AOL Time Warner was hit with two key resignations in two days.
AOL Time Warner announced yesterday that Steve Case is out as chairman of the company following the shareholders’ meeting in May, but will remain as a director of the company with joint responsibility for corporate strategy.
Today, Walter Isaacson, the man charged with lifting CNN’s lagging ratings, gave his notice. AOL Time Warner is CNN’s parent company.
Case, the architect of the troubled mega-merger of America Online and Time Warner, said his role as chairman had become a “distraction” for the world’s largest media company in the face of disappointment with its post-merger performance.
The embattled executive said under a new leadership team AOL Time Warner could focus on executing the company’s various strategies.
“Given this progress and the fact that we’re moving into more of an execution phase, this seems like an appropriate time for me to announce that I will step aside,” Case said.
The shakeup comes just about three years after the mega-merger – now generally regarded as one of the worst in corporate history.
AOL Time Warner’s value has plummeted from $350 billion when the deal was announced to $63 billion today as the merged company failed to deliver on a vision of wedding old and new media. Now, investors are bracing for a write-off of at least $10 billion to reflect the continuing decline of its lumbering Internet division, America Online.
“I think it’s a diminishing prospect,” Liberty Media chief John Malone, one of AOL Time Warner’s largest investors, told CNBC.
Viacom’s Sumner Redstone told CNBC he passed on an offer six months before Time Warner bit. “I’d be crying now if I did that deal,” Redstone gloats.
Don’t feel too sorry for Steve Case, say observers. He reportedly made $160 million from his AOL Time Warner stock sales.
Meanwhile, Isaacson told his colleagues at CNN in a letter today he will be leaving at the end of the spring to take a position as president and chief executive officer of the Aspen Institute.
“This opportunity was unexpected and unsolicited, and the timing is not perfect, but it is exactly the type of job I have long wanted, so I did not feel I could let it pass,” he wrote. “As those who know me realize, the job is a perfect match because it offers the chance to do things I truly love or want to do: writing, exploring ideas, engaging in policy issues and seeking solutions to social and international problems.”
The Aspen Institute, headquartered in Washington, has campuses in Aspen and on Maryland’s eastern shore, and there are partner Aspen Institutes in France, Italy, Germany and Japan. For more than 50 years, since its seminar programs were launched by Mortimer Adler, it has run educational programs for leaders, young and old, which explore a wide range of ideas and attempt to apply timeless values to timely problems. It also conducts policy studies and research programs on international affairs, globalization, national security, the media, the environment, education and other topics.
“CNN has accomplished two major things in the past couple of years,” wrote Isaacson. “It has kept faithful to its core mission of being the most authoritative and credible source of information in the world, emphasizing hard journalistic reporting more than opinion shows. That is what makes CNN unique. In addition, CNN US has been transformed from being largely rolling news to featuring a lineup of signature, top-quality programs with this journalistic mission at their core, spanning the day from ‘American Morning’ with Paula Zahn to ‘NewsNight’ with Aaron Brown.”
Isaacson, who spent 24 years at the cable news network, said “CNN is in great shape.”
