Well a crazy woman and a neurotic man
Should never, ever, ever make a wedding plan…

– “Maybe Just Maybe,” Bruce Roper

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The Saturday after the AOL-Time Warner merger was announced in January, 2000, I appeared at an Internet conference at the Kellogg Graduate School of Management.  I got a really swell gym bag out of the deal, but first an audience member asked what I thought of the deal, as part of a Q-and-A.  

I frankly don’t remember what the panel was about, but I do remember my answer to the question: I quoted the first two lines from the Sons of the Never Wrong’s “Maybe Just Maybe,” reproduced above.

After the tittering subsided, I said that, after nearly a decade of working with AOL at the Tribune and half a decade of running the Chicago Tribune’s web sites, I didn’t see a business model that made the price remotely make sense.  I was back on the “print side” just then, having emerged alive but 50 pounds heavier after 4 years as Chicago Tribune director of interactive media, but it wasn’t where I was sitting that made me say that.  It was the uncertainty that hung over every minute – and every decision, whether minute or not – related to the Internet those days.

“Because the deal does not carry a set price for Time Warner shares, investors who choose to hold the stock for the long haul must not only believe in the Internet as a place to shop and gather information, but also as a profitable business,” the New York Times wrote on the morning after the deal was announced.  

The math said that the merged company would have a capitalization of $350 billion. Today, TWX closed at $21.83, which works out to $26 billion.  And today I am thinking about this because of another Times piece, Time Warner Expects to Spin Off AOL:  “Time Warner is inching closer to an untangling of what many consider one of the worst mergers in American corporate history by shedding America Online,” it begins.

N0w, I’m no genius. I didn’t make any money on the Internet bust, though I kind of expected there would be one.  I was hoping that media companies would leverage their transitory moment of strength while the Web world regrouped.  I was thinking that Time Warner was putting itself in position not to participate in this incipient Indian summer, and I was OK with that.  And I was remembering some of the AOL people with whom I had, shall we say, philosophical disagreements.

The substance of those disagreements?  They tended to talk about deals, stock prices, liquidity events, and leverage.  I tended to talk about users, journalism, community service, and utility.  “You know the trouble with you newspaper guys?”  one of them snarled at a few of us in a meeting one day.  “The way you think, you’ll never be millionaires.”

Fast forward to today, and  the last quote in today’s Times, from Time Warner CEO Jeff Bewkes: “We know that most M&A in the media sectory has not created value.”

Indeed.  We are too soon old and too late smart.  Can we get back to talking about the audience now?  It won’t get us out of the current bust overnight, but it ought to create a sustainable future.