AOL and Time Warner merger.

Essay by aznXsa2587 September 2005

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Merger Madness

How can multi-million dollar companies make themselves larger than they already are? Simple, they merge with another giant to make a super giant. Sounds easy, but it doesn't always work out profitable. January 2000 was the month of one of the biggest mergers between two large-scale media companies, America Online and Time Warner. Was a merger the best move for Steve Case of AOL and Gerald Levin of Time Warner? Or will it fail and both super powers will be laid to rest?

Before merging with AOL, Time Warner was a powerhouse in itself. It owned such companies as CNN, Turner Broadcasting, Home Box Office (HBO), Time Inc., Time Warner Cable, Warner Brothers, and New Line Cinema. It was a very profitable corporation, but it lacked a company on the Internet front. Its motion picture companies were holding their own. Warner Brothers and New Line Cinema were both considered in the top eight motion picture companies in 2000 in both the domestic and foreign fronts.

In 2000, Warner Brothers grossed about $891.7 million domestically and around $635 million overseas. Warner Brothers also put out an amazing 712 DVD title releases from 1997-2000. This is considered a worthy achievement considering the relative time DVDs have been available to consumers.

Time Warner was also very successful on the television front. As of October 26, 2000, Time Warner Cable had 19% of cable television subscribers in the United States. In 2000, between all companies owned by Time Warner Inc. in television, they profited about $4.939 billion dollars. Time Warner also managed 719,000 cable modem subscribers as of September 30, 2000. They were only second to AT&T, who had 888,000 subscribers. If you thought all that was not enough, Little Brown & Company Inc., a children's book publisher, grossed about $62.7 million...