Learn to Adapt

These are my links for April 16th through April 17th:

• Real People Don’t Have Time for Social Media - ReadWriteWeb - This post ties in with my concerns about social fatigue. The vast majority of the working world has to work instead of twitter. But, they will need to have a strong social graph to improve their work performance. Balance is key.
• SaaS is driving the world’s 60 fastest-growing software companies - Perhaps SaaS will become the dominant model even before 2012? So what would "learning as a service" look like? Perhaps the EPS model opened up via APIs to be consumed and mashed up as needed?

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These are my links for April 14th through April 15th:

• WatchingTV Online - Blog I just discovered tracking the move of television to the Web. If their theme is correct, this will be a "threat to big media". No saying how the convergence game will play out, but converge we will!
• The Mobile Web Was Born Only Yesterday - I agree wholeheartedly with Michael: "So I disagree that The Mobile Web is dead. For many of us it is just coming alive." Just look at the use of mobil outside the US. The future of the Web is a mobile one.
• Social Aggregators Emerge To Manage Digital Lifestyles [Dion Hinchcliffe’s Web 2.0 Blog] - Dion's wonderfully brief post about the rise of social aggregation. This HAD to happen as social fatigue sets in. These will be a model for the future of managing one of our auxillary brains (our social graph(s))

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Just a quick note:  If you will be in Milan on March 23, drop by the Crowne Plaza Hotel for MIX08 Italy.  Steve Ballmer and his Microsoft crew will be giving the Microsoft spin on what is hot in Internet development in the morning.  I will be joining a host of colleagues from our Italian partner company, Reply, for additional presentations on delivering Web 2.0 and Enterprise 2.0 solutions in Italy in the afternoon.  So, if you decide that Milan sounds like more fun than another year of Web 2.0 Expo in San Fran, drop on by!

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These are my links for April 9th through April 13th:

• 10 Most Disruptive Technologies - eWeek pulls together Gartner's list of 10 most disruptive technologies through 2012. The annoying slideshow format asisde, it reveals technologies that will greatly impact the way we work, learn and live over the next five years.
• I Saw The Future Of Social Networking The Other Day - Another peek into the future that sees the Web (as most people predict, a mobile Web) as ancillary memory for us. As you read through Michael's blog, think about the impact this will have on learning and collaboration.

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Here is some undoubtedly errant math from a former AOLer (me):

In December 2005, Google purchased 5% of AOL for just over $1 billion, pegging its market value of about $21 billion. The Washington Post ran this article today:

Murdoch and AOL Join Fight Over AOL

So, from the numbers in the article (notably all based on hear-say and conjecture), I did some back-of-the-envelope math:

Supposing first that Yahoo’s contention that the Microsoft offer of $42 billion undervalues them, let’s give them a 7% markup, bringing their current value to about $45 billion. From the article:

“Under the terms of the possible Time Warner deal, the AOL unit would become part of Yahoo. In exchange for AOL and an undisclosed sum, Time Warner would receive a 20 percent stake in the enlarged company, said the source, who cautioned that the terms were not final and that the deal could founder.”

I’m going to ignore the “and an undisclosed sum” to make my fuzzy math easier. Assuming the 80% of the new venture that Yahoo would keep reflects their current $45 billion value, then the resulting entity would be valued at about $56.25 billion. So, Time Warner’s 20% would be worth about $11.25 billion.

Now, that probably does not reflect the full current value of AOL. Earlier in the article it states:

“Yahoo, meanwhile, is working out a complicated deal to acquire most of AOL from Time Warner, the world’s second-largest media company…”

I’m guessing the part they won’t buy is the AOL access (i.e., dial up) business. It’s not news that Time Warner is seeking a buyer for that already, but I haven’t seen any guesstimates of what the selling price would be if they can find a buyer. So, I’m going to pull a sale price out of my elbow (see - clean language Mom!) and say they could sell it for $1 billion. That would give AOL a current market value of $12.25 billion (under the deal outlined in the Post).

So, loads of fuzzy math aside, that means since the Google purchase in 2005, the value of AOL has dropped 40%. Let’s compare that to the TWX stock price. On December 21, 2005 (the day after the Google purchase was announced), the TWX closing share price was $15.58. Yesterday it closed at $14.43 - a drop of 7%. If what Google paid in 2005 was just, and the AOL value tracks with TWX overall (a great simplification), then AOL’s current value would be about $19.5 billion.

So, if all the fuzzy math and conjectured prices in today’s article are correct, one (or more) of three things is true:

1. Google paid too much for its 5% stake in 2005, and/or
2. The other Time Warner divisions have compensated for the 40% drop in AOL’s value such that TWX overall value only dropped 7%, and/or
3. The deal speculated in today’s Post undervalues AOL by about $7 billion

Given the conjecture in the post article, “In the unlikely event that both deals close, News Corp. and Microsoft would control Yahoo, MSN, MySpace and AOL…” and the fact that Google can decide to sell (or keep) its 5% of AOL this July, 2008 is going to be a very interesting year for AOL.

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