Time Warner Considered AOL Spinoff

Time Warner said that it had recently considered spinning off its America Online unit, but decided that it would be unnecessary to do so at this time, according to a report in the Wall Street Journal on Friday.

The online division would have been spun off to create some cash revenue to allow for other acquisitions, the company said.

"Right now AOL is currently integrated into our operations," Time Warner CEO Dick Parsons said. "But if it gets to the point where consolidation is happening in the Internet space and, in order to play most efficiently, we need ... our own currency, the possibility [of an initial public offering] is out there."

Parsons admitted that the AOL merger did not work out as Time Warner had hoped, but reiterated that the online service is an important part of the company.

In recent months, revenues have been declining at AOL as the company has struggled with subscriber loss. These problems have become a drag on Time Warner stock overall, prompting calls by shareholders to either look for ways to turn the division around or spin it off altogether.