A recent story in the New York Times reveals that Time-Warner all of a sudden has the warm-and-fuzzies again for AOL (login required to see story). For those of us who have been circulating in this business long enough, we all remember – and now shake our heads in incredulousness – at the fact that AOL actually bought Time-Warner back in the heady days of sock puppets and orange bicyclists.

At the time, I probably had the same opinion as many – that this was the first step into the next world and that would be my generations world, mind you, right there on the internet. Other than pixel sizes and pets being allowed at work, it was no different than the huge swath of disenfranchised kids of the late 1960’s who just knew they could change the world. They just knew it.

Much like those kids, things turned out much differently. AOL, in essence, has become no different than an abused spouse. After the deal fell out of favor, Time Warner tried everything with AOL short of bringing it out back behind the barn and shooting it. I mean, did they really think that dial-up was it? Did they think people were going to pay extra for content? I guess that’s what happens when you almost have a monopoly – you think nothing will ever change and you’re too scared to move off the nipple. In this case, thier nipple was that screeching sound the phone line made when you connected. By the time they realized broadband had lapped them, it was over. Since then, they’ve lost (going on memory) nearly a quarter of their customer base. Ouch.

So the decision to throw up their hands earlier this year and essentially become a cross-dresser is an interesting one and most likely a last desperate move to stay prevalent. I’ll get to that cross-dressing thing in a minute. In case you’re still reading, what AOL has done is this: they’ve opened up the kimono (an ugly corporate adage that I promise to never use again) and are now offering everything up for free, hoping like mad that people will perform the second-most performed act on the internet – search. They’re actually throwing thier hat into the ring and are attempting to go up against Google and Yahoo.

The best part? The company they’re trying to trump is the one who will be providing them with the lions share of their revenue – Google. Yes! Google is the company that provides nearly ALL of AOL.com’s search results, paid or unpaid. Welcome to the wonderful, confounding world of search, people. Come on in and have yourself a seat, won’t you? AOL is now Google with hot red lipstick and pumps! She’s a man, baby!

So, now that AOL is, in effect, Google, what next? Well, first off, most users don’t know or care whose search results are being used, so AOL certainly has that going for them. And since everything Google touches turns to solid gold today, AOL has seen a pretty dramatic increase in revenue, almost entirely due to paid search results, despite the loss in subscribers. Result: Time-Warner goes all public in the newspapers, oohs-and-aahs all over AOL and even goes so far as to say that AOL is back to being a number one priority for Time-Warner. Now would also be a really good time to point out that not so long ago, who was that fighting so valiantly to remove any reference of AOL from their corporate name? Ah, Time-Warner. How we love thee corporate BS!

Don’t buy it. These eyes don’t believe for a single, solitary second that AOL is a again the apple of Time-Warner’s eye. They’re doing what any faceless, nameless corporation would do – they’re trying to pump this thing up to get more other companies interested in buying it, because they know the endgame with AOL. They’ve already been through it and they are living it.

Which brings me to my next amusing piece of news: dag-nammit, it seems to be working! It’s rumored now that Gatesasaurus Rex is poised to strike again and have MSN merge or even outright acquire AOL! Yo ho ho and a bottle of brass monkey! Wouldn’t that be something? Of course, MSN’s agenda is to roar loud and breathe fire like they did when they charred Netscape back in the ’90s – they’re going after Google hardcore, yo, and nabbing AOL would be step one in their attempt to further distribute their new search and paid links products.

At the onset, this even seems like an intelligent and sound strategy. Hit ’em where you can, when you can. But seriously, is AOL relevant? This is the toughest question of all. Is MSN posturing with these rumors in an attempt to get Google or even Yahoo to panic-bid on it? One can imagine BallGates sitting in their offices laughing because they, too, know the cruel fate of AOL. Or do they really think there’s something there? I have no idea. I only have my own opinion and that opinion is that whomever buys them is really in for a heap of dung in the longterm.

As usual, there’s more to this story than what’s above. AOL does own some interesting small technologies and they are really starting to rake in the dough. Microsoft, despite their perception by many as an old battering ram, has some incredibly neat stuff in the queue (check out Robert Scoble’s weblog if you can – this guy works for Microsoft and writes a truckload of a blog about it – sometimes he rips them to shreds and other times he heaps on the praise. My opinion: he’s the best voice they have, even if he doesn’t agree with me about AOL. Screw the public relations department – he’s done more for that company in the last year than the PR department has in the last 10. I wish I could do that for the company I work for!

Anyway, an asterik: my opinion is my opinion and is no way, shape or form a represenation or position of the company I work for. Just want to get that out of the way before anyone goes all nutty.