Examine the biggest failures in business to learn the secrets of success
April 7, 2015
In business, there are a whole host of examples of success and how to achieve it.
However, sometimes you have to look at the failures before you truly learn something. So sit back and read some stories about blunders and flops.
AOL/ Time Warner Merger
This has become one of the top textbook references for failed mergers. In the early 2000s Time
Warner was one of the powerhouses in global ‘traditional media’. AOL had grown to become the largest internet portal in the US with 35 million users.
Then, both got the idea that merging the old with the new would mean big success for both. That new success had its price tag and in 2002 the largest merger in American corporate history was estimated at $350bn (€320bn).
The merger was based on the premise that AOL’s growth would largely be underpinned by advertising revenue. Soon after the merger the dotcom bubble burst and AOL went into freefall.
The merger soon became cancerous to both companies, $100bn was wiped from the stocks. So what happened to AOL? It got spun off as a Time Warner company towards the end of the decade. In researching this article I went to AOL for the first time in about 17 years. You can still use it to search for content on the internet, but the symbol to the right of search denotes that it is ‘powered by Google’.