Dick Parson's, CEO of Time Warner, said that focusing on AOL was his number one priority and that he was considering "structural and strategic options" to achieve it.
He seems to disagree with Mr Icahn's view (Mr Icahn has amassed enough ownership of Time Warner to merit a view) that the best way to increase Time Warner's value is to increase share buy-backs and to spin off all of Time Warner's cable business.
Parsons believes that the source of undervaluation is neither of these, but is the lack of performance at AOL. He therefore plans to accelerate the changes at AOL to morph the company to become both a serious free, ad based global portal as well as an ISP, presumably able to better compete in the ruthless broadband world (hence hanging on to Time Warner Cable).
Step number one is to separate out AOL's two businesses: one focused on being an ISP and the other an ad based portal to compete with Yahoo and Google.
Step 2 seems to be to improve AOL's portal's search service and maybe replace a partnership with Google with one with MSN and to make AOL more successful internationally.
Good luck Mr Parson's and move fast. Yahoo and Google have one hell of a head start.
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