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Thursday, Nov 26, 2009
I don't know -- I'll have to check AOL's stock price and get back to you.
Jan 14, 2003 |
Conventional wisdom has it that Steve Case engineered one of the greatest business coups of all time when, just before the dot-com bubble popped, he bought media behemoth Time Warner with America Online's inflated stock. Two years later, conventional wisdom holds that Time Warner shareholders -- victimized to the tune of a $200 billion drop in "market value" -- were royally screwed by Case, who announced on Sunday that he is "stepping down" as chairman.
So, two years ago, Steve Case was a masterful executive -- but today, not only is his greatest triumph actually a failure, but press accounts regularly portray him as clueless, ineffectual and irrelevant to the day-to-day operations of the company.
The turnabout resurrects ancient memories from the mid-'90s, when the Internet old guard gaped at this bland, platitude-spewing former Procter & Gamble salesman and said, no way, this guy can't possibly get the Internet. AOL will never succeed, rose the cry, especially under the leadership of someone as clearly unexceptional as Steve Case. If Bill Gates didn't eat his lunch, the Internet surely would.
The Internet naysayers, as Wall Street Journal reporter Kara Swisher took pains to point out in "AOL.com," her 1998 panegyric to all things AOLish, got it wrong. As Swisher's subtitle hammered home -- "How Steve Case Beat Bill Gates, Nailed the Netheads, and Made Millions in the War for the Web" -- AOL and Case ended up on top. We were all fooled! Case's bland exterior was a wily façade beneath which lurked an extraordinarily effective corporate warrior.
So who's the real Steve Case, and what is his legacy? Is he one of the great businessmen of our time, forever resculpting the landscape of corporate America? Or is he the boardroom equivalent of Forrest Gump -- someone who just happened to be in the right place at the right time? And after this latest setback, what next? Is Case lying low, in wait for his inevitable comeback? Or is he, having finally risen to the point where he was clearly out of his league, kaput, once and for all?
The answer may depend on how much one accepts "market value" as the be-all and end-all for assessing corporate excellence. If there's one thing that everyone seems to agree on, it's that the fall in AOL Time Warner's shareholder value doomed Case. But to anyone who was awake during the dot-com bubble, the very idea that stock prices have some connection to actual value is preposterous. Market value is mob psychology. As any value investor will tell you, the time to buy is when the stock price is low compared to what you believe the real value of a public corporation to be. What are the company's long-term prospects?
Steve Case's personal "market value," right now, would appear to be at an all-time low. But the guy, judging by his demeanor and rhetoric, is exactly the same as he's ever been. The message, then, is clear: It must be time to buy -- someone hire this guy, pronto!
