Saturday, May 30, 2009

Time Warner To Sell Its AOL's shares

You have probably heard about this story the last couple of days. News corp Time Warner is about to sell its shares of AOL. When the merge occured in the early 2000s a lot of hope has been placed in the creation of this new business. Experts were considering that the gathering of the news corporation super power combined to the leader of the brand new Internet economy will turn into a new giant which will dominate the web.

Couple of years later we can see that it is definitely not the case. The newspapers market has been traumatized and is still struggling to a adapt to the Internet. Internet now counts for 20% of all media consumed in the US, and Time Warner has still to change its organization and philosophy about its business model.

But what is even more interesting is that AOL, which was a trailblazer on the web, did not manage to follow the web 2.0 trend. If some 1.0 companies like Meetic in Europe are thriving, news-based companies are struggling, like AOL or Yahoo!. French 1.0 Lycos, which was the leading home page site in France, has shut down couple of months ago

That shows how great the 2.0 shift has been. AOL, which became big fast, hasn't been able to remain a fast mover enough to embrace the 2.0 trend, to stay competitive, and to make the adjustments required to the blogging and social media hypes.