By Simon Constable
In January 2000, Steve Case, CEO of internet provider AOL, agreed to merge with media conglomerate Time Warner for a record-breaking $156 billion offer for a public company.
At the time, The Wall Street Journal noted that the 15-year-old AOL wasn’t old enough to purchase beer.
On the other hand, Time was founded in 1923 and survived the Great Depression with many well-loved brands. “[AOL] has essentially swallowed an ancien regime media conglomerate that took most of a century to construct,” wrote The Wall Street Journal.
“This was supposed to be the proving ground of Old Economy meets New Economy,” says Pete Earle, a senior research fellow at the American Institute for Economic Research. AOL needed content, Time Warner had lots of it, and there would be synergies. “It seemed like a match made beyond heaven,” says Earle.
But that dream died fast.
A big part of the issue was the culture clash. “You have Time Warner, a conservative long-lived company added to AOL, an aggressive tech firm,” Earle says. “It hindered effective collaboration.”
In retrospect, the deal’s announcement in January 2000 marked the peak of the dot-com bubble.
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