Steve Case, the visionary founder of the Internet company, America On Line who three years ago engineered a now foundering merger with Time Warner, said he will leave AOL Time Warner within six months. Mr. Case was forced out of the company, in large part, because its share price has plummeted by 70 percent.
Mr. Case is the latest victim of the bursting of the Internet bubble. Three years ago, Mr. Case brilliantly used the high share price of Washington-based AOL to purchase a much larger company, Time Warner, which owns magazines, cable television operations, a movie company and CNN.
The deal, then worth $106 billion, was the largest corporate merger ever. At the time it was hailed as a marriage of the old and new economies. The Internet, through AOL, was to be the method for delivering the content provided by Time Warner's print and broadcast media. At the World Economic Forum in Switzerland, only days after the deal was announced, Mr. Case spoke about the future of the Internet.
"The past decade has been about putting the Internet on the map and really making it relevant. If you think back 10 years ago, it wasn't just AOL that was small, everything was small. The web wasn't even invented. Companies like Amazon and Yahoo didn't exist," Mr. Case said. "So we have made progress in the past decade. But the next 10 years is not just putting the Internet on the map but putting it on the map in every country in the world. And that is going to be a big challenge," he said.
Then in 2000, Mr. Case was portrayed as an Internet pioneer. But at the same time, global stock markets peaked and what we now regard as a bubble in Internet stocks began to deflate. It is a process that has gone on globally ever since. Mr. Case, now pilloried as the father of a failed merger, Monday reflected on his resignation in an interview on CNBC television. He said he will remain on the AOL Time Warner board of directors.
"I've always said it [this Internet age] is a marathon and not a sprint. And I'll keep running the race along with the other outside investors to try and serve the 90,000 employees and millions on individual investors, many of whom I'm sure are watching. There are a lot of families that have put their faith and their family's money into AOL Time Warner. I'm going to continue to work as hard as I can to see that that investment pays off," he said.
AOL is still the world's biggest Internet service provider with 35 million subscribers. One of AOL Time Warner's biggest investors, Ted Turner, the founder of CNN, is said to have pushed hard for Mr. Case's ouster. There is speculation that with media advertising way down and AOL no longer growing fast, the words AOL may be removed from the company's name.
Mr. Case, still only 44, is very wealthy. This corporate visionary who brought e-mail to the masses, is expected to pursue other endeavors in the high tech arena. He founded AOL in 1985.