• Online Media Daily, Friday, March 13, 2009 12 PM

In an exclusive interview with MediaPost's Online Media Daily, newly fired former AOL CEO Randy Falco insists he's accomplished what was asked of him in his time in charge of the Time Warner company. Among other things, Falco eliminated $2.5 billion in cost, including this week's 10% work force cut, and made 16 strategic acquisitions worth $1.6 billion (Bebo alone cost half that) during his two-and-a-half year tenure. Falco claims that he was already contemplating leaving the Web giant when Time Warner CEO Jeff Bewkes abruptly replaced him with Tim Armstrong, Google's former SVP of sales, on Thursday.

"I have been reorganizing and restructuring AOL, changing the strategy and rebuilding it from scratch in the worst economy in a generation," Falco told MediaPost's Diane Mermigas in an interview conducted prior to his replacement. "My job was to turn the company around, and to give Time Warner a profitable Web business to spin off and a profitable access business that still throws off a tremendous amount of cash. I can check both of those boxes. I am done, and I feel good about what we've accomplished."

Falco also points out that the Web business was losing "hundreds of millions of dollars" before he arrived, and it now makes money. "The margin has gone from negative 20% to plus 20% in two years. The access business margin has gone from 43% to 80%. We eliminated 50 content products on the way to creating more than 100 micro sites under the new umbrella of MediaGlow while growing the audience for the key verticals more than 30%." Despite these accomplishments, Falco notes, "No matter what we accomplish here, all the press and analysts can think about is how AOL's merger with Time Warner in 2001 was the worst in history."

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