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Point, Click, Delete? AOL Time Warner May Drop 'AOL' From Corporate Name

August 12, 2003|Jeff Leeds | Times Staff Writer

You've got baggage!

AOL Time Warner Inc. is considering deleting "AOL" from its corporate name to distance its struggling AOL online service from a merger widely viewed as one of the worst in business history, sources said Monday.

Jonathan Miller, who became chief executive of the America Online unit last year, is pushing for the switch so that AOL might preserve its own, separate identity as an Internet dial-up and broadband service.

"I believe it's time for us to get our brand back," Miller said in an e-mail to employees Monday.

"The three letters 'AOL' have ceased to stand for the Internet and the promise it entails," the e-mail said, "and instead have become the shorthand for the world's largest media company."

Dumping "AOL" would be a signal that executives recognize the merger of America Online and Time Warner Inc. hasn't exactly turned out as planned.

Warner brass has kicked around the name change idea before, with some contending that the larger media giant was being dragged down by the online unit's poor performance and shrinking subscriber base.

Miller's argument is that it is the online unit that is suffering by being so visibly tied to a huge corporation under federal investigation -- although the Securities and Exchange Commission's probe into possible accounting fraud is heavily focused on claims that the America Online unit improperly inflated advertising revenue.

Chairman Richard Parsons could seek a board vote next month, sources said. Miller's initiative was first reported on the Wall Street Journal's Web site.

Corporate branding experts were skeptical that the corporation's accounting issues would make much of a difference to potential online customers, who the unit sorely needs to attract.

Internet users, lured by faster connections, are quitting America Online's $23.90-a-month dial-up business.

In the second quarter, the unit lost a surprisingly high 846,000 dial-up subscribers, leaving it with 25.3 million.

Analysts said the unit had been expecting the subscriber base to shrink by about 500,000.

If AOL Time Warner should become plain old Time Warner, would the unit's -- or the conglomerate's -- problems be solved?

Probably not, said Scott Lerman of the brand consulting firm Enterprise IG, who added that there are larger issues for the corporation, which also owns the Warner Music Group and Warner Bros. film studio.

Consumers "want an understanding of what the company really stands for," he said. "I have yet to see a coherent, cogent vision."

However executives decide to handle the name issue, he said, "They need to show leadership by deciding what the direction is.

Newsday was used in compiling this report.

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