AOL COO Stepping Down

AOL Time Warner Thursday confirmed that Chief Operating Officer Robert Pittman, who is also serving as interim
chief of the America Online division, will leave the company and that a management shake-up is in the works.

Following a meeting of AOL’s board of directors Thursday, Chief Executive Officer Richard D. Parsons said Pittman will step down as
COO and as an AOL director after leading the transition to a new CEO for its America Online division.

“I’ve decided that after a new CEO is in place at AOL, I won’t return to AOL Time Warner as chief operating officer,” Pittman said
in a statement Thursday afternoon. “Having worked so hard to build the AOL service and brand, and after then going through the
merger and the last 18 months, it’s time to take a break. I’m proud of what we built at AOL and believe that it has a great future.”

AOL’s board also elected to elevate Don Logan, chair and CEO of Time Inc., to chairman of its new Media & Communications Group
(consisting of America Online, Time Inc., Time Warner Cable, and the AOL Time Warner Book Group and Interactive Video unit). Jeff
Bewkes, chairman and CEO of HBO, was named chairman of the new Entertainment & Networks Group (consisting of HBO, New Line Cinema,
the WB, Turner Networks, Warner Bros. and Warner Music). Both will report directly to Parsons.

The board also filled both men’s former positions. Ann Moore, executive vice president of Time Inc., will replace Logan as chair and
CEO of Time Inc. Chris Albrecht, president of HBO Original Programming, will step into Bewkes shoes as HBO chairman and CEO.

In addition to the slate of management changes, the embattled company now finds itself defending accounting practices related to
online ads after a report raised questions about how it booked revenue on the deals.

The company’s stock has been rocked by a series of troubles such as slowing growth in its ISP subscriber base, the collapse in
online advertising amid a media recession, debt issues and market turmoil buffeting its market capitalization.

Public reports have speculated that the appointment of Logan and Bewkes to senior positions could indicate a move away from the
centralized approach to managing the company’s units which AOL Time Warner has used since the merger of AOL and Time Warner was
sealed 18 months ago.

Both Logan and Bewkes have reputations as strong advocates of decentralized management with fairly autonomous divisions compared to
Pittman’s centralized style.

The news comes as the media giant prepares to release its second quarter results on July 25. By most accounts, analysts are bracing
for more bad news given the sluggish rebound in advertising revenues among media companies so far this year.

In addition, the company is also responding to a report in today’s Washington Post that is raising question about how the media
giant accounted for advertising revenues as the dot-com collapse was spreading to big media companies.

The report referenced hundreds of pages of confidential AOL documents, which allegedly indicate that AOL boosted revenue using a
series of unconventional deals from 2000 to 2002.

In a statement responding to the report, an AOL Time Warner spokesman defended the accounting for all of the transactions mentioned
in the story as appropriate and in accordance with generally accepted accounting principles (GAAP). Its auditors, Earnst & Young,
also checked the accounting and signed off on it, the company said.

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