{
  "docId": "019dd923-622b-71dc-a6dc-5545fa71721e",
  "docSlug": "852eb8103109",
  "documentTitle": "Time Warner Inc. (TWX)",
  "authorId": "14_Icahn",
  "authorName": "Lazard",
  "documentKindSlug": "activist-deck",
  "documentKindLabel": "Activist deck",
  "sourceTypeSlug": "activist_investor",
  "sourceTypeLabel": "Activist investor",
  "presentationDate": "2006-02-01 00:00:00",
  "orientation": "portrait",
  "aspectRatio": 0.77272725,
  "pageNumber": 37,
  "pageCount": 371,
  "prevPage": 36,
  "nextPage": 38,
  "slideType": "executive_summary",
  "function": "summarize",
  "density": "overcrowded",
  "nDataPoints": 2,
  "notes": "This slide is part of a larger Lazard report on Time Warner (TWX). It critiques management's failure to explore alternatives to the Google partnership.",
  "elementsJson": [
    "paragraph",
    "callout_box",
    "footnote"
  ],
  "metadataConfidence": 0.95,
  "imagePath": null,
  "slideHref": "/slides/019dd923-622b-71dc-a6dc-5545fa71721e/37",
  "deckHref": "/decks/019dd923-622b-71dc-a6dc-5545fa71721e",
  "deckJsonHref": "/decks/019dd923-622b-71dc-a6dc-5545fa71721e.json",
  "deckAnchorHref": "/decks/019dd923-622b-71dc-a6dc-5545fa71721e#slide-37",
  "components": [
    {
      "bbox": null,
      "kind": "callout",
      "text": "In negotiating this agreement, TWX did not appear to consider a number of other potential alternatives, including a spin-off, spin-merge or sale of the entire AOL business that could have achieved higher value for TWX shareholders and the Company.",
      "attrs": null,
      "subkind": null,
      "toolName": "Visual emphasis",
      "toolSlug": "visual-emphasis",
      "confidence": null,
      "componentId": "019dd953-14db-7299-bdf6-4db3f3955d99",
      "frameworkName": null,
      "frameworkSlug": null
    },
    {
      "bbox": {
        "h": 0.115,
        "w": 0.766,
        "x": 0.117,
        "y": 0.796
      },
      "kind": "paragraph",
      "text": "AOL's shift in focus to advertising-based revenue is dependent on expanding usage of its various properties, including AOL.com, MapQuest, Moviefone and AIM. AOL remains one of the very best audience aggregators online. This is true quantitatively (114 million unique users) and qualitatively (generally very loyal user base, established personal and demographic data). AOL plans to generate revenue from this traffic through the use of paid search, branded advertising, and increased utilization and optimization of AOL advertising inventory space. The 2004 acquisition of Advertising.com is expected to help AOL with its inventory utilization, adding advanced",
      "attrs": null,
      "subkind": "paragraph",
      "toolName": null,
      "toolSlug": null,
      "confidence": null,
      "componentId": "50fd67d4-3ee8-4b63-90b6-86d7d3d3d906",
      "frameworkName": null,
      "frameworkSlug": null
    },
    {
      "bbox": {
        "h": 0.235,
        "w": 0.766,
        "x": 0.117,
        "y": 0.491
      },
      "kind": "paragraph",
      "text": "AOL's Internet access business faces particular challenges as its US subscriber base continues to decline, driven by the maturing of the dial-up services business and the continued migration of subscribers to broadband or value-priced dial-up services. As a result, and due to the failure of several initiatives to grow revenue through other means, AOL has relied on network service cost reductions in an attempt to grow, or at least maximize, cash flow and profitability. AOL has admitted that these cost savings will be lower going forward, as it has extracted most of the savings already (headcount and SG&A savings are likely still possible). One avenue of potential growth would be to achieve greater success in migrating AOL's dial-up subscribers to broadband. AOL generally realizes lower gross margins from broadband subscribers, but customers that have migrated are less likely to churn to alternative providers, thus increasing their lifetime value. AOL recently announced a series of DSL wholesale agreements with Verizon, AT&T, BellSouth, and Qwest to offer DSL access services at a price starting at $25.90 per month. Also, five years after the Merger, AOL is finally beginning to deepen its relationship with TWC and its Road Runner high-speed online service.",
      "attrs": null,
      "subkind": "paragraph",
      "toolName": null,
      "toolSlug": null,
      "confidence": null,
      "componentId": "5a72d23f-b063-4635-8416-e661307d6774",
      "frameworkName": null,
      "frameworkSlug": null
    },
    {
      "bbox": {
        "h": 0.045,
        "w": 0.766,
        "x": 0.117,
        "y": 0.108
      },
      "kind": "paragraph",
      "text": "the final language is completed. Fortunately Google has classified the agreement as material and filed its disclosure under Item 1.01 so TWX investors should be able to discover TWX's commitments through Google's future disclosures.",
      "attrs": null,
      "subkind": "paragraph",
      "toolName": null,
      "toolSlug": null,
      "confidence": null,
      "componentId": "c65ace0b-d6b7-4306-a1bb-5c4abeda66b1",
      "frameworkName": null,
      "frameworkSlug": null
    },
    {
      "bbox": {
        "h": 0.085,
        "w": 0.766,
        "x": 0.117,
        "y": 0.167
      },
      "kind": "paragraph",
      "text": "Also, the negotiation process with Google and MSN was largely focused on search partnerships. In negotiating this agreement, TWX did not appear to consider a number of other potential alternatives, including a spin-off, spin-merge or sale of the entire AOL business that could have achieved higher value for TWX shareholders and the Company. Given the potential long-term implications of the Google partnership, shareholders would have been better served if TWX management had fully considered all the alternatives.",
      "attrs": null,
      "subkind": "paragraph",
      "toolName": null,
      "toolSlug": null,
      "confidence": null,
      "componentId": "cd8039ba-bd2c-4f99-9feb-3cd40de7d0c6",
      "frameworkName": null,
      "frameworkSlug": null
    },
    {
      "bbox": {
        "h": 0.065,
        "w": 0.766,
        "x": 0.117,
        "y": 0.344
      },
      "kind": "paragraph",
      "text": "AOL reorganized into its current business unit structure during the 4th quarter of 2004. This reorganization was in part intended to help better balance the Subscription and Advertising businesses. In response to serious threats to its core premium-priced dial-up subscription business, AOL plans to place more emphasis on advertising and search, which are higher margin businesses and are expected to grow for the foreseeable future.",
      "attrs": null,
      "subkind": "paragraph",
      "toolName": null,
      "toolSlug": null,
      "confidence": null,
      "componentId": "e3cb9db4-2a8e-43b7-9429-872a464b432f",
      "frameworkName": null,
      "frameworkSlug": null
    },
    {
      "bbox": {
        "h": 0.012,
        "w": 0.305,
        "x": 0.117,
        "y": 0.928
      },
      "kind": "source-note",
      "text": "(a) comScore Media Metrix. Includes all TWX properties.",
      "attrs": {
        "numbered": true
      },
      "subkind": null,
      "toolName": null,
      "toolSlug": null,
      "confidence": null,
      "componentId": "bacd4cf4-1645-4dac-9470-cf2c70a76c5f",
      "frameworkName": null,
      "frameworkSlug": null
    },
    {
      "bbox": {
        "h": 0.015,
        "w": 0.175,
        "x": 0.708,
        "y": 0.078
      },
      "kind": "title",
      "text": "CHAPTER 2A: AOL",
      "attrs": null,
      "subkind": "headline",
      "toolName": null,
      "toolSlug": null,
      "confidence": null,
      "componentId": "592712be-11fe-442e-9e51-31ead3c81f2d",
      "frameworkName": null,
      "frameworkSlug": null
    },
    {
      "bbox": {
        "h": 0.018,
        "w": 0.235,
        "x": 0.117,
        "y": 0.301
      },
      "kind": "title",
      "text": "Current AOL Strategy",
      "attrs": null,
      "subkind": "headline",
      "toolName": null,
      "toolSlug": null,
      "confidence": null,
      "componentId": "62dec677-9509-4da1-9986-9cfcedf6ee49",
      "frameworkName": null,
      "frameworkSlug": null
    },
    {
      "bbox": {
        "h": 0.015,
        "w": 0.115,
        "x": 0.117,
        "y": 0.438
      },
      "kind": "title",
      "text": "SUBSCRIPTION",
      "attrs": null,
      "subkind": "subtitle",
      "toolName": null,
      "toolSlug": null,
      "confidence": null,
      "componentId": "11178187-5cd4-44e4-aa95-939bf203aa66",
      "frameworkName": null,
      "frameworkSlug": null
    },
    {
      "bbox": {
        "h": 0.015,
        "w": 0.105,
        "x": 0.117,
        "y": 0.768
      },
      "kind": "title",
      "text": "ADVERTISING",
      "attrs": null,
      "subkind": "subtitle",
      "toolName": null,
      "toolSlug": null,
      "confidence": null,
      "componentId": "243aad4c-268e-4732-838d-2b537f445c70",
      "frameworkName": null,
      "frameworkSlug": null
    }
  ],
  "metrics": [],
  "tools": [],
  "frameworks": [],
  "arcBeats": [
    {
      "to": 50,
      "from": 31,
      "beatId": "ea5783e1-e74d-4501-8f63-31239b39ce7f",
      "arcName": "The Consultant's Gambit",
      "arcSlug": "consultants-gambit",
      "beatName": "Evidence & Proof",
      "beatSlug": "consultants-gambit-evidence-proof",
      "evidence": "The document provides evidence and proof of the challenges and complications faced by Time Warner Inc., including financial data, market analysis, and benchmarking.",
      "position": 2,
      "confidence": 0.8,
      "parentBeatName": "Evidence",
      "parentBeatSlug": "evidence"
    }
  ],
  "loops": [],
  "imagePathAlt": null,
  "thumbSrc": null,
  "thumbSrcAlt": null,
  "locked": true
}