Time Warner has folwed up its results with news it is separating AOL's dial-up internet access service from its faster-growing online advertising business. The move could presage a sale or further realignment of both businesses.
Jeff Bewkes, Time Warner's chief executive, called the split “one of our top priorities”, adding: “This should significantly increase AOL's strategic options for each of these businesses.”
Bewkes also said he hoped to resolve the future of Time Warner Cable, its largest source of revenues, by mid-April, although his intentions remained unclear.Time Warner has repeatedly expressed a desire to spin off or separate its 84 per cent stake in the business, but analysts and investors believed it could also take advantage of cable's low valuations to consolidate its control.
Bewkes announced an immediate $50 million in cost cuts for the corporate office, and said further reductions would follow across the company. One target is New Line Cinema, Time Warner's independent film label, which he suggested could be merged with the larger Warner Brothers studio.