Time Warner: clicks or mortar?

On Friday I saw a news item about how media conglomerate Time Warner was considering a purchase of the European ISP Tiscali. This seems crazy, considering that Time Warner's Internet division, AOL, has been offloading its ISP assets in Europe for the past several months to concentrate on a portal-only business model. (Most recently, AOL in the UK was being sold to Carphone Warehouse; there have also been sales in the past month in France and Germany.)

Granted, Tiscali has some good inroads in developing a converged business model for its communications/entertainment offerings, particularly in the UK where it has recently bought IPTV provider Homechoice.

But in the markets where it operates, Tiscali has been far behind AOL in terms of subscriber numbers, surely one of the most important metrics for a company like TW that depends on eyeballs for advertising revenue and distribution deals for its content operations. For its part, Tiscali has for quite some time been slowly selling off its various European assets in a bid to cut its losses and focus on Italy and the UK (most recently it's been reportedly in a deal to sell its German assets).

Seems like a real dark horse buy for TW if the rumour is true.