Don Logan: Black-Hole Filler

Position: Chairman, Media & Communications Group, AOL Time Warner

Contribution: Built Time Inc. into the largest, highest-grossing magazine publishing business in the country

Challenge: To resurrect the fast growth America Online once enjoyed

Don Logan wasn't the obvious choice to oversee the turnaround effort at America Online, the now-struggling Internet service provider with 35 million members worldwide. As chairman of AOL Time Warner's (AOL ) magazine division since 1994, Logan, who's cut from traditional publisher's cloth, once famously referred to the Internet as a financial black hole.

So much for wisecracks. With his recent promotion to head AOL Time Warner's newly formed media and communications group, Logan oversees not only Time Inc. but also Time Warner Cable -- and, incidentally, America Online. He's one of the two highest-ranking operational executives in the company, reporting directly to AOL Time Warner CEO Richard Parsons.

Logan, 58, is credited for turning Time Inc.'s stable of slow-growth magazines into the highest-circulation, top-grossing publication group in the U.S.. Now comes a bigger challenge: America Online still represents about 20% of sales and operating income for the parent company, but revenues and earnings are slipping fast. In the most recent quarter, America Online's operating income dropped 41%, to $473 million.


  Porter Bibb, founder of Technology Partners Holdings, a media consulting company in New York, says Logan's success depends upon "migrating those millions of members to faster broadband Internet access without losing the core subscription revenues." Logan faces this challenge even as Microsoft and several cable and phone companies are creating their own high-speed Internet services to compete with AOL.

A formidable task indeed, but people close to Logan say he's up to it. A native Alabaman who is an avid Auburn football fan, he eschews political infighting -- even at a company legendary for its backbiting and turf wars. "He's a master of cutting through the bull," says Bibb.

Logan is exceptional in another way for a publisher: He has an undergraduate degree in mathematics and worked at NASA as a computer scientist briefly before entering the publishing business in 1970. According to colleagues, Logan's 32 years in magazines and direct marketing have given him a keen awareness of what drives circulation and subscription growth.


  One of Logan's protegés, Time Inc. Executive Vice President John Squires, calls him a maestro at bringing organization to where it's needed most. "It's clear now that the matrix management at America Online didn't work very well. Don Logan gets organization. He knows how to create a management organization that can thrive. He develops clear lines of responsibility that allow people to make actions quickly."

It will take all the deft management and organization Logan can muster to regain the edge that America Online has so abruptly lost this year.

By David Shook in New York

    Before it's here, it's on the Bloomberg Terminal.