AOL May Name Chairman’s Successor

To quiet rampant speculation over who will take the reins of troubled media giant AOL Time Warner Inc., company insiders said Wednesday that the board may act as soon as today to pick a new chairman, speeding the selection by weeks.

Sources predicted that the directors could name Chief Executive Richard Parsons as a replacement for outgoing Chairman Steve Case, a chief architect of the ill-fated merger between AOL and Time Warner. Case said this week that he will step aside in May.

It remained unclear, however, exactly what might unfold should Parsons be named as Case’s successor during the board’s regularly scheduled meeting in New York today. Under one scenario, Parsons would retain the titles of both chairman and CEO. But that may raise problems with some investors who have come to believe that, given recent corporate scandals, it would be wiser to split the jobs between two executives.

Some observers say that should Parsons wear both hats, it might be for only a short time while the board seeks a new CEO in a calmer climate. One front-runner is insider Jeffrey Bewkes, former head of the company’s Home Box Office channel recently promoted to oversee cable channels, the movie studio and music under Parsons.

“The one guy who is extremely well thought of is Bewkes,” said an executive close to AOL Time Warner Vice Chairman Ted Turner. Turner, a major shareholder and influential board member, is seething over the plummeting stock price and is pushing for dramatic changes. His friends say he is particularly impressed by Bewkes, a financial expert who mastered the creativity needed to turn HBO into a cable powerhouse.

Turner led a campaign to oust Case and Parson’s predecessor, Gerald Levin -- both of whom were architects of the troubled merger.

Another name that surfaced was that of Viacom Inc. President Mel Karmazin. The New York Post reported Wednesday that AOL Time Warner is in serious negotiations to hire him.

That touched off a frenzied reaction on Wall Street and in media circles, prompting the conglomerate to issue a flat denial. Sources said Parsons, known for being unflappable, called the paper to complain. Viacom Chairman Sumner Redstone, who is negotiating to extend Karmazin’s contract, told a group of investors Wednesday that the paper had displayed a “disregard for the truth.”

“We’re reviewing the matter and will report any clarifications if needed,” said Jon Elsen, business editor of the New York Post.