Wall Street will breathe easier at Time Warner ( TWX) now that the long-awaited baton-pass from Dick Parsons to Jeff Bewkes has officially taken place, but how long will the honeymoon last?

The world's largest media conglomerate confirmed Monday that Bewkes, the company's president and chief operating officer, will take over as CEO at the end of the year, while Parsons will become chairman.

Shares of Time Warner have been largely stagnant in Parsons' five-and-a-half-year tenure, which began after the company's disastrous merger with Web giant AOL and before the bursting of the dot-com stock bubble.

Now, investors are hoping Bewkes will bring much-needed changes at the company to get the stock moving. Namely, shareholders are rooting for a sale or spinoff of AOL.

"Parsons is the last man standing who was part of the Jerry Levin cabal that put the AOL deal through," says Porter Bibb, managing partner with MediaTech Capital Partners. "It's probably psychologically and emotionally impossible for him to explicitly divest from what most people recognize as the worst business deal in history."

Bibb points out that Bewkes is viewed as more of an operator, while Parsons is seen as a diplomat -- which could lend itself well for another job.

"There is widespread speculation that Parsons will run to be the next mayor of New York City," Bibb says. That's a role that he could be well-suited for."

In some ways, Time Warner is not unlike a government bureaucracy. It's a sprawling conglomerate of disparate business units that don't work together particularly well. The magazines at Time Inc., such as Fortune and Time, have their own Web sites, but they're not well integrated at AOL. The company owns two movie studios -- Warner Bros. and New Line Cinema -- that could be consolidated, or one could be spun off or sold.

In March, the company partially spun off its lucrative cable business, Time Warner Cable ( TWC), but investors are calling for a complete separation of the unit, which is still 83% owned by Time Warner.

Meanwhile, Wall Street is demanding growth on the Internet from the media industry, and AOL has disappointed. In its second-quarter report, the company stepped back from its forecast that the unit's strategy shift toward an ad-supported Web portal, such Google ( GOOG) and Yahoo! ( YHOO), would lead to ad revenue growth above the industry average.

"We see advertising demands shift recently towards third-party advertising networks," said Time Warner. "This put some pressure on AOL's display advertising in the quarter."

That statement contradicted optimistic comments made previously by AOL's CEO, Randy Falco, prompting Pali Research analyst Richard Greenfield to declare that he had "lost faith/trust in Time Warner's management team and board of directors."

Bewkes, who ran HBO for seven years and turned it into a powerhouse, is said to have more operating knowledge of the company than anyone else in Time Warner's senior management ranks, and investors appear ready to embrace him for the time being as a catalyst for change.

"The business units of Time Warner operate totally separate from one another, so Bewkes either has to break them up or get them to work together," says Bibb. "Getting these companies to work together and realize the value of having an integrated media company is the challenge that anyone who is going to run it faces if they want to get the stock anywhere close to where it used to be."

Shares of Time Warner closed Monday at $17.81, down 7 cents.