We ran into some audio trouble on the TWX call after this morning’s earnings report so are picking up from the transcript from SeekingAlpha/. Some highlights:

AOL: Chairman and CEO Dick Parsons: “AOL’s advertising revenue grew at or above 40 percent for the fourth consecutive quarter and we expect AOL to keep growing their online advertising throughout the year at or above the domestic industry rate—albeit that gross rates is lower than the 40 percent we posted this quarter.” Translation: AOL expects to sustain high double-digit growth but not at rates as high as 40 percent. AOL had four consecutive 40 percent or higher quarters. Later CFO Wayne Pace explained that the actual rate of growth for 1Q07 was 35 percent excluding a $19 million accounting benefit.

He said AOL is “well positioned” to grow overall profit for 2007. “Equally as important to the long-term success of the business, AOL is on track to begin to grow its page views, which is a key to the success of its advertising strategy. In fact, on a sequential basis, page views were essentially flat this quarter for the first time since we started reporting this metric.”
-- Pace: “Growth was strong across all advertising revenue sources including display and paid-search advertising on the AOL Network of owned-and-operated properties as well as advertising on partner sites.” Display advertising was up 32 percent; paid search on the AOL Network was up 26 percent; advertising on partner sites grew 81 percent including a “major customer”—without that customer it would have been 29 percent. “Ad revenues generated on partner sides are expected to increase at significantly lower rate than they did in this first quarter.”

Time Inc.: Digital is the bright spot. Parsons: “… gross in Time Inc.’s online ad revenue more than offset declines in magazine

publishing revenue. We see this not only continuing, but increasing over the course of the year.” Pace: “Ad revenues benefited from higher online revenues including gains at People.com, CNNMoney.com and SI.com.”

More on AOL during q&a: Asked about the possibilities including spin-off, president and COO Jeff Bewkes: “AOL is a very strong candidate for investment inside our company, because of the robust growth of the industry in which it completes and AOL own strong growth.” He mentioned the TradeDoubler bid “which at the end we did not finish due to basically what we’ve thought was an excess price” as an example of willingness to invest.
-- There are over 8 million “free” AOL accounts. More than 80 percent of those leaving the ISP are sticking with free. Email page views are up 7 percent quarter over quarter.
-- AOL is retaining more ISP subs than expected, which means it’s also losing less of that income than predicted.

Google: Parsons said they think the partnership with Google is “going very well. ... We think it’s one of that reasons that our ad numbers and gross has been as good as it is.”