Aol Time Warner Merger

1220 Words Apr 26th, 2011 5 Pages
versailleAOL Time Warner Inc. – A Bad Idea from the Start? 1. What are the opportunities and threats facing AOLTW (PESTEL analysis)?
Pestel analysis: | LOCAL | NATIONAL | GLOBAL | POLITICAL | | The antitrust law is rising. | The government wants to have a more powerful control to avoid monopoly. | ECONOMIC | For AOL it was the top of the internet boom. | The economy start to be hard and slow, as show the problem that warner is facing. | AOLTW will take the explode of the internet bubble really bad and problem will start | SOCIAL | With the boom of the internet the new companies are really young and dynamic created a new corporate culture. | The old media as Warner (television, movie and press) is facing some
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* Style: the management style is causing a lot of trouble because the two company have two different style. And a lot of TW executives didn’t approve the AOL management.

The strengths of AOLTW are: -Leading market position -Diversified product : online, cable, filmed entertainment, network services, and publishing -Strong brand equity

The weaknesses of AOLTW are: - Filmed entertainment division lagging behind other business units -Heavily US dependent

The company core competences are: for AOL is the Internet. For Time Warner is video broadcasting. Together, the best core competence could be communication. With the VRIO model we can analyze this core competence, Value: the firm can exploit the opportunity of the merger to mix their core competences, their capacity and resources to neutralize the threats. Rarity: is a problem because there is a lot of competition so the service is not rare. Imitability: same problem with the rarity a lot of companies are like AOLTW but the merger can be the leverage to differentiate the company. Organization: is the main issue of the merger Is the firm organized, ready, and able to exploit the resource/capability

4. What are the keys to success in AOL Time Warner Inc.?

5. Discuss the

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