Microsoft to Buy Stake in AOL

NetDanzr writes "According to various sources (Bloomberg, Reuters, CNet), Microsoft is in talks with Time Warner to buy a stake in AOL. While the size of the stake or its prize has not been disclosed yet, Bloomberg speculates that this deal would profit both companies. Microsoft would profit from merging the AOL portal with MSN, as a strategy to catch up with his rivals in this space Yahoo and Google, while Time Warner would gain some ammunition in its fight with a renegade shareholder, Carl Icahn. According to CNBC, AOL is just about to turn the corner and is currently the most undervalued division of Time Warner."

Comments

Bye bye Netscape

[RancidMilk]

Does this mark the end of netscape???

Let's see...

[op12]

MSN is not used by more than a handful of people as Google and Yahoo have been doing it better and cover both the cluttered and non-cluttered interfaces (whichever you prefer).

And AOL has been steadily losing members.

Sounds like a match made in heaven.

IE lock-in

[phayes]

More probably, buying into AOL is a good way for Microsoft to ensure that AOL never abandons IE for Mozilla...

This is worrying

[gowen]

Given AOL/Netscape's prime role in Mozilla development, I'd suggest this might be a nice plan to slow down the opposition, too. Yes, the Moz Foundation is independent, but the last time I checked, many of the dedicated coders are still AOL employees.

Re:This is worrying

[archen]

No, i'd say it's insightful. AOL does not contribute to Mozilla, but still controls NETSCAPE. To us the difference is minor, but some still cling to the netscape name, and perhaps the portal still as well. This would also garantee that AOL does not switch to Firefox or something else as its web browser.

That aside, AOL still controls ICQ, AIM, and Winamp. All of which compete directly with MS products.

Ms controling netscape is bad enough, but MS lording over Winamp?? *cringe*

i don't get it

[SamSeaborn]

There must be some huge aspect of the internet that I'm just out of the loop on.

I don't use AOL, I don't use MSN ... I hardly even use instant messaging ... I just browse with Firefox and use email.

I hear about how AOL is a major corporation and I wonder ... how? why? I hear that MSN and AOL are apparently merging, and I wonder ... how does that affect me? Why do people care?

Really ... just ... don't ... get it. What am I missing?

Sam

Re:i don't get it

[ChocoBean]

maybe it doens't affect you if you don't have relatives or friends or co-workers who in turn know other people from the states. The infiltration of MS and AOL is really deep in the "real" world, y'know.

Just because you don't happen to use something everyone's heard of doesn't mean it isn't important. Don't you remember the days of your youth when everything other people care about, you care about as well?

Re:i don't get it

[RealProgrammer]

There is a huge chunk of the online population in the U.S., perhaps most of it, for whom computers are a tool, like a hammer or a radio. They never bother to investigate what else you can do with a hammer besides tack up a picture, nor ever realize that there is more to a radio than "FM 104.3 - your home for today's Country and all time favorites".

For those folks, the Internet is either the little blue "e" or it's AOL. They don't have broadband, but they want it because the marketing geniuses at AOL have been telling them that AOL for broadband is better.

There is another set of users, mostly teenagers, who use either AIM or MSN Messenger to send messages back and forth to their friends' cell phones all day long. It's like passing notes in class, but they do it before breakfast, during breakfast, in the car, between or in classes, and so on. They do homework over it.

The teenagers don't know or care, for the most part, that there are dozens of IM clients and that they all pretty much work. They have MSN or AIM and that's all they need.

A portion of both groups discover eventually that the world is bigger than their little corner of it, but, like programmers using vi to edit CSS, they stick with their original chat and web clients even knowing that there are better alternatives.

I suspect that Microsoft and AOL has some synergy in that environment.

Re:i don't get it

[Joe the Lesser]

Ah, but those teenagers aren't actually paying for that IM service, which is why there's no need to switch to something that possibly would temporarily disrupt their social circle. Sure, other programs are slightly better, but you'd be surprised how little that matters when you are comfortable with what you have and it gets the job done.

Re:i don't get it

[cli_rules!]

You mean there's something better than vi??

Re:i don't get it

[burris]

Don't be stupid. These people want broadband because they are painfully aware of how long it takes to download pictures, music, movies, tv shows, and porn. They don't do it just because they are told to.

The end of what ? Anybody remember when...

[OneInEveryCrowd]

Sperry Univac merged with Burroughs at the end of the mainframe era and how that merger turned the mainframe business around ???

Re:holy shit!

[Coneasfast]

are you guys going to make some jokes about this?

this is no joke.

hotmail was good, and it was popular.
MS took it over and turned it into the most worst email (the low storage, the spam, the restrictions, etc) service ever. nevertheless, people keep using it because it's what they always used or what their friends use.

now take AOL, something already crappy. i can't possibly imagine what microsoft can do it. maybe this time around people will actually shy away to something else.

AOL != Mozilla Foundation

[Beuno]

I do not see how MS buying AOL stock is going to change ANYTHING at all in the Mozilla Foundation.
They are self-sufficient, independent and have been since at least the start of FireFox.
I think there are more programmers working in google then in AOL.

Think about it - this is not about AOL per se..

[CdBee]

Microsoft sees its future in the media distribution/licencing business - hence so much R&D of their proprietary secured codecs for audio and video.

AOL is presently owned by Time Warner

Heavenly Delight

[rapturizer]

AOL's lousy service plus M$'s lousy software, all forced upon corporations = $$$ for the consultants who will have the misfortune of making it (at least attempting to)work.

Re:Heavenly Delight

[Linker3000]

Hey I'm a consultant - break out the champagne!

Re:holy shit!

[SalsaDoom]

Holy shit indeed!! One thousand hours... thats like 41 days.

Do you think its possible they might be able to tweak a windows install to be able to run for 41 days?! :)

--SD

Antitrust anyone?

[zappepcs]

This is possibly a most evil move. MS buys into AOL and has control (of some sort) of the browser market (IE, Netscape, Mozilla funding) but even more evil is that MS buys into several other categories:

Digital content distribution (Time-Warner)
VoIP (Time-Warner networks)
Combined IM markets (AIM/MSN)
DRM on all that content

I hope that those anti-trust government types see this as evil the way that I do. I can't remember what cable companies are tied up in this mess, should it happen, but this is a move by MS to take over communications, digital and voice, as well as a large share of content and content distribution. EVIL EVIL EVIL... that's all I can see in it.

I'm betting that the government will not be able to see the all digital, all-IP future that the FCC and others are trying to create being brought to a corporate congolmeration through moves like this one... Science fiction horror stories happening in real life.

The jokes about MSN and AOL securing MS position with worst portal and search abound, but it proves that most computer users don't care or are clueless. That means that if MS manages this, the world of digital content and communications may become a very bad thing... imagine using an MS phone service? or MSN cable? You'll soon be able to get a BSOD on all your entertainment and communication devices!

EVIL EVIL EVIL!

AOL vs AOLTW

[mcc]

But they aren't buying stakes in Time Warner, they're buying stakes in AOL's time warner division.

Of course, this still brings up an interesting thought. This means that if/once this all goes through, America will have basically three noteworthy television news sources; CNN, which has business entanglements with Microsoft; MSNBC, which has business entanglements with Microsoft; and Fox News, which is frequently brushing against antitrust law and, hm, how shall I put this, some people feel tends to give special deference to Republican ideology.

The reason I bring this up is this. Eventually, Microsoft is going to get into another antitrust lawsuit. Given the above, how do you think TV news is going to portray this...?