Date: Tuesday, January 11, 2000 9:16 AM
From: J. Duncan (J)
Subject: Mega-Merger Mania
I believe that AOL and Time Warner deciding to merge ("AOL, Time Warner to Merge ," 10.Jan.2000) is just one step taken to catch up to AT&T's progress. The 'Father Bell' has snapped up major media companies like TCI and lately Media One, which gives it access to about 60 percent of American households with cable. A few years ago, I believe there was a deal between AT&T and Time Warner (before the recent acquisition binge) to co-market in each other's prospective hunting grounds. I'm not aware of the status of that deal, so I'm just wondering to all the people who so vehemently oppose this merger: Where were you when AT&T had been buying/partnering and merging with all the pieces of its puzzle? They appear as a Goliath, not necessarily overwhelming in any one market, but so saturated in all the phases of it that the 'one company, one bill' scheme makes perfect sense. When AOL purchases Time Warner, Steve Case is merely trying to create a way for his company to meet subscriber demands and secure a route for broadband access. Open for everyone is a goal to strive for, but when it comes down to it, AOL has promised customer satisfaction and is trying to deliver on it....
Granted, the combined company will be large, but don't let the numbers fool you into thinking it's larger than it is. In most of the articles I've seen, it mentions how AOL enjoys the "lofty valuations of an Internet company," yet uses these same 'lofty valuations' of the company's stock price to determine which earns the tag of MegaMerger. In terms of business, it's a perfect fit. The two companies complement each other beautifully and anything that saves money for the company, eventually does get passed down to the consumer/stockholder.
