Not that long ago, America Online was THE high-technology firm in the Old Dominion. During the boom years of the 1990s, it hired thousands of workers and built a big office campus. AOL chieftains roamed the hallways of the State Capitol, advising on technology laws and cabinet posts. Chairman Steve Case was a political power. In one memorable closed-door confrontation, Case asked former Gov. Jim Gilmore what he'd do if Northern Virginians, infuriated by clogged highways, seceded from the state. Gilmore threatened to send in the National Guard.

AOL is decidedly more low-key these days. The headquarters of parent company AOL Time Warner are in a boxy skyscraper in midtown Manhattan. Still, the company has quietly made good on its promise to increase its presence in Virginia. It did lay off about 375 workers in Northern Virginia last summer and another 300 in January 2001, right after the merger. But now, it has grown its Virginia work force to about 4,600 and is still hiring, says Mark Stavish, AOL's executive vice president for human resources.

Most of the jobs are in areas critical to AOL's future. They include posts in wireless and broadband technology, network and software engineering, marketing and network administration. More people means more buildings. Since 1999, the company has spent more than $1 billion on two massive data centers in Prince William County. At the 152-acre Dulles campus in Loudoun County, a 220,000-square-foot building - its sixth "creative center" and the sixth building added since 1996 - is under construction. Most Virginia-based AOL workers are in Dulles; others are at the Manassas data centers or in offices in Herndon and Reston; some of those workers may be moved to the Dulles campus.

The Dulles campus is not flashy. No big signs proclaim it to drivers on nearby Route 28. Shuttle buses carry workers between the metal-and-glass buildings. Stavish says change and reorganization are common inside the company. "It is a very fluid and fast-moving and quick-changing company. We try not to get comfortable with offices or organization structures because we know that will change in the future as the business changes," he says.

AOL's political role has changed, but remains strong. The firm helped fuel last year's gubernatorial win for Mark Warner, a Northern Virginia venture capitalist who made millions in the high-tech boom. Warner counts among his friends Ted Leonsis, AOL vice chairman for new products, AOL Time Warner co-COO Robert Pittman and AOL CEO Barry Schuler. He and Case are said to have been personal friends for at least a decade. These kinds of relationships translate into campaign cash: AOL officials gave more than $470,000 to Warner last year. AOL also gave at least $25,000 to Warner's inaugural festivities. As Warner enjoyed the inaugural parade, several AOL officials stood on the reviewing stands a few feet away.

Although more subdued, AOL still has a political presence in Richmond. AOL's top Virginia lobbyist, James W. Hazel of the law firm of Williams Mullen, is now Warner's liaison to the state legislature. Hazel's father is the powerful Northern Virginia lawyer and developer, John "Til" Hazel Jr., who has openly boosted AOL and Case on land-use issues in the past.

Things have settled down. "I guess the melding with Time Warner may have diluted that just a little bit, because AOL goes from being a Virginia-based company to a Virginia-New York-based company," says Del. Joe May, R-Leesburg, chairman of the General Assembly joint commission on science and technology. AOL officials say they are still involved in the Old Dominion's scene. For example, Ray Oglethorpe, president of AOL Inc., serves on the board of directors of the Northern Virginia Technology Council. Kathy Bushkin, AOL Time Warner senior vice president and president of the AOL Time Warner Foundation, has helped organize two charitable foundations that will fund local nonprofits. Stavish himself is the new chairman of the Loudoun County Chamber of Commerce and is a strong advocate of new roads and education spending.

AOL's reputation draws top talent to Northern Virginia. "When people across the U.S. and around the world think of Virginia they're going to think of AOL. So they've definitely helped our profile," says John Backus, chairman of the Northern Virginia Technology Council and a principal with the venture firm Draper Atlantic. Not only did AOL attract gifted workers in the 1990s, it has grown a new crop of leaders who are going into executive positions at other companies, Backus says. One example is David Baker, president and CEO of Exit1 Inc., a Reston-based firm that provides Web services. Baker, 36, was AOL's director of publishing until he left in 1999. He invested some of his AOL-earned wealth into Exit1; today the company employs about 20. Baker's sure others will follow but that leaving AOL isn't easy. "It's hard to leave AOL because it's a great company," he says. A great one perhaps, but also a much quieter one.

Return to Virginia Business - April 2002