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What The AT&T Merger Can Learn From AOL-Time Warner

Writing in today's Wall Street Journal is Steve Case, the former CEO of AOL and a person who knows about mergers with Time Warner -- he merged with cable giant 16 years ago. Case discusses the pitfalls of the ill-fated merger where the "synergy seemed clear: Time Warner would assure AOL’s path to broadband, and AOL’s internet presence would help Time Warner embrace the digital future. Long before people were streaming movies on their smartphones, we saw the potential for convergence. But our vision was ahead of its time, and the combination was hobbled by internal disagreements." Here's what Case cites as the main mistakes of the tie-up: "Having the right idea isn't enough," "Culture is more than a buzzword,"  and "A 'one' company strategy is key." One that last point, Case wrote: "When the AOL-Time Warner merger was announced, there was much enthusiasm about using our combined assets and talents to innovate. But because each firm became an independent subsidiary of a new holding company, with each pushed to maximize near-term profits, there was little synergy or collaboration." Words of caution...



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