Luckily, these days, it's usually at someone else's expense.
Case in point: Time Warner's decision to spin off its publishing unit, the venerable Time, Inc.
It's not hard to understand why the TV and movie company would want to rid itself of a declining business like print magazines. It doesn't need the drag on earnings growth. Plus, spin-offs are a golden opportunity to beef up the balance sheet by extracting a special dividend and casting off debt.
The more interesting question is how Time, Inc. got itself into this position.
Some say it was inevitable -- much of the advertising that sustained magazines like Time, People, Fortune, and Sports Illustrated were siphoned away by the likes of Google.
But I think Time, Inc.'s problem was more fundamental: the company never really understood what business it is in. It bought AOL because it saw a natural fit between its business (content) and AOL's (electronic delivery).
But in fact, AOL was in three businesses -- dial-up Internet access, communications services such as email and instant messaging, and a portal or home page from which unsophisticated users could begin their exploration of the Internet. At the time of their merger, the first of those businesses was about to go the way of buggy whips, the second had no relevance to Time, Inc., and the third hid behind a "walled garden" that was easily -- and quickly -- displaced.
Time, Inc. didn't even understand its own business, which was more than raw "content" as defined by copyrights and trademarks. The company was actually in at least three businesses -- branded journalism, advertising sales, and magazine distribution.
When the Internet came along, the company shoveled all its branded journalism onto a single platform called "Pathfinder," as if it was the electronic equivalent of its print distribution network. Its storied titles wern't allowed to build their own presence on the 'net. And the audiences that trusted them went elsewhere. So did advertisers.
The spin-off of Time, Inc. represents an opportunity to correct those mistakes. But the company's success depends on two things. First, that the new management really understands what businesses it's in. And two, that it has the financial capability to invest in them.
I hope the company learned those expensive lessons from the likes of AOL and AT&T.