MEDIA BRANDS: AOL Time Warner's brand equity will likely stay the same even with its name change

The news last month that AOL Time Warner's powers-that-be are considering a name change that would drop the troubled online division from the corporate moniker came and went like a fierce but brief August rainstorm. At press time, published reports considered the move a certainty.

The news last month that AOL Time Warner's powers-that-be are considering a name change that would drop the troubled online division from the corporate moniker came and went like a fierce but brief August rainstorm. At press time, published reports considered the move a certainty.

Such a change, driven as it has been by the online division, is symbolic on many levels. Not only is it another dagger in the heart of the infamous merger, now widely regarded as one of the most disastrous moves in US business history, but it's another nail in the coffin of the fin-de-siecle dot-com optimism that already seems to have died a thousand deaths. More than anything, this is an occasion to reflect on the merger's failure and, more broadly, the irrational exuberance of those days, which still has emotional resonance in a struggling economy. The move will inevitably be evaluated as a PR play, designed to help bolster the media empire's image, tainted as it's been by AOL's shaky business model and shady business tactics. A key question remains: What would a return to the Time Warner name, which itself invokes a not-too-paltry sea of holdings, from magazines to films to music to cable, mean to the value of the company's brand? Not a lot, says Larry McNaughton, MD at CoreBrand, a company that has tried to make a science - or at least get beyond the purely emotional aspects - of evaluating corporate brands' worth. McNaughton estimates that 14% of AOL Time Warner's market capitalization is related to its brand power. That's about $10 billion. He doesn't expect that to rise or fall significantly, despite the dramatic nature of the proposed name change. "The change seems to have some logic based on what's common knowledge about their business strategy," he says. "And the corporate name change will have only a minimal effect on the actual brand equity of the company." Whatever the effect on brand equity, AOL Time Warner, in its short history, has been given to grand gestures that befit the size and sway of the company. Dropping those three letters makes for a perfect fit. It marks a small victory for Time Warner's old guard, who, despite the fact that former CEO Jerry Levin suggested the name, were reportedly always sensitive about it. Plus, it makes business sense. Says McNaughton, "What they're probably doing here, and I give them at least some credit for it, is taking a relatively simple step in communicating what this company is all about, and that could only be a good thing because it becomes easier for people to be more familiar with them and [it shows] that they're reverting to a basic strategy the company will have for the long term." -matthew.creamer@prweek.com

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