Time Warner

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Template:Infobox Company

Time Warner Inc. Template:NYSE (AOL Time Warner Inc. between 2001 and 2003) is the world's largest media company with major Internet, publishing, film, telecommunications and television divisions. The company is officially headquartered in New York, New York, United States.

Contents

History

Time Warner was created in 1990 by the merger of Time Inc. and Warner Brothers Inc.. This company subsequently acquired Ted Turner's Turner Broadcasting System in 1996.

AOL Merger

In 2001, a new company called "AOL Time Warner" was created when AOL purchased Time Warner. The deal, announced in 2000, employed an unusual merger structure in which each original company merged into a newly created entity. The Federal Trade Commission approved the deal on January 11, 2001.

There has been some speculation about the motivations of each party. Some observers believed that Time Warner was struggling to integrate "new media" into its business. A merger with AOL provided a huge subscriber base of Internet users, along with online marketing know-how. Many business journalists have reported that AOL executives felt that AOL stock was severely overvalued and that a big merger was the only way to prevent a collapse in valuation.

The merger faced immediate opposition by consumer groups and other media companies on antitrust grounds.

Media companies felt that the vertically integrated AOL Time Warner would unfairly promote its own content within its outlets. This fear existed before the merger, but Time Warner was thought to be a conglomeration of very independent divisions. It was feared that this would change with the influence of AOL executives.

Consumer advocates were concerned with the threat of product tying between Time Warner's cable TV systems and AOL's Internet service. Some consumer groups saw a possible attempt to corner the Internet-over-TV market, whereby AOL could force all of the Time Warner cable subscribers to use AOL branded Internet-TV. Smaller internet service providers feared that AOL would tie its Internet service to Time Warner's cable modem service. Some ISPs wanted the opportunity to use Time Warner's cable network as a common carrier for their services, which competed with AOL. AOL and Time Warner pledged not to violate any antitrust regulations.

Many observers were shocked that a large, diversified media conglomerate was being acquired by a much smaller company. Market conditions at the time of the merger placed a greater premium on Internet-related stocks than on traditional media stocks. AOL's high market capitalization relative to that of Time Warner made the acquisition possible. The deal has since become a symbol of the Internet Bubble.

AOL CEO Steve Case became executive chairman of the new company, while Time Warner CEO Gerald Levin retained the CEO title.

Post-AOL Merger

After the merger, the profitabilty of the (America Online) ISP division decreased. Meanwhile, the market valuation of similar independent internet companies fell dramatically. As a result, the value of the America Online division dropped significantly. This forced a goodwill write down, causing AOL Time Warner to report a loss of 99 billion dollars in 2002--at the time, the largest loss ever reported by a company.

In response to the huge loss in 2002, the company dropped the "AOL" from its name, and removed Steve Case as executive chairman. Richard Parsons became the new CEO.

A number of transactions have since taken place:

Since 2003, the Time Warner text logo appears in CamelCase form (ala RadioShack).

Businesses

The following enterprises are part of Time Warner:

Time Warner also owns several other television channels and magazines, including CNN Headline News and Entertainment Weekly, as well as Time Life books and music. See external links below for a complete list.

Financials

Time Warner's market capitalization is US$84 billion (2004). When the AOL-Time Warner merger was announced in January 2000, the combined market capitalization was $280 billion.

For fiscal year 2002 the company made a $99 billion income statement loss ([1] (http://finance.yahoo.com/q/is?s=TWX&annual)) because of $100 billion in non-recurring charges.

Commercial Properties

Time Warner Inc. owns several large properties in New York City; certain buildings in the Rockefeller Center complex and adjacent office towers house its main offices; one of which houses a CNN news studio. In late 2003, Time Warner finished construction of a new twin-tower complex, designed to serve as additional office space, facing Columbus Circle on the southwestern edge of Central Park. Originally called the AOL Time Warner Center, the 755-foot, 55-floor mixed-use property was renamed Time Warner Center when the company itself was renamed.

Board of Directors

As of March 2004.

See also

External links

de:Time Warner es:AOL-Time Warner fr:Time Warner ja:タイム・ワーナー nl:Time Warner no:Time Warner pt:Time Warner zh:时代华纳

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