AOL Spin-Off

Time Warner Approves AOL Spin-Off

By Zachary Rodgers , May 28, 2009

Earlier this year, Time Warner took the first steps toward spinning off AOL. Yesterday the board endorsed that plan and authorized CEO Jeff Bewkes to move forward to jettison its Web advertising and Internet access businesses.

After a separation, AOL would be an independent, publicly traded company. It would consist of a dial-up access business that is still among the largest in the U.S.; the AOL.com portal and other in-house properties such as Bebo and TMZ; and ad network Platform-A, which boasts a greater than 90 percent reach among U.S. Web users, according to Comscore.

"The separation will be another critical step in the reshaping of Time Warner that we started at the beginning of last year," Bewkes said in a statement. "The separation will also provide both companies with greater operational and strategic flexibility."

For advertisers, who were exposed to few if any synergies between AOL and other Time Warner businesses, the changes resulting from a spin-off will likely be few.

However, AOL CEO Tim Armstrong is reportedly preparing some significant structural transformations at the company, including the creation of a Ventures unit to house the company's Bebo social networking platform and other recently acquired sites and services. According to BoomTown, the new unit is meant to attract outside investments.

Armstrong stated AOL will leverage its independent status to accelerate its recruiting efforts. "We play in a very competitive landscape and will be using our new status to retain and attract top talent," he said. "Although we have a tremendous amount of work to do, we have a global brand, a committed team of people, and a passion for the future of the Web."

As part of the preparations for a spin-off Time Warner will re-acquire the 5 percent of the AOL business it sold to Google in 2006. The remaining 95 percent of AOL already belongs to Time Warner shareholders. Time Warner said it hopes to complete the legal and structural separation of AOL by end of year.

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H1N1 Upclose

By Tina Hesman Saey Friday, May 22nd, 2009

Components of the H1N1 swine flu virus have been circulating undetected for years, but the virus combines the bits and pieces in a way never before seen, a detailed genetic analysis reveals.

The analysis, published online May 22 in Science, pinpoints the origins of each of the virus’s components. It suggests that current influenza vaccines probably won’t provide protection from the virus, but that the virus is susceptible to some antiviral drugs and will be amenable to new vaccine development. A separate study of the virus’s neuraminidase protein (the N in H1N1), published May 20 in Biology Direct, also shows that the virus is sensitive to some drugs but that parts of the protein important for vaccine development and antibody therapies are already changing.

Pigs are the likely origin of the virus, says Nancy Cox, chief of the influenza division at the Centers for Disease Control and Prevention in Atlanta and a coauthor of the Science paper. But it is still unclear whether the virus jumped directly from pigs into humans or infected an intermediate host first.

In the United States, 6,552 probable and confirmed cases of H1N1 influenza, including nine deaths and more than 300 hospitalizations, have been reported to the CDC as of May 22, says Anne Schuchat, CDC’s interim deputy director for the science and public health program. But public health officials estimate that more than 100,000 Americans may have already been infected with the virus.

Overall the number of new cases in the United States is falling, Schuchat says, but the virus is still active in some pockets of the country and is expected to produce more new cases over the summer. “We don’t want people to think we’re out of the woods yet,” she says. “It could come back in the fall in the worst way.”

CDC is already testing two candidate vaccine viruses and expects to send the viruses to manufacturers by the end of May, Schuchat says.

Genetic analysis of the new H1N1 virus reveals that three of its genes, including the hemagglutinin gene (the H in H1N1), originally came from the 1918 Spanish influenza virus and have been present in pigs ever since. The genes have not changed much, likely because pigs do not live long enough to get reinfected with the same virus, Cox says. Reinfection would have favored changes that could have allowed the virus to evade the immune system. Now that the virus has entered humans, researchers expect it to mutate at the same rate as currently circulating seasonal influenzas.

The new virus does not contain the genetic changes thought to have helped the 1918 flu virus and the H5N1 virus (avian flu) adapt to humans, the researchers report. That means that other genetic components of the new virus must be responsible for its ability to pass from person to person.

Both studies find that the closest relative of H1N1’s neuraminidase gene is from a Eurasian swine flu virus that probably leaped from birds to pigs in about 1979.

The new virus differs in 21 of 387 amino acids from the H5N1 virus and the 1918 Spanish flu (also an H1N1 virus), researchers from Singapore’s Agency for Science and Technology Research report in the study in Biology Direct. Viruses isolated from patients during the first two weeks of the current outbreak already have changes on the outer surface on the neuraminidase protein that could interfere with antibodies against the virus or alter the effectiveness of future vaccines. But none of the changes have altered the parts of the protein targeted by antiviral drugs, such as Tamiflu or Relenza.

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