box office hits, including the Matrix franchise, HBO’s Sex and the City and The Sopranos, which have swept Emmy Award nominations.
Even AOL has made progress by launching a critically acclaimed update to its software. And the hoped-for synergies, in the form of stories from the magazine division appearing exclusively on America Online, are beginning to emerge.