AOL creates interactive video unit

Wednesday, August 22nd 2001, 12:00 am
By: News On 6

NEW YORK (AP) _ AOL Time Warner Inc. has created a new business unit to oversee all of the company's operations in next-generation cable TV services, including video on demand and nascent services such as AOLTV.

The new unit announced Thursday will be headed up by Joe Collins, the former head of Time Warner Cable and a longtime company veteran. Collins, who had previously reported to co-chief operating officer Bob Pittman, will now report to chief executive Gerald Levin. Collins's deputy, Glenn Britt, will take over as the head of Time Warner Cable.

Collins is also bringing James Chiddix, the chief technology officer at Time Warner Cable, with him to the interactive video division. Collins said he would begin assembling the rest of his team shortly.

The new unit will oversee the development of several early-stage cable services, including video on demand, which is being now offered through AOL's premium cable network HBO on a test basis in Columbia, S.C.; the addition of other Internet service providers besides AOL to Time Warner's cable lines; and a version of AOLTV that can run over cable lines instead of phone lines, which is expected to launch later this year.

``This is a case where I want to have an integrated, coordinated response,'' Levin said in an interview. ``The development of what I'll call a mass market service for interactive video _ that's really what the merger is about. Rather than just rely on the interrelationship of the cable company and AOL, I want to sharpen the focus and have them reporting to me.''

Using Time Warner's vast network of 12.8 million subscribers _ the second-largest in the nation _ to deliver next-generation interactive services has long been a stated goal of the merger between AOL and Time Warner, but those services have as yet been slow to materialize since the merger closed at the beginning of the year.

The HBO video on demand experiment got under way this May, and so far AOLTV is available only over phone lines. Phone service is just beginning to be offered on a test basis over cable lines in Maine.

Shares of AOL Time Warner rose 35 cents to close at $40.05 in trading Thursday on the New York Stock Exchange.