Under pressure from Carl Icahn and others to unlock share value, Time Warner Chairman and CEO Dick Parsons used Wednesday’s appearance to stress the importance of AOL to the entire company — and to make the case for keeping it. “What we’re not likely to do, having carried this what some people thought was a burden we should have offloaded three years ago to this point in time” is unload iit. (The webcast replay is here.) Saying he wouldn’t discuss recent press reports about AOL and Microsoft “or about anybody else,” Parsons still managed to address many of the issues raised like AOL’s lack of a major search engine.
Unleashing AOL: “We need to accelerate a path that we’ve been on but now we need to move with even greater speed and urgency and that is moving AOL from the business model where it was solely or largely dependent upon subscription revenue … to more of an audience-based business. We’re not going to move away from the access business because it generates, frankly, too much money but we need to focus on building the audience for the advertising-based side of the business.” He reminded attendees that AOL is already one of only four companies doing $1 billion or more in online ad revenues. “But we need to be more aggressive, we need to penetrate that area more effectively. That’s where our focus is.”
The Street: Parsons thinks one key to unlocking value is separating AOL’s revenues into two distinct pieces “so that the Street can look at them discretely. … We think we can pick up some of the value (Google, Yahoo) are getting in the marketplace if we make it clear that same dynamic is happening with AOL.”
Search gap: “We’re missing one thing — in the universe of how you monetize eyeballs on the web you have display ads, you have click-thrus based on orders รข
Subscriber content
?
Subscriber content comes from Gigaom Research, bridging the gap between breaking news and long-tail research. Visit any of our reports to learn more and subscribe.
Advertisement
Advertisement
Advertisement
Comments have been disabled for this post