Other key data points from Time Warner’s (TWX) Q4 report card:

Overall revenue at AOL dropped 23 percent (the remainder of the decrease stems from AOL’s evaporating but still substantial dial-up business). But operating income, before accounting for a gigantic write-off the company had preannounced, actually increased six percent. So if new sales boss Greg Coleman, last seen at Yahoo (YHOO), can make even modest progress in the next couple months, AOL will be able to limp along for a bit longer.

But not before more overhauls: Time Warner announced that it has earmarked another $250 million for restructuring charges at AOL and its Warner Bros. movie studios in 2009.

Time Inc.’s ad revenues dropped 20 percent, and adjusted operating income dropped 70 percent. But you can’t pin all of that on Ann Moore and company: Time had to take a $57 million charge on rent that Lehman Bros. (R.I.P.) won’t be paying to lease space at the company’s midtown office.

TIme Warner’s network TV business–HBO and Turner Broadcasting–did just fine. Gangbusters, really, by today’s standards: Revenues were up nine percent, including a seven percent bump in ad revenues.

Want to see the numbers for yourself? Click the table below to enlarge, or read the full release:

To review: PHTN holders on Friday approved a pending $15.60 a share cash takeover of the company by Orbotech (ORBK), an Israeli-based rival in the LCD display equipment business. But the stock yesterday hit an air pocket, dropping $2.19, or 14.5 percent, to $12.89, and trading as low as $10.74. I theorized that the drop might have had something to do with the role in the deal played by Lehman Bros., which has been an adviser to Orbotech. Late in the day, the company issued a release which said that the only hurdle left to completion of the deal is approval of the transaction by the Committee on Foreign Investment in the United States. Photon said CFIUS is supposed to respond by Sept. 29, and possibly sooner.

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Not BoomTown.

And it is not because newly crowned CBS Interactive CEO Quincy Smith (pictured here) is the ever-amusing Energizer Bunny of the Internet.

Okay, CBS (CBS) paid too much and that makes the whole thing suspect. But is it the wrong direction?

I have been noodling on the deal for a while now and have concluded that I like it.

Why? Primarily, because it is a big bet on big traffic from a high-quality Internet-born content and video site, which has been unnecessarily pilloried much as much, much smaller Web 2.0 competitors have been over-hyped.

With a hard re-haul–and there is no question CNET has to shake the Web 1.0 tone out of its system–and a true effort to find new advertising paradigm, the site could be just the kind of proof that content on the Web can really be powerful and more lucrative.

That’s because size still does matter. CNET is a midsize network of sites–smaller than Yahoo, but much bigger than most, with a range of sites, such as the popular GameSpot (see chart below).

Solving all of CBS’s problems is not the end game here, nor should it be, which has been the tone of a lot of the coverage of the deal. That’s been especially true as the media giant’s shares have swooned.

Struck in mid-May and closed at the end of June, the union has not inspired a lot of cheering by either Wall Street or the media, neither of whom like the 22-times EBITDA price (compared with CBS’s own seven).

Typical was The Wall Street Journal, which slappity-slapped the deal–comparing it with a lackluster CBS Web deal from a few years ago when the network bought CSTV for $325 million–and even managed to insult CEO Les Moonves’s ancient acting career at the same time:

“CBS Corp. Chief Executive Leslie Moonves had a bit role in ‘The Six Million Dollar Man’ in 1977, but never made it as an actor. So maybe it’s time that Mr. Moonves stop acting like an Internet dealmaker.”

More recently, Lehman Bros. (LEH) Anthony J. DiClemente, in a longer report about CBS’s stock, noted that the deal’s impact was questionable.

He wrote: “In our view, it may take several quarters before we are able to discern if CBS’s purchase of CNET is able to help the online monetization effort for CBS and its TV content. We believe CBS will need to rejuvenate the CNET brands and ad sales effort in order to earn an adequate return on invested capital. CNET’s platform may open up a new collection of advertisers for CBS’s Internet ad sales team.”

Well, exactly. As always, the issue is going to be all about execution, making integration go smoothly and getting its ad sales team to actually begin to sell across all CBS online properties in new ways.

But what should be not lost here amid all the bellyaching about price and the depressed CBS brand and its even more depressing stock is that someone has to begin to build the next generation media model and create a critical mass of high-quality display inventory that also attracts a large and demographically attractive audience.

In other words, all the pieces are in place at CNET and CBS to do this. Whether the Energizer Bunny runs out of power before that can happen is another question altogether.

Please see this disclosure related to me and CBS.