Is the recent truce between Microsoft and AOL Time Warner really that meaningful?
Listening to many commentators laud the settlement, with which the companies pledged to work more closely on instant messaging interoperability and Microsoft wrote AOL Time Warner a check for $750 million, one might think this is the biggest news since the invention of the World Wide Web. Analysts swooned. The Seattle Times predicted that the “settlement could once again transform the industry–and potentially change the way consumers buy music, movies and television service.” The New York Times believes that the deal “reflects a fundamental change in direction for both companies.” Well, it might. But it’s pretty unlikely. Remember the excessive bloviation that accompanied the January 2000 announcement that America Online was buying Time Warner? Analysts confidently predicted that that flop of a deal would change the business world as we knew it. Bear Stearns financial analyst Scott Ehrens said at the time: “Since we view it as the premier company in one of the hottest sectors in the m
