????The Time Warner chairman, an early skeptic of the AOL-Time Warner combination, now presides over its dismantling.

????By Richard Siklos

????It was Jeff Bewkes who famously spoke up in an internal management meeting in 2002 and burst the bubble on AOL's friendly 2001 takeover of Time Warner, which was supposed to create a digital media juggernaut. "This is bull----", said Bewkes, who ran the conglomerate's HBO division, interrupting Steve Case, the Internet entrepreneur who had become chairman of what was then called AOL Time Warner. "The only problem in this construct is AOL."

????And it is Bewkes, who, as the current chairman and CEO of Time Warner (TWX, Fortune 500), has finally cut AOL loose: To the surprise of few, the company announced plans today to make AOL an independent publicly-traded company.

????In the era of economic crisis and beaten-down media stocks, the "worst corporate merger ever" doesn't have the sting it once had, and most media observers - and hard-bitten Time Warner shareholders and employees among them - have long resigned themselves to the fact that AOL could not regain its luster as part of the media conglomerate that owns Warner Bros., HBO, the Turner cable networks and Time Inc. (and whose brands include CNNMoney.com and Fortune).

????Indeed, at Time Warner's annual meeting this morning, AOL generated only a couple of brief shareholder questions at a gathering that lasted more than three hours. And Bewkes pointed out that its jettison follows the playbook used to recently make Time Warner Cable (TWC) a separate company, as part of a move to streamline and refocus the business as a purveyor of content. "We just need to perform well - steady earnings growth, steady cash flow and a clear future," Bewkes told the meeting.

????Still, AOL's impact on Time Warner for the past few years has been even greater than a glance at Time Warner's income statements would suggest. (For more on the financial impact of the spinoff, see "Time Warner goes with the cash flow.") The bigger cost of AOL to Time Warner has been psychic - a constant reminder not just of a bubble-era blunder that evaporated more than $100 billion in bubble-era shareholder value, but a more recent reminder that for years now Time Warner has not been able to figure out what to do with it.

????Thus, Bewkes' recent hiring of Tim Armstrong from Google (GOOG, Fortune 500) as AOL's new chairman and CEO - the second time he changed management in less than three years - was a clear signal that the business would be heading into a new, autonomous direction.

????The thinking is that, once independent, AOL will be free to pursue partnerships with the other leading Web players (Yahoo (YHOO, Fortune 500), Microsoft (MSFT, Fortune 500), Google, MySpace) who have been trying to figure out their next moves in the digital dance. For all its challenges, AOL is still one of the most-trafficked destinations online, with 107 million unique users, a reach that many media companies would kill for. (And, for what it's worth, it's still the largest seller of dial-up Internet access going.)

????Given that existing Time Warner shareholders will get a pro rata piece of the separate AOL, a split off neatly addresses a concern that the final indignity for Time Warner would be to sell the business too cheaply and see someone else make a success of it.

????Former AOL chief Case, who left the merged company not very long after Bewkes spoke out against it and its stock price collapsed, has publicly called for AOL to be split off from Time Warner for some time.

????Thursday morning, after Time Warner made its announcement, he Twittered on the subject: "Agree w/ Jeff Bewkes, it is best for AOL and for TW." A few minutes later, he added: "Thomas Edison: 'Vision without execution is hallucination' - pretty much sums up AOL/TW - failure of leadership (myself included)."