Bob Pittman will be Mr. Inside, and Dick Parsons will be Mr. Outside.

That, to summarize a research note from Morgan Stanley, is the quick consensus from onlookers reacting to

Wednesday's news that

AOL Time Warner

(AOL)

CEO Jerry Levin will step down, co-Chief Operating Officer Parsons will replace Levin as CEO, and co-COO Pittman will hold on to that title by himself.

Whatever the moves portend for office politics, outsiders don't believe the fundamentals of the company will radically change with Levin's scheduled departure in May. Rather, the company will continue on its quest of melding its various properties into an interdependent, cross-marketing multimedia colossus. In Wednesday afternoon trading, AOL Time Warner shares were up 76 cents to trade at $35.51.

Alan Parsons Project

If the announcement changed anything, it has solidified Pittman's operational responsiblities, say observers. AOL Time Warner's music and film divisions, which previously reported to Parsons, will report to Pittman along with the units he currently supervises: networks, cable and American Online. Pittman, in turn, will report to Parsons.

Morgan Stanley analysts Mary Meeker and Rich Bilotti were comfortable with the news that Pittman would take a greater hands-on role, while Parsons likely would focus on the company's relationships with governments, companies and customers. Parsons "has built his career on a reputation as a strong negotiator of customer relationships, builder of alliances with other companies ... and forger of fair and reasonable regulatory policy," the analysts wrote in a note. Morgan Stanley, which has a strong buy on AOL Time Warner, has been a banker for the company.

Along those lines, UBS Warburg analyst Christopher Dixon and A.G. Edwards analyst Sharon Williams each described Parsons as a "consensus builder." Both analysts have a strong buy on AOL Time Warner; neither's company has done recent banking for it. Dixon has personal holdings in the stock.

One longtime company observer, speaking on condition of anonymity, calls Parsons "a great front guy" who can defend the company's interests in Washington on such regulatory and legislative issues as media ownership concentration. "Parsons is great at that," says the buy-sider, who isn't currently long or short AOL stock, but is a lukewarm fan of the company at best.

Ted Turner, Your Best Friend

Others took the news as time to reflect on how important a role Levin has played at the company -- in such areas as his pioneering role in the now-commonplace practice of distributing cable television via satellite, as well as his pivotal vision of combining America Online and Time Warner and his efforts to bring it to fruition.

Michael Tucker, a portfolio manager at the

(FCTAX)

Federated Communications Technology fund, said he doesn't think Levin's departure would be bad for the company, in which his fund holds a stake. "I would be more disappointed if he were leaving right now as opposed to five or six months from now," Tucker said.

Walt Ciciora, formerly Time Warner Cable's vice president of technology, praised Levin as someone "who could see what was coming a mile away, and could take definitive action to help it along." Because of Levin, says Ciciora, Americans have better access to news, entertainment and information, citing, among other efforts, Levin's championing of satellites for cable -- "seeing that technology when others thought it was impractical."