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Wenner Media Digital Boss Michael Bloom Leaves After Six Months

Peter Kafka — Sat, 19 Nov 2011 15:43:31 +0000

Wenner Media’s chief digital officer is out after six months.

Michael Bloom joined the publisher, which owns Rolling Stone, Us Weekly, and Men’s Journal, in May. On Friday afternoon, he sent out a memo announcing his departure. Here’s the bulk of the note:

As some of you already know, I’m moving on from Wenner Media. While it’s been a relatively short time, I’ve really enjoyed working with so many talented and creative people across Wenner’s incredible brands.

Over the past six months, a new digital leadership team has been put in place, and a lot of great work has been done to set the foundation of what will be a terrific digital future. I’m proud of what you guys have accomplished and I know that you will go on to do great things in 2012. I’ll certainly be rooting for you from the sidelines.

Unlike many of his competitors, Wenner Media owner Jann Wenner has never rushed to embrace digital publishing. For a long time, he did very little with the Web beyond handing over his flagship RollingStone.com site to RealNetworks.

That deal made him money, but it also allowed upstarts like Pitchfork to grab lots of territory and mindshare over the years. Last year, Wenner got control of the site again and moved to put most of it behind a pay wall.

Around the same time, Wenner declared himself unimpressed with the commercial upside of the iPad for magazine publishers, a position that put him at odds with the conventional wisdom. Since then, many of his peers have become much more sympathetic to his take.

Bloom, who had previously put in time at Sharecare, MTV, and AOL Time Warner, didn’t mention a new job in his note; Wenner Media hasn’t announced a replacement. I’ve asked Bloom and a Wenner rep for comment.

He's Back: Bob Pittman Named CEO of Clear Channel

Kara Swisher — Sun, 02 Oct 2011 21:00:08 +0000

Longtime media and Internet exec Bob Pittman has been named CEO of radio broadcast and outdoor advertising giant Clear Channel, the company announced today.

Pittman — who has been chairman of Clear Channel’s media and entertainment platforms after making an investment in the company less than a year ago — will join the board of directors of CC Media Holdings, Clear Channel Communications and Clear Channel Outdoor Holdings, as executive chairman.

Clear Channel’s holdings include a huge parcel of radio stations across the U.S., along with a number of digital properties and a big global outdoor advertising business.

Pittman — the former MTV wunderkind who started in radio at 15 years old as an announcer at a station in his native Mississippi — has not been in a top job like this one since he resigned from the then-AOL Time Warner as its COO in the midst of the botched merger mishegas almost a decade ago.

Since then, Pittman has been doing a range of things, including making canny investments in a variety of Internet start-ups such as Zynga and DailyCandy, and even in a high-end tequila company via the Pilot Group, a New York-based private investment firm.

He made his own investment in Clear Channel last year and has since upped his involvement, which resulted in the latest move to CEO.

“I swore I would never work like this again, but when something gets me this stimulated, I knew I wanted to get into it again,” said Pittman, in an interview with me yesterday. “I think this company has everything it needs to be a great media company in the new media landscape.”

That will include a range of new initiatives, including recent partnerships with Facebook and more.

“We want to move like an entrepreneur and have the assets of a big media company,” said Pittman. “I am an addict for this challenge.”

Here’s the official press release from Clear Channel:

BOB PITTMAN NAMED CEO OF CC MEDIA HOLDINGS

Appointment Underscores Clear Channel’s Evolution to a Fully Realized, Integrated Media, Digital and Entertainment Enterprise

Media Pioneer Will Oversee the Company’s Global Media Properties, including Broadcast, Digital and Mobile, Syndication, Media Representation and Outdoor

New York, NY — October 2, 2011 — CC Media Holdings, Inc. (OTCBB: CCMO), a leading global media, digital and entertainment company, announced today that Bob Pittman will become its Chief Executive Officer. Pittman joined Clear Channel in November 2010 as an investor and the company’s Chairman of Media and Entertainment Platforms. Pittman will join the Board of Directors of CC Media Holdings, Inc. and Clear Channel Communications, Inc.; in addition, he will join the Board of Directors of Clear Channel Outdoor Holdings, Inc., as its Executive Chairman. These appointments are effective immediately.

In his new role, Pittman will oversee the company’s businesses, which include:

Clear Channel Radio, which serves 150 cities through 850 owned radio stations and an additional 100 cities and 4,000 stations through its syndicated Premier Radio Networks products. Clear Channel Radio also includes:

* Clear Channel Digital, which develops and operates iHeartRadio, the free, industry-leading digitalradio product that combines access to all of Clear Channel’s live broadcast and digital-only radio stations as well as user-created Custom Stations. Clear Channel Digital also develops the companion digital products for each radio station brand, including strong social components;

* Media Services for the radio, media, digital, mobile and music industries, including Total Traffic Network, a groundbreaking programming and technology service delivering real-time traffic data to vehicles via in-car and portable navigation systems, broadcast media, wireless and Internet-based services; The Katz Media Group, the leading media representation firm in the US for radio and television stations; and RCS, which provides scheduling and broadcast software for radio, internet and television station in addition to research studies that aid the media and music businesses.

Clear Channel Outdoor Holdings, which is one of the world’s largest outdoor advertising companies with close to one million displays in over 40 countries across five continents. Clear Channel Outdoor includes:

* Americas Outdoor Advertising, which owns or operates nearly 190,000 displays across the United States, Canada and Latin America including operations in 49 of the 50 largest markets in the United States. The Americas businessconsist of various types of displays that include billboards; street furniture; transit displays; the Clear Channel Airports division, which is the premier innovator of contemporary display concepts and currently operates more than 260 airport programs across the globe; mall displays; wallscapes; and spectaculars including Spectacolor, a market leader in spectacular sign displays, with displays located in New York’s Times Square. The Company has been a leader in the development and operation of digital displays and networks across many of its U.S. markets.

* International Outdoor Advertising operates across Asia, Australia and Europe with displays across nearly 30 countries. The International business consists of street furniture and transit displays, billboards, mall displays, wallscapes and spectaculars. Clear Channel International’s street furniture division operates over 3,500 municipal advertising contracts worldwide.

Pittman will also remain a member of Pilot Group, LLC, a New York-based private investment firm.

“On behalf of the Board of Directors, I want to express how delighted I am that Bob has accepted this position,” said Mark Mays, Chairman of Clear Channel Media Holdings. “He has been an invaluable contributor to Clear Channel Radio since last November, and he is the perfect person to take Clear Channel to the next level. I look forward to his leadership of our company.”

“Bob Pittman brings a long history as a brilliant innovator and brand builder — from his days as a very successful radio programmer, creator of MTV and CEO of MTV Networks to his work helping to drive the phenomenal growth of AOL and his successful investments in other digital, media and technology companies. He has already generated a renewed sense of confidence and direction not only at Clear Channel, but across the entire radio and media landscape,” said Scott Sperling, Co-President of THL Partners.

“I’m thrilled we were able recruit Bob into the CEO role at Clear Channel. He is the perfect fit to lead this incredibly powerful media platform. He embraces creativity, and has given employees the motivation and freedom to innovate, take risks and succeed,” said John Connaughton, Managing Director of Bain Capital. “He thinks big, is not afraid of change and is intensely focused on driving new businesses, expanding our creative talent and maximizing the full value of Clear Channel’s extraordinary assets, ideas and people.”

Pittman’s appointment comes on the heels of several industry-leading achievements by Clear Channel Radio this past year. In March, the company acquired digital music company Thumbplay for its state-of-the-art technologies as well as its technology and product teams. Last week, Clear Channel hosted the iHeartRadio Music Festival, the largest live concert event in radio history, which marked the official launch of the New iHeartRadio, which combines more than 850 of the nation’s most popular live broadcast and digital-only radio stations from 150 cities with user-created Custom Stations. iHeartRadio was one of the few highlighted new products at Facebook’s f8 conference on September 22nd, where it was recognized for its technology and cutting-edge social integration.

Additionally, Clear Channel has demonstrated its unique national promotional capabilities through significant relationships with record labels and social media leaders, and forging relationships with partners like Microsoft, Facebook, Zynga, Toyota and HP that reach further and deeper than advertising.

“Over the past year, I’ve had the unique opportunity to look at the Clear Channel people and assets up close and have found myself increasingly drawn to the company, to the point where the chance to get even more deeply involved has just become irresistible,” said Pittman. “I know first-hand that we have great people and the assets that allow them to do great things. We are so much more than just transmitters and broadcast towers — we leverage our local brands, personalities, strategic relationships and programming expertise to create unique experiences that forge real connections with consumers across our multiple platforms.”

Pittman continued, “I look forward to continuing to work closely with John Hogan and the Clear Channel Radio team to grow our company as we strengthen relationships with our consumers, advertisers, artists, labels and partners, nationally and locally — and I’m excited by the opportunity to work with Ron Cooper and William Eccleshare to help them make the most of our outdoor advertising potential by tapping into Clear Channel’s assets as a whole. I believe we have the technologies, the physical infrastructure, the content and, most importantly, the people to market to consumers better than any other media company in the world.”

New Early-Stage VC Firm, Freestyle Capital, Launches

Kara Swisher — Mon, 12 Sep 2011 13:00:52 +0000

Every day a bell rings, a venture capitalist gets its wings.

Okay, maybe not, but longtime tech entrepreneurs Josh Felser and Dave Samuel will announce a new early-stage VC firm called Freestyle Capital, with $27 million in new investment funds.

Felser and Samuel co-founded Crackle, which was acquired by Sony for $65 million in 2006; and Spinner.com, which was bought by what was then AOL Time Warner for $320 million in 1999.

The pair said the fund builds on 27 preexisting start-ups they had already made investments in.

Although Felser and Samuel are announcing Freestyle at the TechCrunch Disrupt conference today, they don’t run any tech news site for AOL — so all should be well.

Here’s the official press release:

Veteran Internet Entrepreneurs Launch Freestyle Capital, a Venture Capital Firm Focused on Early Stage Startups Freestyle Capital Receives $27 Million in Fund I Close

SAN FRANCISCO — September 12, 2011 – Today, at TechCrunch Disrupt, the industry’s early-stage startup networking event, Internet technology veterans Josh Felser and Dave Samuel formally introduced Freestyle Capital, a new venture capital firm focused on seed and early stage investments in consumer and web-based enterprise technology startups. Felser and Samuel, serial Internet entrepreneurs who together co-founded both Crackle (acquired by Sony for $65 million in 2006) and Spinner.com (acquired by AOL Time Warner for $320 million in 1999), also announced that they have raised $27 million in a new fund closed from limited partners including Cendana Capital and Hall Capital. The new fund builds on a pre-existing portfolio assembled by Felser and Samuel.

Freestyle Capital will focus on providing early-stage startups with both funding and counsel — drawing upon the investment capabilities and real-world experiences of Felser and Samuel — to guide technology startups to the next stage of development. Freestyle Capital is looking for young companies with transformational business ideas presenting seed funding and early stage investment opportunities in the range of $100,000-$500,000.

To date, Freestyle has invested in more than 27 companies, including: GoInstant; Byliner; CrowdFlower; Get Satisfaction; Typekit; about.me (acquired by AOL); BackType (acquired by Twitter); and CoTweet (acquired by ExactTarget).

“Every time we make an investment decision, we draw upon our own deep entrepreneurial experience to unearth the critical success factors for each company — an approach fundamentally different from that of most VCs,” said Felser, co-founder of Freestyle Capital. “Immediately post-investment, we provide a hands-on approach that leverages the knowledge we’ve gained as successful startup CEOs in developing, marketing and leading web-based businesses. Partnering with entrepreneurs at the seed stage is the next best thing to actually being founders ourselves.”

Samuel, who launched his first start up at the age of ten, said: “Like the rest of the world, Josh and I have seen how Internet technologies can transform our lives — but we also know first-hand the long road it takes to get there. This experience is what really sets Freestyle apart from many other investors. With a practiced eye toward bringing solutions to market for real-world business applications, we are excited to ‘pay it forward’ for the newest technology innovators.”

Time for a Sequel to AOL-Time Warner?

Dennis K. Berman — Tue, 29 Mar 2011 21:21:49 +0000

This isn’t a joke. The buzz from California is that it just may be time to try another AOL-Time Warner.

That $164 billion merger disaster defined a decade of thoughtless deal making, reckless ego and vaporous “synergy.”

But for Hollywood executives and bankers now toting their iPads like baby blankets, the new technology has brought them back to an old conversation about “content” and its distribution.

Just as cable-television upended the distribution of films and television, so too are increasingly mature digital platforms like 20 million-customer Netflix or even Google Inc.’s YouTube. As these platforms spar with cable-operators and media conglomerates for consumer attention, they are finding it increasingly necessary to differentiate themselves.

Read the rest of this post on the original site

Weekend Update 11.21.09–The House of Cards Edition

Drake Martinet — Sat, 21 Nov 2009 20:30:55 +0000

In tough economic times like these, even the biggest businesses get the urge to restructure, reorg and reshuffle.

Kara began Monday with some of the hard facts from the pending AOL-TimeWarner (TWX) split. Stock issued for the post-spinoff AOL places the company’s total implied value at around $3 billion. Also on the list of stuff from 1994 being jettisoned from tech companies is the original instant messenger, ICQ. Kara reported that AOL seeks to shed the brand in an effort to keep the larger ship afloat. Over at Yahoo (YHOO), Kara opened the lid on CEO Carol Bartz’s shifting of top execs. In Silicon Valley’s house of cards, everyone watches out for a shuffle.

Over at Digital Daily, John brought some hard numbers to the stresses being felt by AT&T’s (T) 3G network thanks to a certain fruit-flavored smartphone. It seems that the iPhone is largely responsible for the 2,000 percent increase in data traffic in the San Francisco Bay Area compared with a year ago. (Weekend Update doesn’t claim sole responsibility.) Keeping up with layoff news these days is almost a full-time job. It’s a good thing Paczkowski is on the case. This week, Sony-Ericsson let roughly 2,000 employees go. The firm plans to shutter whole offices in both the United States and abroad. John finished strong with a whole slew of posts about the forthcoming Google (GOOG) Chrome OS, which was released in a developer’s beta this week. Next year, the good kids may be getting their stockings filled with Chrome rather than Apples.

You can never tell what MediaMemo will have up its sleeve in a given week, and this one was no exception. Peter came in early with reports that Wired magazine is another publication betting on a certain tablet. Wired may pave the way for other Condé Nast publication e-editions. From the department of “Hey, it looks like it worked for them,” a couple of music giants will release a Hulu-like service for music videos. No word yet on whether the Internet killed the video star. Peter closed it out this week with the fizzle that will be Oprah’s broadcast career. The talk-show-host-turned-deity will end her broadcast career in 2011, but may not be sorely missed by CBS, according to MediaMemo. Everyone is pretty torn up about Gail leaving though.

Personal Technology went a little off the reservation this week and covered an intriguing specialty gadget with a very specific target audience. The reading aid for the visually impaired is unusual for many reasons, not the least of which is that its branded Intel (INTC) both on the inside and outside. The reader uses a downward-facing camera to read text and translate it directly to speech. Walt was pleased with the device on the whole, though he encountered some bugs and a somewhat steep learning curve that may be a function of the novel nature of the product. Over at Mossberg’s Mailbox, the lead question this week was about data loss. Once the geek shudders stopped, Walt let the reader know that there are many alternatives to Apple’s (AAPL) Time Capsule drives, and the integrated Time Machine option is one useful alternative. At Mossberg Solution, Katie won a fight with a Pixi and brought us the blow-by-blow account. The cheap-and-cheerful version of the Palm (PALM) Pre features a stripped-down price. That savings came at too high a performance cost, said Katie. She praised Palms webOS, but came down on the side of spending a little more to get the Pre.

Stay tuned and check back often. Weekend Update will be back next week as long as we can make it out for the Black Friday sales with all our fingers and toes.

It's Another Tequila Start-Up: Bob Pittman's New Venture

Kara Swisher — Fri, 16 Oct 2009 09:14:45 +0000

Earlier this week, while in New York, BoomTown paid a visit to well-known media and Web exec Bob Pittman to hear about his newest venture.

And, as it turned out, it tasted pretty good.

That’s because the former MTV wunderkind, AOL top exec and currently, investor in a wide range of media and Web companies, is making tequila instead of Internet sites.

Thank God it’s Friday!

That might be the liquor talking, since accurate reporting is a requirement at All Things Digital–but this was one of the more enjoyable interviews I have had with Pittman over many, many years.

After leaving the job of COO at then-troubled AOL Time Warner (TWX) in 2002, Pittman has been investing via the Pilot Group in Web start-ups like Thrillist, iLike, Zynga, Next New Networks, as well as radio and television properties.

Pilot sold DailyCandy to Comcast (CMCSA) in 2008 for a reported $125 million.

Tequila-making is yet another unusual tack for Pittman, who is now busy trying to turn “Casa Dragones”–which is made from the blue agave plant in Mexico–into the next big thing in the high-end liquor business.

Aiming directly at the top-shelf brands like Gran Patrón, Pittman is trying for a “sipping” tequila, in contrast to most versions, which typically deliver a sharp kick.

Using a series of tasting parties and marketing efforts to make the $275-a-bottle tequila a must-have at key bars and clubs, it will be interesting to see if Pittman can turn spirits into profits.

Here’s Pittman talking about his tequila adventure in a video interview (and, below it, Joe Nichols singing one of my favorite country songs, “Tequila Makes Her Clothes Fall Off”):

[ See post to watch video ]

Joe Nichols – Tequila Makes Her Clothes Fall Off

Dear Tim: Here's a Tour of the It-Takes-a-Licking-but-Keeps-on-Ticking AOL Brand

Kara Swisher — Tue, 28 Jul 2009 07:02:42 +0000

What’s next for AOL?

Reviving the “You’ve Got Mail!” motto?

Or: “The Future. Now Available.”–set to music from “The Jetsons”?

What about: “So easy to use, no wonder it’s #1!”

Or maybe, it should just use a nice loooooooong busy signal as its calling card again?

Well, it could happen, now that new CEO Tim Armstrong has fallen prey to the siren call of the AOL moniker, as have many–way too many–before him.

After years of seeing the company wander in the anything-but-the-AOL wilderness, Armstrong has decided to try to welcome the prodigal brand back home, even as he prepares to spin it off in November from Time Warner (TWX), trading on the New York Stock Exchange once again under the AOL stock ticker.

Thus, he has renamed the Platform A advertising unit AOL Advertising; changed its unfortunately named People Networks–which is made up of the communications and community properties–to AOL Communications; and done the same for its MediaGlow, which is now under AOL Media.

There is also in the new AOL-centric universe: AOL Local & Mapping and AOL Ventures, where all the bad acquisitions–like the Bebo social networking service–go to die.

While BoomTown admires Armstrong’s moxie, there is some dicey past history related to the AOL brand–which I lovingly call the “Christine” of the Internet industry–that he might want to be aware of:

* The start-up from which AOL first sprung was named Control Video Corp., which was founded to create a device that would allow users of the Atari 2600 videogame machine to download games over telephone lines.

* After it tanked, CVC was reborn in 1985 as Quantum Computer Services, which had offerings with names like Q-Link for Commodore computers and AppleLink for Apple (AAPL) Macintosh computers.

* In October 1989, the-AOL CEO, Steve Case, announced a company contest: What should Quantum rename its main online service?

The suggestions that came in—Crossroads, Explore and Infinity—sounded like drug treatment programs or new car brands.

Dismissing them all, Case offered a bland creation of his own: America Online, with a second option of Online America.

Other staffers understandably derided it as hokey, but Case essentially stuffed the ballot box and voted his suggestion the winner anyway.

Later, he would change it to just its initials, AOL.

* Case also hit on the idea of attaching voice files to the software with cheery little sound bites that would make the service feel homey.

The team settled on four phrases: “Welcome,” “You’ve got mail,” “File’s done,” and “Goodbye.”

A customer service representative named Karen Edwards had mentioned that her husband, Elwood, was a professional broadcaster, so for testing purposes, Case asked if Elwood might read those four phrases into a cassette tape.

The test tape was put into use, and Elwood Edwards, quite by chance, ended up having one of the most listened-to voices on the planet.

* In July 1993, AOL marketing chief Jan Brandt supersized the AOL brand by asking Case for permission to spend $250,000 on a direct-mail campaign.

She recalls him telling her it wouldn’t work. He told me in an interview he did no such thing.

Whatever the case, she got permission, and thus began the very low-tech marketing blitz of hundreds of millions of disks that would make AOL a household name—and annoyance.

There were even AOL disks flash-frozen in Omaha Steaks.

* In a 1993 meeting between Case and then-Microsoft (MSFT) CEO Bill Gates, annoyed by the innovative start-up, Gates famously told Case, “I can buy 20 percent of you or I can buy all of you. Or I can go into business myself and bury you.”

None of those ever came to pass, which is a reason to cheer the AOL brand. But–given Microsoft’s weak record in the online business–this is also not saying much.

* AOL’s brand has gone through a lot of name-calling, some of it quite deserved. Here are some: “The Online K-mart,” “America On Hold,” “The Giant Sucking Sound.”

But this one from its earliest days is my favorite: “The Cockroach of Cyberspace.”

* AOL did a lot of television commercials to hype the service, some of which you can see below. In one especially weird one, AOL hired Adam West of the goofy “Batman” television series.

* When AOL and Time Warner announced their merger on January 10, 2000, and renamed the company AOL Time Warner, AOL owned 55 percent and the combined market valuation was thought to be in the hundreds of billions.

Today, with Google (GOOG) selling back its five percent stake in AOL, AOL’s value has plummeted to about $6 billion. Time Warner is currently worth just over $33 billion.

* When Jon Miller–now digital head at News Corp. (NWS) took over at AOL in mid-2002, after said merger failed miserably and the brand was taken off the corporate name, he spent some time visiting the company’s other divisions, and related an anecdote to me that he’d told them, to try to help move the relationships forward.

“Have you ever had your car towed in New York?” he said he’d ask executives in other divisions. “When your car gets towed, there’s a sign at the place where you go to pick it up that says, ‘The person behind this window did not tow your car. If you cooperate with them, you will get your car back quicker.’”

Tim, Time Warner is still waiting for Christine to be returned, so good luck with that rebranding!

And, while we await the turnaround, here is a little video I did for Tim about my (lack of) AOL branding expertise with my assistant Ed, and also some of the better AOL television commercials:

[ See post to watch video ]

The $125 Million-Sweet DailyCandy Revenge of Bob "Pitchman"

Kara Swisher — Wed, 06 Aug 2008 13:55:09 +0000

Oh, there had to be much, much gnashing of teeth in the corporate offices of the Time Warner Center in New York yesterday with news of the sale of DailyCandy to Comcast for $125 million.

Why?

Maybe because that tasty payment is going right into the hands of Bob Pittman’s Pilot Group Ventures, which bought the fashion and shopping newsletter business for $3 million in 2003.

Longtime media exec Pittman was the former star AOLer, whose nickname was Bob “Pitchman” for his smooth-as-silk selling and even more marked spinning skills.

But the Web 1.0 supernova fell quickly to earth, after the online service merged with Time Warner (TWX) in early 2001, in what is now considered one of the more significant world-class corporate disasters.

After being tossed out of AOL Time Warner in mid-2002, Pittman (pictured here), along with AOL head Steve Case, was blamed for the stock decline and other woes at the media giant by the Time Warner side, whose deep bitterness toward him has never really faded away.

Now, with Time Warner trying to make a deal to sell the AOL unit for up to $10 billion to Yahoo or Microsoft–despite it being valued at $20 billion only a few years ago–Pittman’s small but impressive score has got to grate.

“I have been associated with the start-up, turnaround or acceleration of many companies and major brands, and rarely have I seen the kind of creativity, commitment and passion I’ve seen day in and day out at DailyCandy,” said Pittman in a letter to DailyCandy staff yesterday about the sale. “And the results speak for themselves: Since we made our investment in 2003, subscriptions have grown from just over 200,000 to over 2.5 million.”

In the letter, Pittman said the company’s EBITDA was over $10 million this year on revenues of $25 million.

This is certainly different from the situation almost exactly six years ago when Pittman was driven out of the then-named AOL Time Warner on the proverbial rail.

If you want a taste of those once-grim times for Pittman, here is an excerpt from my book, “There Must Be a Pony in Here Somewhere: The AOL Time Warner Debacle and the Quest for a Digital Future,” which was published in 2003.

The section comes from Chapter Six, “Way, Way After the Goldrush,” as the deal imploded:

THERE’S NO BUSINESS LIKE NO BUSINESS

Despite the troubles, Pittman, Case and [former AOL Time Warner CEO Dick] Parsons grinned out from the June 2002 cover of AOL Time Warner’s internal magazine, called Keywords, under the headline “Lift Off!” Actually, “Grounded!” would have been a more accurate headline, given the problems that would mount over the summer.

That was especially true at AOL, where Pittman found that just about everything–from morale to ad sales to subscriber numbers–was trending downward at an accelerating pace.

He had grown weary of infighting at the company, exhausted from the traveling and worn down by the prospect that turning around AOL would take more work than he had ever imagined.

For three months, he’d been trying to revive AOL while still working as COO of the combined company. Pittman was stretched about as thin as he could go, and AOL was still sputtering.

“He had been getting a pounding and he did not see a way to turn it around,” said AOL marketing whiz Jan Brandt, whom Pittman had brought back into the top echelons of the company upon his return. “And there was no end in sight.”

Indeed, for Pittman, there was no end in sight for the time it might take to fix AOL, especially because of how badly he and his team had alienated the entire Time Warner management.

The New York Post even began running a regular “Pittman Meter,” an obnoxious graphic that offered assessments ranging from whether he was “toast” to “safe” on any given day.

Mostly, Pittman was burnt to a crisp.

With increasingly skepticism that he could fix the problems at AOL, Pittman went to Parsons before the July 4th holiday weekend and told him he wanted out.

“I can’t do this anymore,” said Pittman to Parsons, who urged him to think things through over the weekend.

But the weekend put him over the edge, when the New York Times–whose reporter, David Kirkpatrick, had become a favored outlet for disgruntled Time Warner executives to vent—ran a scathing piece detailing Pittman’s failure to turn things around at AOL and suggesting there was a target on his back.

“Executives and shareholders are united in more or less open revolt,” wrote Kirkpatrick. While the story referred to discomfort with the departed Levin too, it singled out Pittman explicitly.

“Most of all, Time Warner executives have turned their ire specifically at one man–Mr. Pittman, a former America Online executive who became chief operating officer after the merger,” it read. “He angered many Time Warner executives with what they called his brusque manner … he developed a reputation for brashness, ruthlessness and success at America Online, and he applied the same tactics at Time Warner on his return.”

As if channeling the Time Warner side’s anger, Kirkpatrick summed up their message: “Now many executives from the former Time Warner wish the merger would go away, and, barring that, they wish that Mr. Pittman would.”

In the article, Parsons was quoted offering a rather tepid defense of Pittman: “People get angry and that anger has to be attached to something or someone,” he was quoted as saying. “Some of it has been attached to Bob and I am not sure if it is entirely fair.”

Well, not entirely, Parsons’s quote seemed to indicate to me–but maybe it’s a little fair! This deft response definitely did not look good for Pittman.

And with Parsons firmly ensconced in the CEO position and no place higher up on the ladder for Pittman to go, what sense did it make for him to keep fighting what was, for the foreseeable future, a losing battle in which he would probably end up getting tossed out anyway?

With the executive ranks blaming him and the board losing faith that he could turn AOL around, Pittman had no chance of regaining any credibility as COO.

“Pittman left on own steam, but he knew what was coming,” said one board member, who actually admired Pittman.

Pittman wanted to announce he was leaving, but Parsons asked him to delay the news until the board could approve a new management structure in mid-July.

His plan was to promote Time Inc.’s Don Logan and HBO’s Jeff Bewkes to the top of the AOL Time Warner structure, effectively splitting Pittman’s duties into two positions, both of which would report directly to Parsons.

Logan would head the Media and Communications Group, the subscription and ad businesses that would include Time Inc., Time Warner Cable, the Interactive Video Unit, Time Warner Books and AOL.

And Bewkes would run the Entertainment and Networks Group, made up of HBO, New Line Cinema, The WB, Turner Networks, Warner Bros. and Warner Music.

Getting the pair interested in the arrangement would be difficult, given the recalcitrance both had felt toward the merger in the first place.

But it was critical for Parsons to pull this off, since Logan and Bewkes were considered the best and most successful operators in the company, though they were vastly different in personality and style.

Logan, who had been the CEO of Time Inc. since 1994, was one of the most admired managers in the company, especially within his division, where he was openly revered for turning around the fortunes of the magazine publishing house.

An Alabama native, he was the son of a housewife and a welder for the state highway department. Logan went to Auburn University as a math major, and worked his way through school as a computer programmer for NASA in Huntsville. He continued his studies–specializing in abstract math–at Clemson University, and went on to pursue a doctorate part-time the University of Houston.

While in Texas, he worked for Shell Oil, creating research tools in the search for oil, but he found big-company life too slow.

Answering an ad for a Birmingham, Ala., publishing company called Progressive Farmer, later renamed Southern Progress, Logan worked first in data processing and fulfillment and later in direct marketing.

Time Inc. bought Southern Progress in 1985, and Logan was running it by 1986.

Admiring Logan’s reputation for consistent results, [former Time Warner CEO Jerry] Levin brought him to New York in 1992 as Time Inc.’s president and COO. Logan got the CEO spot two years later.

Logan fulfilled Levin’s expectations by goosing the magazine division’s results dramatically, turning in 41 consecutive quarters of earnings growth and tripling its cash flow.

Logan managed all this while affecting a folksy Southern image as a good old boy who just loved to go fishing. (He had even appeared on the cover of Field & Stream in a feature about jungle fish.)

Pretty much everyone I asked about Logan felt the need to mention his fishing, as if it were mysterious and complex part of his nature–imagine that, a fishing math major!

In the company newsletter, Logan was quoted as noting that business was a lot like fishing, in that they both require “persistence and patience.”

The burly Logan might have had true “down home” bona fides, but he was as smooth as any city slicker in leading the potentially divisive troops at Time Inc.

His greatest strength appeared to be in leaving people alone, yet demanding performance as a price for that independence.

“He was a straight talker in a culture of bullshit and platitudes,” said former Pathfinder executive Linda McCutcheon. “And he believed you grew incrementally to greatness.”

The very qualities that were so admired at Time Warner were derided by AOL’s top brass, who considered Logan a typical Time Warner corporate timeserver and not much of a risk taker.

“He thought growing at five percent a year was a great accomplishment,” said the voluble [AOL ad exec] Myer Berlow. “He was not exactly the kind of person who welcomed us.”

The AOLers expected more rapport with Jeff Bewkes, the glib and good-looking head of HBO.

Much as everyone mentioned Logan’s interest in fishing, the word Time Warner people invariably used to describe Bewkes was “handsome.”

And he is indeed a handsome man, slim and tall with a curious mix of Hollywood glamour and vague preppiness that suited the more conservative elements of the company.

“Golden boy” had long been a defining image for Bewkes, who was a graduate of Yale University and Stanford Business School (again, that heady mix of traditional East Coast and trendy California).

The impact he made was a strong one–an executive comfortable with both Hollywood talent and deal makers alike.

Bewkes came to HBO many years previously, and worked in the finance and marketing departments. He was considered a winner even in his earliest days.

“We all used to assume he would eventually be the boss,” said a former AOL executive Mark Walsh, who worked with Bewkes at HBO. “He had this air of the inevitable about him that was very appealing.”

His star rose quickly and he eventually became the chairman and CEO of HBO, building a close-knit team around him that was responsible for burnishing the somewhat dull image of the pay-cable channel to an edgy sheen with such huge hits as “The Sopranos” and “Sex and the City.”

This conspicuous success quickly attracted AOLers, who identified with Bewkes’s more outgoing style and considered his passionate, entrepreneurial nature akin to their own.

They could not have been more wrong about his regard for AOL, though–Bewkes was one of the first executives to complain internally and loudly about the idiocy of the merger deal.

He wasn’t shy about challenging Steve Case’s dreamy ideas of convergence in company meetings, and he could pull it off because his HBO success gave him such credibility.

Bewkes’s ability to move with comfort through all parts of the company made everyone assume that he was headed for bigger things.

That included AOL, which Bewkes was asked to fix in early 2002. It was a position he’d quite smartly turned down, obviously aware that grabbing onto that sticky situation would hurt him.

Pittman really had no choice in being the one to take on AOL–although I joked to him when he went back to Dulles that he’d just been handed a tar baby that he’d have a hard time pulling away from without damage.

That was finally clear when the company announced his departure–which had been widely leaked in newspapers–on July 18.

As usual, his public statement had an odd mixture of spin and truth to it.

“I’ve decided that after a new CEO is in place at AOL, I won’t return to AOL Time Warner as chief operating officer,” he said. “Having worked so hard to build the AOL service and brand, and after then going through the merger and the last 18 months, it’s time to take a break.”

Managers and staff at other company divisions greeted the news of Pittman’s departure and the ascension of Logan and Bewkes with joy.

“The Taliban have been routed,” joked irrepressible Time Inc. Editorial Director John Huey, in what was a common sentiment.

Finally, Time Warner had taken back the company from the horrible invaders. The gloating ran rampant.

Media pundit and New York columnist Michael Wolff, who had worked with Time Warner on its various failed Internet efforts, took a dim view of the glee in his “This Media Life” column.

Wolff correctly asked: What had Time Warner really won by purging Pittman–who walked away with a fortune–and where would that leave the company?

“Of course, taking it out on the guy who outsmarted you does not, in turn, make you smart,” he wrote in his slap-down style. “[Pittman] doesn’t hang around a disaster area. This is show business. If the show flops, you close it. Onward and upward.”

AOL’s early CEO Jim Kimsey, who had long been enjoying his retirement, was even more direct, dialing Pittman up on the phone.

“Is this the unemployed Mr. Pittman? Because this is the unemployed Mr. Kimsey,” he greeted Pittman. “Congratulations–you moved Osama Bin Laden off the front page!”

But while Time Warnerites rejoiced in their hope that the merger turmoil was finally over, the company’s troubles wouldn’t leave the front pages for a long time to come.

We’ll see if that has changed at all, after Time Warner announces its second quarter earnings later today.

Rumors of Jerry Yang's Dethroning Are Greatly Exaggerated

Kara Swisher — Wed, 07 May 2008 07:38:51 +0000

Off with the Yahoo CEO’s head!

OK, maybe not so much, at least today.

Indeed, according to many sources, Jerry Yang’s head still sits squarely on his neck.

And, moreover, his job as CEO has not been usurped by Yahoo (YHOO) Chairman Roy Bostock, who was allegedly–as one rumor went–authorized by Yahoo’s board, instead of Yang, to restart negotiations with Microsoft (MSFT).

(Which is kind of obvious when you actually think about it, given that Bostock is mired in this takeover collapse mess up to his own at-risk neck along with Yang. Bostock has been deeply involved all along and will likely continue to be.)

Thus, lots of smoke and little fire, contrary to rumor-based reports, like this one from TechCrunch–most of which seem to hang on the thinnest of threads (Where in the world is Yahoo board member Eric Hippeau?).

More importantly, even though they move share price, these rumors show almost no knowledge of how public company boards actually operate, which is to say with slug-like speed, even when under fire as Yahoo clearly is.

And if Yang were to go, I would guess it would be under his own steam or he’d be run out with Yahoo’s directors on a rail by angry shareholders.

Still, as a post yesterday of BoomTown’s book excerpt on the AOL Time Warner (TWX) debacle illustrates, even shoving aside a much-pilloried exec like former Chairman Steve Case, who presided over the merger disaster of all time, it took months and months and months and months and finally came well after the wheels fell off the bus there in a move made by Case and not his detractors.

And such a move to denude Yang, in the midst of the most trying time for the company, would make Yahoo’s board seem like particularly thickheaded morons–backing Yang strongly one day and throwing him overboard the next.

That is not to say Yang has not lost a mountain of credibility with Wall Street, investors, his own employees and in the industry in general, over the way he has handled the situation with Microsoft. The fallout from the debacle has damaged him badly.

The reviews are in and it is pretty much one million angry thumbs down.

Unfortunately, Yahoo’s leadership team has not exactly distinguished itself in the aftermath with their public statements, whether it be Bostock’s fanciful musings that Yahoo had the support of shareholders or President Sue Decker’s ungracious dissing of disgruntled Yahoo employees or pretty much the bulk of the backpedaling Yang has done.

And I don’t even know what to say about the excuse about the $33 offer not being written down as a problem by Yahoo execs, which makes them all move a little closer to Nearly Headless Nick in “Harry Potter,” in my estimation.

I do get their fervent need to explain themselves, especially in the face of such ferocious criticism.

But it has been so cringe-inducing to watch, that part of me wishes they would slink back into that cave Yang and his team have been living in all year long.

Obviously, Yang cannot and must now take the heat and find a way to clearly articulate a really good vision of what lies ahead for Yahoo.

That does not mean dangling the possibility of another deal with Microsoft to placate critics or pretending Yahoo wanted such a merger.

The very fact that Yang brought the painfully terse Yahoo Co-Founder and tech guru David Filo–who has fervently opposed a lot of Yahoo hookups in the past, like with eBay (EBAY) many years ago–with him to the key meeting last weekend with Microsoft CEO Steve Ballmer was all I needed to know to determine that the company did not want to sell.

So, Yang and the board got what they wanted–for now, at least–which is a very painful dose of independence.

If they want that to mean going back to talk with Microsoft, Yahoo should stop playing games and do so with a minimal amount of jockeying.

If it means making a series of bold moves to focus and define its business, then Yahoo should do that and quickly.

And if Yang can’t lead or is still lonely–he said last year of the CEO job, “It is a lonely job in the sense that you have to make some of the tough calls”–he needs to step aside for a new leader of Yahoo.

Because, even if Yang lives to fight another day, this much is clear: The clock is running down for him and his stewardship of Yahoo.

Yang is, as Dean Vernon Wormer of “Animal House” said so eloquently, on double secret probation.

So, if I were to predict, I would say six months without meaningful change is all he has.

And after that, I would imagine, is when the blade really starts really falling.

A History Lesson for Jerry Yang: It Sticks in My Craw(ford)

Kara Swisher — Tue, 06 May 2008 09:34:41 +0000

Yesterday, the powerful portfolio manager at Yahoo’s largest investor, Gordon Crawford (pictured here) of Capital Research Global Investors, a division of Capital Research & Management Co., made some very public and very harsh remarks directed at Yahoo (YHOO) CEO Jerry Yang for blowing the Microsoft (MSFT) deal.

All told, between two funds, Capital Research owns 16% of Yahoo. The fund run by Crawford, a legendary money manager and media power broker, holds 6% of that total. No surprise, then, that those funds took a big hit yesterday after the Microsoft takeover bid for Yahoo collapsed.

So a lot of people paid attention yesterday when Crawford, in a high-profile interview with The Wall Street Journal, laid into Yang (pictured here) in such an in-your-face manner.

Said Crawford: “I’m extremely disappointed in Jerry Yang. I think he overplayed a weak hand.”

Crawford was fuming even more to the New York Times yesterday:

“I am extremely angry at Jerry Yang and at the so-called independent board. … I’m hoping that there is such an outpouring of outrage that the board is embarrassed into revisiting this thing, but I’m not optimistic about that.”

Uh-oh, because BoomTown has seen this story before.

It was back in 2002 and the exec under Crawford’s withering gaze then was former AOL Time Warner (TWX) Chairman Steve Case (pictured here).

Jerry Yang might want to take notes, as the situations are a little too familiar to ignore.

Thus, here is a longish excerpt from my book, “There Must Be a Pony In Here Somewhere,” which shows just how active and relentless Crawford can be as an investor when he gets irked by execs who disappoint him:

Gordon Crawford was still very, very angry.

Still piqued over the deteriorating situation at AOL Time Warner, he was now annoyed at himself too.

After laying into AOL Time Warner CFO Wayne Pace in early 2002 over what he perceived was dissembling by COO Bob Pittman and former CFO Mike Kelly in 2001, the powerful media investor at Capital Research and Management had decided over the spring to continue investing in the company.

He had visited the online unit and been heartened that executives were hard at work on a solution, even as the other divisions of the company were excelling and new CEO Dick Parsons had boosted morale.

Crawford calculated that the stock price had fallen well below the potential breakup value of the various parts of the company, and he had decided the stock of AOL Time Warner was being beaten down unnecessarily.

It now seemed a good buy. After all, how much worse could things get?

A lot, actually, as the online unit continued its downward spiral with new accounting allegations revealed over the summer and more signs that both subscriber numbers and ad revenue were in trouble.

Crawford would later kick himself for ignoring the signs he had flagged earlier.

“When there was one cockroach, one should always assume there are others,” said Crawford to me in 2003. “It was a stupid mistake.”

And Crawford wasn’t going to make another one, especially after he began hearing more and more angry voices from his network of sources across the divisions of AOL Time Warner.

Almost all the complaints were centered on one person: Steve Case.

After Levin and Pittman had left, it seemed, Case had begun to reassert himself at the company, visiting various divisions and doling out guidance on how to better achieve synergies.

It was advice that few divisional executives welcomed, especially coming from the man they held most responsible for the huge declines in the company fortunes, and who was also a constant reminder of how Time Warner had been snookered.

“To have to sit there and listen to him was unbearable for them,” said Crawford. “His continued presence was taking a terrible toll on morale.”

As the protests mounted, Crawford took it upon himself to gather key allies among the big shareholders–beginning with Ted Turner, who had now soured on Case much in the same way he had on Levin.

Crawford then contacted Malone, who had wanted to stay neutral but agreed to hear them out in an August visit to Denver. There, Crawford and Turner made their argument to Malone.

“Their view was that it was a disaster and no one could stand to have Case around,” recalled Malone. “The numbers lost were just too big, so he had to go.”

Lingering in the background, noted Malone, was the sense that Case had outsmarted everyone at Time Warner, a fact that further grated on them.

Since Crawford was headed east to New York for a series of meetings at various media concerns, including AOL Time Warner, the trio decided that he would be the one to deliver the news that Case should go.

He first met with Dick Parsons and Wayne Pace on on other topics at the company’s Rockefeller Center headquarters. During the meeting, Case joined the group and invited Crawford to his office when he was done for a private talk.

Case might have reconsidered the invitation when he heard Crawford’s definitive message: Resign.

Outlining his feedback from employees, Crawford explained that neither he nor other major shareholders thought Case could be an effective chairman any longer.

Case, sources familiar with the conversation said, was shocked by Crawford’s frank assessment and began immediately to argue with him.

Crawford was stunned when Case told him AOL was fine before the merger announcement and that he had no responsibility at the company after the deal was done.

It was not his fault that the economy had tanked. It was not his fault that both Levin and Pittman had proved to be unsuccessful leaders. It was not his fault that the Internet boom had turned to bust.

Case told Crawford he was not leaving.

The meeting ended with Crawford deeply troubled over Case’s finger pointing at everyone but himself, and the casting of himself as victim.

The gall of it rankled the longtime investor, who expected people to take responsibility for their errors. Yet Case hadn’t made even a slight effort at any kind of apology, claiming he either was not in control or not responsible.

What Crawford couldn’t grasp was that Case had no intention of saying he was sorry when he was not. To Case, offering a mea culpa would have been dishonest.

In addition, he felt it was more useful to figure out what to do next than wallow in blame. This was vintage Case, a behavior of moving on and compartmentalizing failure that had served him well for so long.

Case felt he had little authority to do anything, but a lot of responsibility to get it right.

Case called Crawford soon after he returned to his California office. “How can we patch things up,” asked Case.

But Crawford’s message was the same: “We can’t.”

Still, in the same conversation, Case asked Crawford to discuss the situation further in person when he’d be in Los Angeles on a visit to Warner Bros. in September.

He and Crawford, along with AOL’s Donn Davis and Capital Research and Management’s David Siminoff, decided to have lunch at a private executive dining room at the film studio in Burbank.

Case was nervous as they sat down, and he quickly said that he wanted to find a way to return to a productive relationship with Crawford.

“What do I have to do to become friends again?” Case joked.

He noted that he cared deeply about AOL Time Warner and wanted to rebuild value.

But then he again asserted that the blame for the failed merger was not his, since he wasn’t the one running the show at either AOL or AOL Time Warner.

To Case, this made sense–there were a lot of mistakes to go around, but all that mattered was where the company was now and what it should do to fix matters.

Case had no idea how badly he had misread Crawford, who wanted neither a friend nor excuses about leadership deficiencies nor lessons about the here and now.

Crawford understood that executives made mistakes, and he even thought it was OK to miss numbers—as long as you had the guts to admit that it was your fault and you didn’t point fingers.

Crawford told Case that he didn’t hate him and didn’t want to be accused of going behind Case’s back to get what he wanted as a major investor, as he began to talk to AOL Time Warner board members and shareholders about his concerns.

Crawford didn’t have a whole lot to add to what he had previously said.

And that was: Resign.

Case didn’t have much to add to his prior response, either: He would not.

…Crawford had been calling major investors since the late summer. Already, Crawford had Turner, Malone and many others on his side, including some AOL Time Warner board members.

As 2003 dawned, he was not going away in his quest to unseat Case and he probably held sway of at least one-third of AOL Time Warner shareholders.

“Case was an irritant, especially in a managerial role,” said Crawford. “He hurt the esprit de corps–you can’t be the general when your troops want to shoot you in the back.”

Another person close to Crawford offered a more descriptive take on the media investor’s motivations.

“He did not do it to embarrass Steve,” said this person. “Steve was just a festering boil at AOL that needed to be cauterized and removed.”

Note: Case resigned on Jan. 12, 2003.