NEW YORK (TheStreet) -- AT&T (T) - Get Report agreed to buy Time Warner (TWX) over the weekend for $85.4 billion, but this isn't a win for Time Warner, Recode's Kara Swisher said on CNBC's " Squawk Alley" on Monday morning.
"I don't think selling is a victory. I think it's a nice price and they did fine. But it's certainly not a victory for Time Warner to sell and not figure out its digital future," she argued.
If Time Warner had adapted better to the digital age back in 2000 when the now-failed AOL deal happened, then it could have created Netflix (NFLX), among other groundbreaking innovations.
"They could have done Netflix. They could have done any number of these things. They could have done lots and lots of the Internet efforts in the content space. They could have done Snapchat. And this company never did that," Swisher explained.
Even after all these years, Time Warner still hasn't nailed down a digital strategy, which is why it's selling itself, Swisher said.
"They're selling their content to a company that can presumably help them get better digital distribution," she explained.
The AOL deal was the right idea and if the Time Warner had made it work, then it might be in a much better place, Swisher noted. "You can imagine what they could have done had they behaved better," she said.
Back in 2000, Time Warner CEO Jeff Bewkes was "very much against" making a deal with AOL, she claimed.
"It just seems like you kind of wonder if they had done it right back then, what company would exist today? And I mean that on both sides, not just the Time Warner side, but [Time Warner] was being super difficult," Swisher said.
Earlier today, Time Warner CEO Jeff Bewkes said that he was not oppposed to the AOL deal in an interview on CNBC's "Squawk Box." He said that he was open to the idea of a merger with AOL, but that it was "mis-described at the time" as a distribution company.
"They weren't distribution, and I wasn't against it," he said.
Shares of AT&T and Time Warner were lower in late afternoon trading on Monday.
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