AOL Chairman Quits Following Shareholder Unrest

Steve Case, the beleaguered chairman of AOL Time Warner, has bowed to increasing pressure and announced his intention to step down in the spring.

This development comes on the back of revelations that the world’s largest media company will be forced to take a charge of at least $10 billion as a result of writedowns in the value of America Online. This comes on top of a $54 billion charge in the first quarter and advertising and e-commerce revenues at the internet division are expected to fall by up to 50% in 2003.

Case was one of the main drivers behind the merger of AOL and Time Warner at the start of 2001. However since those triumphant days, the share price has slumped by 70% in difficult market conditions and the company has been accused of accounting irregularities.

A few months ago Case vowed to take a more active management role but he has come under repeated criticism from investors and decided to full on his sword rather than continue to face the music.

In a statement he said that the company “does not need distractions at this critical time and given that some shareholders continue to focus their disappointment with the company’s post merger performance on me personally, I have concluded that we should pull together as a team and focus fully on our businesses.”

Richard Parsons, currently chief executive of AOL Time Warner is favourite to take over from Case who will remain on the board after relinquishing his post in May.

Subscribers to MediaTel Insight can access more national and international media analysis, forecasts and news by visiting the site.