Feeds

Google's AOL stake walks the plank

A $726m loss? We'll take it

Gartner critical capabilities for enterprise endpoint backup

Google recently stomached a $726m write-down thanks to its stake in the increasingly-irrelevant America Online. And now it looks like the search giant wants out of its AOL investment entirely.

Today, during his quarterly earnings call with reporters and analysts, Time Warner CEO John Martin said that Google recently asked if it could exercise the so-called "demand registration rights" for its 5 per cent stake in AOL.

In other words, Google has asked Time Warner to either buy back its three-year-old AOL stake or spin AOL off as a public company. "We are reviewing the request. But we have several options, including proceeding with the request, delaying a decision for some time or buying back Google’s stake at an appraised value, which would obviously be well below the original amount," Martin said, according to All Things Digital.

Considering the state of the economy - not to mention AOL's gradual descent into complete irrelevance - it's unlikely Time Warner would take the company public. We can only assume the media giant will buy back Google's share - if that's what Google wants. Google paid $1bn for the five per cent stake back in 2003, and now the market value is down to about $274m.

As others have speculated, Google's Time Warner request may be its way of encouraging Time Warner to extend its search deal with AOL. Google currently provides both paid and un-paid search results on AOL.

But voices are also wondering whether Google is angling to update the deal so it can continue serving AOL search results even if the company is sold to a third party. There's been some talk, you may have noticed, about Yahoo! nabbing AOL.

Google did not immediately respond to a request for comment.

During Google's latest earnings call, CEO Eric Schmidt said that the company's AOL deal and its investment in WiMAX struggler Clearwire "made sense to us then and make sense to us now and continue to be a strategic part of our overall business philosophy."

But Schmidt likes to spin. Google may be happy with the $274m its AOL stake would bring today. It'll bring even less tomorrow.

In Q4, Time Warner says, AOL revenues dipped to $968m, a 23 per cent fall from the year before. Ad revenue fell 18 per cent, and subscription revenue fell 27 per cent. ®

Gartner critical capabilities for enterprise endpoint backup

More from The Register

next story
6 Obvious Reasons Why Facebook Will Ban This Article (Thank God)
Clampdown on clickbait ... and El Reg is OK with this
No, thank you. I will not code for the Caliphate
Some assignments, even the Bongster decline must
Fast And Furious 6 cammer thrown in slammer for nearly three years
Man jailed for dodgy cinema recording of Hollywood movie
Caught red-handed: UK cops, PCSOs, specials behaving badly… on social media
No Mr Fuzz, don't ask a crime victim to be your pal on Facebook
Barnes & Noble: Swallow a Samsung Nook tablet, please ... pretty please
Novelslab finally on sale with ($199 - $20) price tag
Ballmer leaves Microsoft board to spend more time with his b-balls
From Clippy to Clippers: Hi, I see you're running an NBA team now ...
Video of US journalist 'beheading' pulled from social media
Yanked footage featured British-accented attacker and US journo James Foley
Assange™: Hey world, I'M STILL HERE, ignore that Snowden guy
Press conference: ME ME ME ME ME ME ME (cont'd pg 94)
Call of Duty daddy considers launching own movie studio
Activision Blizzard might like quality control of a CoD film
prev story

Whitepapers

Implementing global e-invoicing with guaranteed legal certainty
Explaining the role local tax compliance plays in successful supply chain management and e-business and how leading global brands are addressing this.
5 things you didn’t know about cloud backup
IT departments are embracing cloud backup, but there’s a lot you need to know before choosing a service provider. Learn all the critical things you need to know.
Why and how to choose the right cloud vendor
The benefits of cloud-based storage in your processes. Eliminate onsite, disk-based backup and archiving in favor of cloud-based data protection.
Top 8 considerations to enable and simplify mobility
In this whitepaper learn how to successfully add mobile capabilities simply and cost effectively.
High Performance for All
While HPC is not new, it has traditionally been seen as a specialist area – is it now geared up to meet more mainstream requirements?