I'll never forget waking up in January 2000 and hearing on the radio that AOL and Time Warner were merging. As a reporter for TheIndustry Standard, I was plunged immediately into a fugue state by the news, as I anticipated my coming workload of breathless stories about it. It seemed the deal of the century -- a 15-year-old Internet service provider had bought one of the world's largest media and entertainment companies. Not only would a lot of people get filthy rich, but also their combined forces would change media forever. Well, not quite.
Bay Area-based Wall Street Journalcolumnist Kara Swisher explains in her excellent new book why the merger turned out to be a rotten egg. The title refers to an old joke told by Ronald Reagan, and retold by an AOL exec, about a foolish boy looking for a pony in a pile of horse manure. The joke was analogous to AOL searching for its own value as a company -- something Time Warner would soon find itself doing, plunging headlong into the same pile of shit. Ponyis a wickedly funny, insider-y tale of the dire effect of tumbling Net stocks on the risk-averse Time Warner and the violent culture clashes between the "enfants terribles" of AOL and the "stodgy," "Waspy" Time Warner-ites. Swisher deftly paints the characters of the top executives, then exposes all the bickering and back-stabbing -- as when an AOL lawyer printed T-shirts for his colleagues that read "Putz, we are" in response to a haughty Time Warner exec, who dared question whether AOL, in the complicated stock transaction that joined the two companies, was truly the one buying Time Warner. ("Putz" is Yiddish slang for penis.) It's telling that that lovely move was made right at the beginning of the failed marriage.