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How MicroHoo can avoid the fate of AOL-Time Warner

One thing was certain on almost every story I covered in the late 1990s as the Internet policy reporter for Reuters in Washington D.C. No matter what the controversy, the cable television industry would be on one side, led by Time Warner, and Internet companies would be lined up on the opposite side, invariably led by America Online. The very biggest dust-up was over “open access,” or the notion that the government should require cable companies to let other internet service providers access customers via their emerging broadband cable networks — just like the government required of the telephone companies. The fight was lengthy and bitter. But when Steve Case and Gerald Levin famously unveiled their almost $200 billion megamerger, it looked like the war was over. I even appeared on CNN with Judy Woodruff and said so. Oops.

Only later did we learn the shocking truth — Levin hadn’t shared the merger idea with most of his top managers and had done nothing to sell them on it. The very first move I expected, the death of Time Warner’s woeful RoadRunner ISP and the elevation of AOL as THE premier broadband service provider of the 21st century, never happened. Time Warner could then have pitched the model to other cable companies and spread high-speed AOL everywhere featuring TW content. Instead, inside AOL Time Warner, the two sides continued fighting and refusing to cooperate. All that great Time Warner content that could have helped AOL become a top destination for online video, all those AOL customers ready to make Time Warner content insanely popular online, all squandered. And now, eight years later, they’re dumping AOL’s dial-up service and HBO is just barely on the Internet.