Can this marriage be saved?
After two years of declining profits at America
Online, CEO Jonathan Miller will stand before Time Warner's
board of directors Thursday and argue that the tide is turning.
With rumors swirling that Time Warner is
considering selling the struggling unit, Miller's presentation
might be his best chance to make the case that AOL is worth
keeping.
He's expected to say that while the No. 1
Internet service will continue to lose its core dial-up
subscribers, it has cushioned the blow by slashing costs and by
expanding its nascent base of customers for an AOL service
designed for cable or DSL broadband Internet subscribers. The
company also is seeing growth in premium extra-cost services, in
advertising and in its international business.
Bottom line: While AOL's revenue is expected to
continue to fall, profits should start to rise this year and
beyond, analysts and AOL executives say. And the firm — with
21.3 million dial-up and 3 million broadband users — continues
to throw off about $1 billion a year in cash.
