Time Warner has today confirmed widely-expected plans to pacify its long-suffering investors with a cash windfall from the sale of its US cable tentacle.

Chief executive Jeff Bewkes said during the conglomerate's Q1 earnings call: "We've decided that a complete structural separation of Time Warner Cable, under the right circumstances, is in the best interests of both companies' shareholders."

Details of how the sale will work will be finalised "soon", he said.

Time Warner floated shares in its cable business just over a year ago, but held on to an 84 per cent stake.

The Big Idea is that two separate companies will be able to better focus on their strengths, or lack thereof. Time Warner will become a pure content business with its studios, TV channels and (for now) AOL. Time Warner Cable will flog broadband internet and cable TV access.

The results themselves were no great shakes, and in line with market expectations. First quarter net income was $711m, down 36 per cent on a year earlier when the sale of its German access business bolstered Time Warner's profits. Total revenues crept up two per cent to $11.42bn. The group spent $116m on restructuring charges.

AOL, the Time Warner village idiot, once again came bottom of the class. Its earnings slid a further 74 per cent on revenues that were 23 per cent down. AOL's bid to reinvent itself from a portal and shrinking dial-up business (now being spun out) to a 2.0tastic advertising and content network is not happening fast enough to make up for its subscriber losses. Advertising revenue was up just one per cent.

The $850m purchase of Bebo is yet to convince and Time Warner investors look set to continue to clamour for AOL to be amputated too. Microsoft's yawnsome courtship of Yahoo! complicates matters though, as both had been seen as a potential mug buyer for AOL. Time Warner made no comment on AOL's future today. ®

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