AOL and Time Warner: the next evil empire?

· Aug 2, 2001 Tweet

A while back, I wrote about how the recent ruling that Microsoft was a monopoly would be a victory for consumers. As the case is being settled, pundits have started to look for the company that will inherit the title of ‘evil empire’ and many have arrived at the same answer: AOL Time Warner.
But before I continue with this article, I wanted to state a caveat: I have a deep admiration for certain parts of this company. I have no love for AOL itself, though I use AOL Instant Messenger now and then. However, I do browse the Web with a Netscape browser, get travel directions from Mapquest (yes, it’s an AOL company too) and communicate with friends through ICQ (another AOL company).

On the media side, I think The WB is the best television network ever to appear on television for younger audiences and Warner Bros studio produces some really good shows for the big and small screen that everyone can enjoy. Time magazine is still an influential periodical and DC Comics publishes my favorite hero, Superman, and team, JLA. Finally, there are the Turner companies, with cable television giants CNN, TNT and Cartoon Network (Powerpuff Girls rock!).

So, given my love for this media behemoth, one would then assume that I don’t think that it can be an evil empire like Microsoft. And I’d agree with you — partially. I think the phrase ‘evil empire’ refers to something that is so huge and powerful that it pervades every fiber of society but doesn’t contribute back equally to benefit society. Others may have a simpler and more frank definition that any company that grows to gargantuan proportions is necessarily evil because consumers have no choice but to use its goods and services.

I think that that is too simplistic an understanding of what an evil empire is. If that really was the case, then large companies, like banks, utility companies and even clothing stores, would be evil empires because a larger proportion of consumers would use their goods and services than at smaller companies. But then we’d have to decide where to draw the line between large and small companies. Revenues and profits would give an indication of a company’s size, but it would ignore how much that company contributes back to its employees’ welfare and the community, both of which benefit the population because it provides resources that normally wouldn’t be available.

Besides, a large company can be good for consumers too. With more resources to work with, it can provide a wider range of goods and services to consumers. In AOL’s case, this means that comic buffs can watch Superman in a big budget movie after reading a review in Time magazine and then discuss it with other fans through AIM. This synergy is, to me, synonymous with the way software companies bundle different programs together to make a user more productive, like Microsoft bundling Internet Explorer with Windows and Apple bundling Mail with Mac OS X.

On the other hand, this locks consumers into using AOL’s products only, which gives it the potential to become a monopoly like Microsoft and thus justify its inheritance of the evil empire label. However, in a capitalist society, companies have no choice but to generate profits to attract more investors and boost their stock price. The easiest way to do so is to charge consumers more to use their products. And the easiest way they can charge higher prices is by becoming so large that consumers have no choice but to use their products.

This is a gross oversimplification of the entire economic process, but it brings out my point. Once, AOL Time Warner was separately a small network service provider, cinema studio and publishing company. Today, by merging, it has become a multimedia conglomerate that generates millions of dollars in profit annually. I am disgusted with the way it hoards this obscene amount of money at the expense of consumers. I would feel better if AOL invested a large proportion of its profits into society, for instance, through welfare programs and public improvement programs. After all, since it has taken so much from consumers, it is perhaps only right that it should give back just as much.

Thus, in its current incarnation, AOL Time Warner has the makings of an evil empire given its huge economic base, product dominance and pervasion through society. While I appreciate its wide array of products that make life more entertaining and informative that only an empire can provide, I believe that it should do more to contribute more to society. Perhaps if it changed its image into one that is more caring rather than conquering and backed it up with active community involvement, then people would be more receptive to and approving of it. After all, if we can have an evil empire, why not a benevolent one too?


This article was published Aug 2, 2001 at 12:00 am and last updated Aug 2, 2001 at 12:00 am


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