A case of lost opportunities for AOL! Facebook; YouTube and maybe Tencent would be owned by different businesses today if AOL had stepped in to buy them in the years 2006 and 2004 respectively.
Jon Miller, ex-CEO of AOL has revealed yester year facts publicly for the first time in an exclusive interview with CNBC. Miller put the blame for a halt to further talks on the Time Warner Board.
The acquisition of Time Warner by AOL in 2000 was a much touted deal but it did no good to the growth of AOL. Time Warner rebounded and gained control of the merged company as the revenue numbers of AOL fell. Miller who served as the CEO of AOL for the period 2002-2006 never got support for acquiring internet companies which Time Warner felt were distracting them from their core strengths in cable networks and content creation.
Google went on to acquire YouTube in 2006 and made history. The $1.65 billion acquisition was valued at $160 billion previous year. Tencent is now valued at around $400 billion while market cap of Facebook is a $510 billion plus today.
Miller felt that acquisitions were necessary for being a forerunner in business but the visions held by him for growth and expansion were dampened by Time Warner Cable. It was a case of missed opportunities, he felt. The culture at AOL subsequently worsened and eventually this led to an AOL spin-out in 2009.
Tim Armstrong stepped in as the new CEO of the new spin out and got a taste of the toxic levels in the work culture at AOL. Immediate steps were taken by him to rectify the situation which involved knocking down his office walls and introducing a model of open floor seating. AOL was eventually sold by Armstrong to Verizon in 2015 for about $4.4 billion.