-------------------------
Via Workers World News Service
Reprinted from the Jan. 20, 2000
issue of Workers World newspaper
-------------------------AOL-TIME WARNER MERGER
Can new media conglomerate monopolice the Internet?
By Gary Wilson
The Time Warner-America Online merger, if it goes through, will be the biggest corporate merger in U.S. history.
America Online is the top Internet service provider in the U.S. Time Warner is one of the biggest media and entertainment conglomerates in the world. The combined company will be called AOL Time Warner. By putting AOL first, the new name emphasizes that the company will be the top "dot com" company in the world, with an Internet audience of 47.1 million, according to Nielsen/NetRatings.
The Internet is a technological revolution that has introduced vast changes, from the point of production to final consumption. Its impact will probably be bigger than that of the railroad, or mass production of automobiles.
It is new enough that what will happen in the future is really unknown. The situation has some similarities to the automobile industry at the time mass production was first introduced. There were hundreds of companies building cars. None knew what was coming in the future.
The Internet's biggest impact so far remains mostly unrecognized. It has completely revolutionized how business operations are carried out, from internal communications to sales and business-to-business commerce.
What has gotten the media headlines is the growing use of the Internet for personal use, from email to purchasing consumer goods to entertainment.
The AOL Time Warner merger is meant to dominate this personal use of the Internet.
The problem is that the nature of the Internet does not lend itself to being dominated. Probably no technological revolution has been so purely socialist in character as the Internet.
It relies for its existence on the collective cooperation of a vast army of computer workers worldwide. It is the greatest cooperative in human history. But that has not prevented efforts to privatize it, to force it to fit into the corporate capitalist model.
Both AOL and Time Warner have attempted to do this. And failed.
AOL is in trouble and its future was looking bleak. Dialup Internet access is certain to disappear in the future and with it will disappear AOL as it is now known. AOL needs the Time Warner merger to survive.
AOL charges a premium for its service, which gives access to its private network and limited access to the Internet. But it is unclear how much longer that business can hold out. Free email and Internet dialup access are being widely offered from services that provide it along with advertising. AOL also has advertising all over its Web pages, but it makes the customer pay for seeing the ads.
The free services are starting to cut into AOL's business and will probably come to dominate whatever is left of the dialup market until faster access methods completely take over.
For frequent users of the Internet, neither AOL nor the free services are desirable. Frequent users are turning to faster Internet access providers, primarily through cable modems and DSL connections. As AOL works now, users with these connections cannot get AOL service.
Time Warner is one of the biggest cable operators in the country and it is providing cable access through its Roadrunner service. Its CNN Web site is one of the most accessed news sites on the Internet. But its attempt to sell access to its magazines through its Pathfinder Web site was a complete failure.
Time Warner never found a way to make money by charging for the content of its magazines on the Web. Pathfinder has been completely abandoned and the contents of magazines like Time are now freely available. But Time Warner hasn't given up on the idea of wanting to charge Internet users for something that right now everyone is getting for free. By combining AOL and Roadrunner, it hopes to do that.
Can this media conglomerate cram the new technology back into the corporate box? Or will it escape into the cooperative realm of cyberspace? Stay tuned. Or online.
This article is copyright under a Creative Commons License.
Workers World, 55 W. 17 St., NY, NY 10011
Email: ww@workers.org
Subscribe wwnews-subscribe@workersworld.net
Support independent news http://www.workers.org/orders/donate.php)HOME :: U.S. NEWS :: WORLD NEWS :: EDITORIALS :: SUBSCRIBE :: DONATE