RSSTime Warner to shed cable business, struggles continue
By Ed Oswald | Published April 30, 2008, 11:21 AM
In a move that may have serious implications on the possibility of a future AOL + Yahoo pairing, Time Warner said Wednesday that it will be spinning off its cable division.
Time Warner owns about 84 percent of the cable provider, and its CEO said in a statement that a "complete structural separation" will be in the best interest of its shareholders.
It is not immediately clear how the spin-off will be handled, or how much of a stake in the new company Time Warner will retain. However, it said a deal was being worked out, and something will be announced "soon."
News of the split comes as the company continues to struggle. First quarter net income fell 36 percent to $771 million. Profits at its AOL division plummeted 73 percent as revenues shrunk from its ISP business.
When Time Warner first announced AOL was exiting the ISP business, it promised the division would make up for lost revenues through ad sales. That hasn't happened: it reported only a one percent increase in ad sales for the period.
Shareholders have begun to press for results, and CEO Jeff Bewkes seems to be responding to those calls. It may not be the last Time Warner division to be tossed aside either: rumors about that AOL is being offered to Yahoo.
Time Warner may also be interested in selling AOL as soon as possible with a Microsoft-Yahoo deal possibly on the horizon. If that goes through, the list of possible suitors would shrink, say industry insiders.
Why did time warner buy AOL anyway? I am wondering who sits behind the table and makes these decisions.
If you can buy another company to join forces and expand or make something better or stronger than fine, do it. Don't buy a company just for the sake of it. I haven't seen one good thing AOL has done since the takeover. Or did they just buy AOL to drive it into the ground to drive up the ISP price of their own service? I dont know either way, AT&T has been at a price war with TW. so they should have known that was coming making it still a bad decision.
Its a waste of your time, money and stockholders money.
thank you.
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AOL hasn't done anything good since the world wide web became available to the general public.
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Time Warner needs to only do films..They don't seem to have a good track record with things outside the core biz..
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We use their ISP division (fiber with TWTelecom) and it is probably the best ISP I have ever used. 0 seconds of downtime since we started with them in 4 years.
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rumors about that AOL is being offered to Yahoo.
Rumors abound, perhaps?
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Yes.it would be nice if BN could write at least one article that didn't rely on rumors but then I wouldn't have something to b**** about:(
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