Google Out of AOL

Seems like the only person who wants anything to do with AOL is former Google exec Tim Armstrong, who just recently took over the company. In a quarterly report filed yesterday, Time Warner (TWX) announced plans to spin off part or all of the former dial-up giant. First-quarter revenue for AOL fell by 23 percent compared with the same period last year, to $867 million. When Time Warner acquired AOL in 2001, it paid $124 billion for the privilege but fully expected to make up for it by exploiting synergies between Time Warner's content and AOL's massive list of subscribers. Google (GOOG) executives thought that sounded pretty smart and bought a 5 percent stake in AOL as well.

Now, the online company is a big, squawking albatross around Time Warner's neck; according to the Washington Post, AOL's revenue fell 20 percent last year, and the company has decided to ditch all or part of it altogether. Google also came to this conclusion back in January, when it exercised the option to sell its stake on the open market. Yesterday, Time Warner announced it planned to buy back Google's stake before moving ahead with its plans. The price has yet to be determined, but Google executives, who have been trying to ditch all unprofitable ventures and refocus its attention on search and advertising, must be breathing a sigh of relief that this process will go smoothly.

Still, not everything is perky at Google today. The Wall Street Journal reports that David Rosenblatt, who headed Google's DoubleClick display-ad unit, is leaving the company. Although its search ads are humming along, Google has been working hard to reinvigorate its more lucrative display-ad sales, and Rosenblatt's departure will throw a big wrench into those plans. With Armstrong and now Rosenblatt gone, talk of a brain drain at Google has officially started up once more; Silicon Alley Insider even has a cute interactive slide show to illustrate the exodus. Reporters Dan Frommer and Nicholas Carlson go through the usual reasons to leave: None of the execs can advance much higher than they already have, and Google is filled with restless, talented people who want some new challenge to stimulate them. But seeing as how the company's stock is pushing close to $400 a share, we doubt anyone's too worried right now.