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You've Got Sex


From the beginning of the merger, I thought this was going to be an interesting cultural problem. The AOL guys had always managed to keep the dialectic finely in play -- encouraging dirty chat by encouraging family values. Profiles to foster "community" and multiple screen names for family use and parental controls to create clearly marked areas of menace (otherwise, it was hard to find this stuff) served its porn business as well as its family image.

But this is not something you would have explained to the Time Warner guys.

I'm pretty sure nobody from AOL ever sat down at a Time Warner boardroom table and spelled out the workings of the autoeroticism business.

And count on it, the Time Warner people, those uptight guys, didn't ask.

What's more, I think the higher-up AOLers suddenly, given the opportunity, didn't want to be in the sex business anymore either. They'd all made hundreds of millions -- now they wanted to be respectable.

Classically, nobody was minding the store.

Now, AOL's problems are always blamed on the AOL people -- they were the flimflammers who got everybody into trouble. And they certainly were the flimflammers -- always playing a bit of bait and switch, always cooking the books a bit.

But the Time Warner guys were not only the guys who got duped but the guys who couldn't even see the real value of what they had: a monopoly on dirty chat. Possibly the greatest growth industry of the age.

The AOL problem is in some ways similar to the CNN problem.

The CNN reason for being became less and less clear after it was taken over by Time Warner. The outsider identity got confused. The scrappy thing suddenly seemed ridiculous. The tone went off.

Likewise AOL, which had this canny sense of what Americans wanted to do in the privacy of their own computers, stopped having it.

Stepping into the time machine:

In 1994, I was a consulting member of a four-man committee at Time Warner that made two decisions.

The first decision was not to buy AOL. Among the considerations was that AOL was so unique, and its route to success so eccentric, and its understanding of the relationship of technology to culture so quirky, that Time Warner, with its heavy-handed, unquirky literalness, could be counted on, in the estimation of Walter Isaacson, one of the committee members and now the chairman of CNN, "to screw it up."

The second decision was that Time Warner would start a Website of its own which would be built around what everyone considered to be the Time Warner mother lode of irresistible content -- it had People magazine! With some prescience, the Time Warner people, who know a thing or two about advertising, correctly surmised that advertising was not going to support the Internet. And so the plan was to sell users Time Warner content. (In my personal defense, I kept talking about what a dirty place AOL was -- that the Internet was the porn business. But the feeling seemed to be that, first, I was joking and, second, while new entertainment technologies often started dirty, they soon became much more sanitized and mass-market.) This service, which started in the autumn of 1994 and closed in the spring of 1999, was called Pathfinder and proved two things: Selling Time Warner content on the Internet was pretty much a nonstarter, and the people at Time Warner lacked a certain flair for the Internet. We just don't get it, they said. Which was the essential reason for merging with AOL.

Now, in a fascinating and comic turn of events, AOL has come full circle to an idea that eerily resembles Pathfinder.

Most of the core AOL executives have departed (although Steve Case's picture has recently returned to the opening screen, exhorting the faithful), leaving the Time Warner people, with all their inhibitions, in charge.

It is unlikely that they have spent much time in the Long Island Swingers chat room in the Special Interests chat area, or given much thought to building a business to cater to those special interests -- that is, pursuing the business that AOL created and until recently dominated.

Instead, the Time Warner guys, in some remarkable demonstration of human and corporate steadfastness, have announced that they are going to save AOL by transforming it into a business that sells Time Warner content. For a premium, you'll be able to read People online!

Forgive me . . . ROTFL.


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