NEW YORK --Time Warner Inc., the world's biggest media company, will release a revamped strategy for its AOL Internet unit next month as the business struggles to boost revenue and stem customer defections.
The plan will coincide with second-quarter financial results on Aug. 2, New York-based Time Warner said yesterday.
Time Warner stock is little changed in the past year on concern that stumbles at AOL will continue to weigh on profit. Chief executive Richard Parsons is attempting to bolster AOL's advertising revenue to compensate for the loss of paying dialup subscribers to its service. The Wall Street Journal yesterday reported those plans may include offering a free broadband service that could cost $1 billion in profit.
AOL ``dominated" in the slower dialup Internet service, said James Goss, an analyst with Barrington Research in Chicago . ``That part of the business is going away in a broadband world."
Time Warner said media reports on its plans contain erroneous financial information. Spokesman Edward Adler said the company wouldn't comment beyond the statement until Aug. 2.
AOL, which has been losing Internet access subscribers, is trying to get customers to switch to higher-priced, high-speed access. It had 18.6 million subscribers at the end of the first quarter, 835,000 fewer than in the previous period. A free service would slash US subscription profit to about $800 million over the next 2 1/2 years from $1.6 billion, the Journal said.