The author believes that Time Warner is making a mistake by spinning off the companies publishing unit. The primary losses to Time Warner would be the potential synergies the department could take advantage of and the loss of interaction that department would have in the company. These both could create future issues.
The first of the two the loss of synergies that could be created may or may not ever be realized. The example given is using the publishing unit in conjunction with their electronic media division to publish e-books. These could be items that would help the company compete, or they could find that they do nothing long term to aid the company. The key that the author does point out is this could be a strong growth market that the company is just ignoring.
The second is the interaction between the divisions that currently exist. The publishing unit might be sharing the same costs as other units. By removing the publishing unit the company could be inadvertently causing other divisions to become unprofitable.
The first of the two the loss of synergies that could be created may or may not ever be realized. The example given is using the publishing unit in conjunction with their electronic media division to publish e-books. These could be items that would help the company compete, or they could find that they do nothing long term to aid the company. The key that the author does point out is this could be a strong growth market that the company is just ignoring.
The second is the interaction between the divisions that currently exist. The publishing unit might be sharing the same costs as other units. By removing the publishing unit the company could be inadvertently causing other divisions to become unprofitable.