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...Numbers $99 Billion reported by AOL Time Warner for 2002 was the largest-ever annual loss by a U.S. company...
...company (which owns TIME) can use all the help it can get. Ever since Case, then head of AOL, and Gerald Levin, then chief of Time Warner, agreed two years ago to complete the $106 billion deal in which the online upstart bought the old-media giant, their union has produced a Shakespearean torrent of pain and recrimination. As the Internet bubble burst and advertising slid into recession, the company's executives were slow to adjust their lavish profit-growth promises to Wall Street, which struck back hard. Having tumbled from a high of $56.60, the price of AOL Time...
...days after Case's resignation, speculation arose that some outside stockholders were trying to force the company to bring in Viacom president Mel Karmazin, but no one could produce evidence that anyone in charge at AOL had spoken with him. Instead, the AOL board acted swiftly to elect Parsons as both chairman and CEO, strengthening his hand as he takes on one of the toughest turnaround tasks in corporate America...
Over the next year or so, Parsons must manage AOL Time Warner's $26 billion in debt to avoid a downgrade in the company's credit rating. He plans to spin off a minority interest, valued at about $4 billion, in the company's cable-TV assets. Parsons must revive the AOL online division, which is dragging down the successful entertainment, publishing and cable divisions. He must deal with multiple federal investigations of AOL's accounting practices before and after the merger, and if those probes turn ugly, judge whether it makes sense to keep "AOL" in the company name...
During his interview with TIME, Parsons, a New York City native and former corporate lawyer, seemed at once sober and cheerful. He described 2003 as "a reset year," in which the AOL division will be reorganized and streamlined to better serve its traditional dial-up customers while it seeks to win more broadband subscribers. If all goes well, Parsons says, the online division could return to earnings growth in 2004, at double digits in following years. If results fall short of that goal--as some industry analysts predict they will--insiders say the division will at least be dressed...