As the story of the AOL-Time Warner merger broke in New York Monday morning, a lot of people surfed between NY1, CNN and CNNfn to find more details -- all stations owned by Time Warner. (MSNBC, in what could be an ill portent of its news savvy, stubbornly stuck with Don Imus.) When CNN broke away from the newly christened AOL Time Warner's news conference, the anchor was calling it "the biggest merger ever" and seemed to be biting his tongue to keep from saying, "and we're part of it!"
But what was the feeling over in the editorial halls of Time's magazines? After all, Time Warner was the first of the "old media" companies to take a serious stab at colonizing the Web with its unsuccessful (and largely mismanaged) supersite, Pathfinder. One of its most respected veterans, Don Logan, had famously declared the Internet "a black hole." Now the most dominant force in that hole was essentially buying a majority interest in Time Warner. Was there a sense of loss, of failure among the company's old-school journalists?
"Everyone has their calculators on their desks," said one People staffer I talked with, alluding to the surge in TW's stock price that morning. Employees at the company are famously well-remunerated with many of the perks coming in the form of stock. Everyone gets a 401K, for example, and after a year the company provides matching funds in stock. And executives, especially those with seniority, have stock options as well. "The joke was that this was the first time people have come in on a Monday morning with a big smile on their face."
"Everybody who's vested is too busy lighting cigars and tipping hookers to comment," said an editor at Sports Illustrated. (He was kidding, of course. Smoking is strictly prohibited there.)
Those who agreed to speak on the record were more measured in their praise of the deal and its implications for TW. "Everybody I've spoken to is absolutely thrilled by this," said Josh Quittner, technology columnist for Time magazine. "I've been searching for a downside over here and have yet to find one."
As a veteran of both the Internet and Time Warner, Quittner is uniquely qualified to talk about the company's history with the Web and what sort of closure a merger with AOL brings. Since the mid-'90s and the launch of Pathfinder (where Quittner's Netly News channel debuted) there has been talk of Time buying an ISP or even becoming one -- and AOL was one of its early partners. But as Ted Turner noted in Monday's press conference, "It's not so easy to go out and re-create an AOL," and Quittner (who also edits the Time Digital supplement) points to the company's merging with CNN as a milestone in Time's cultural history.
"When CNN and Turner joined the Time Warner family it was also the thing that was discussed: how much money would it cost to build a CNN? And that's how mega media companies think, so the cost of actually going out and doing this thing would be insane."
And it wasn't just CNN's news-gathering ability that Time Warner admired. After bad-mouthing the whole notion of "synergy" -- the old TW shorthand for bringing their brands and ventures together -- a cable advertising executive said, "One of the only companies that has taken synergy to a new level is Turner and then TW. The single most important thread throughout Turner for years was, How can we all make money on a deal? They were the masters at packaging cable properties, arena signage, licensing of characters, etc."
"Time Warner used to be an example of how synergy does not work," continues Quittner. The merger with Warner's music properties, for example, was not always a harmonious one: The language of the music business and the language of journalism did not compute. "Now you've got AOL so you've got journalism and entertainment and new media and the question is, Will that be the missing piece, the synergy that was missing? This could be the lingua franca, the denominator that allows everybody else to function more smoothly and provides everyone with the reach they're so desperate for."
Not that synergy in its old-fashioned sense doesn't continue to play a part. As the ad exec noted, "MovieFone is now part of AOL. So you can call MovieFone and book your seat for the latest Warner release." And by putting all the deal's big players on the dais behind them, AOL chairman Steve Case (who will become chairman of AOL Time) and TW chairman and chief executive Gerald Levin (who will be CEO) clearly meant to send a message to a skeptical world: Look, ma, no discord.
"Look at the body language of this group," said Levin, cueing AOL COO Robert Pittman (the MTV founder who once ran TW's theme parks) to put his arm around TW vice chairman Turner. The Q&A session ended with the predictable photo-ops -- Levin and Case shaking hands, exchanging high-fives -- though I found it most notable that "old-media" guy Levin was the only one onstage without a tie.
Still, it must seem ironic that the company that seemed the most determined to crack the genetic code of the Internet was now, in essence, owned by the upstart some said couldn't sell groceries. AOL's stock has split twice and Pathfinder is now a muddled memory.
Dick Duncan, editor of Time.com and a veteran of the company since the '60s, maintains that Pathfinder (which he helped start) did its job. "The individual brands are doing fine," he says, pointing to both Money.com and People.com (which has an exclusive deal with AOL) as examples.
"What didn't work was the idea that they would have something in common." The individual sites that were meant to comprise a sort of Time Warner Legion of Superheroes did not prove the megadraw the company had envisioned; less than 10 percent of their traffic came from the front page. But still, Pathfinder served as "nursery for individual sites," some of which are all grown up now.
What Time.com's relationship will be to AOL is yet to be determined, but Duncan points out that the site is soon to be bundled into a hub with CNN.com anyway and that it will continue to supply analysis and background to that news site's breaking stories. And the merger does not necessarily limit future potential partnerships. "Corporate relationships don't restrict your ability to get the best deal," he said, pointing to the deal Road Runner (Time Warner's high-speed cable-modem network) has struck with Fox News.
Gone too is much of the proprietary feeling people at TW once had about their company; it has simply morphed and merged too often (and too significantly) to stick around for the ride and not enjoy it.
"The Time Inc. many of us joined is so long gone," said a 16-year veteran writer I spoke to. "I think the feeling is it's better to be the biggest than to have the company stripped. For a while there was a fear they would began to sell off their assets in bits and pieces."
No fear now, at least not the day the merger was announced. Old-timers (those who didn't cash out eons ago) are waiting to see what happens next, while the new folks have the example of editors who got rich on the Time Warner merger to look to. "There are secretaries here who are supposed to be millionaires," says Susan Quick, food editor of the soon-to-be-launched Real Simple. "You wouldn't believe the Prada boots I see in the cafeteria."
It's starting to sound like Condi Nast.