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AOL Time Warner completes split | AOL Time Warner completes split |
(about 2 hours later) | |
AOL and Time Warner have formally split after almost 10 years as one company. | AOL and Time Warner have formally split after almost 10 years as one company. |
Under the terms of the deal, qualifying shareholders will receive one AOL share for each 11 Time Warner they own. | Under the terms of the deal, qualifying shareholders will receive one AOL share for each 11 Time Warner they own. |
AOL shares will begin trading on Thursday. They will even regain the market ticker symbol they used before the merger. | AOL shares will begin trading on Thursday. They will even regain the market ticker symbol they used before the merger. |
But the company will be worth a tiny fraction of what it once was. Its market value is put at about $2.5bn - 10% of its value at the firm's height. | But the company will be worth a tiny fraction of what it once was. Its market value is put at about $2.5bn - 10% of its value at the firm's height. |
Media stars | Media stars |
At the time of the merger in 2001, the marriage of Time Warner with AOL was dubbed the "deal of the century" - one that brought superstars of both old and new media together. | At the time of the merger in 2001, the marriage of Time Warner with AOL was dubbed the "deal of the century" - one that brought superstars of both old and new media together. |
But the new media element, AOL, soon started to look jaded as its once-popular dial-up internet model was superseded by broadband. | But the new media element, AOL, soon started to look jaded as its once-popular dial-up internet model was superseded by broadband. |
Time Warner's long-established collection of TV and magazines proved no bulwark against new developments. It also lost revenue as the media fragmented further. | Time Warner's long-established collection of TV and magazines proved no bulwark against new developments. It also lost revenue as the media fragmented further. |
Dial-up die-hards | Dial-up die-hards |
It took place during the biggest bubble the stock market had ever experienced, and it marked the final triumph of the internet over the old media. Rory Cellan-Jones Read more from Rory Cellan-Jones on the split | |
Despite a few bright spots in its portfolio of sites, such as tech blog Engadget, AOL has a long way to go until internet advertising can replace the revenue it still gets from selling dial-up internet access. | Despite a few bright spots in its portfolio of sites, such as tech blog Engadget, AOL has a long way to go until internet advertising can replace the revenue it still gets from selling dial-up internet access. |
This type of customer is thin on the ground these days. In 2002, AOL had 26 million dial-up customers, now it has 5.4 million. However, it still earns 43% of its revenue from these die-hard subscribers. | This type of customer is thin on the ground these days. In 2002, AOL had 26 million dial-up customers, now it has 5.4 million. However, it still earns 43% of its revenue from these die-hard subscribers. |
On Thursday, investors will get their chance to rate AOL's prospects when the shares start live trading. | On Thursday, investors will get their chance to rate AOL's prospects when the shares start live trading. |
The occasion will be marked by AOL's chief executive, Tim Armstrong, who will ring the opening bell at the New York Stock Exchange. | The occasion will be marked by AOL's chief executive, Tim Armstrong, who will ring the opening bell at the New York Stock Exchange. |
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