UPDATE: Powell To Be Among AOL Directors After Spinoff

AOL unveiled a cast of eight media, technology and financial veterans--including former Federal Communications Commission Chairman Michael Powell--who have agreed to sit on its board of directors after the Internet company is spun off from Time Warner Inc. (TWX) in a deal expected before year end.

The announcement suggests that the spinoff, which will undo one of the worst deals in corporate history, is on track as the companies wait for regulatory approval. Its completion will mark a key step in Time Warner Chief Executive Jeff Bewkes' plan to restructure the media conglomerate as a media content provider.

It also adds to AOL's credibility as a stand-alone, publicly traded company, which already got a boost when Google Inc. (GOOG) veteran Tim Armstrong signed on as its chief executive last spring. AOL continues to struggle as subscribers to its dial-up Internet service dwindle, while its digital media businesses slog through an advertising slump.

Armstrong will sit on the board as chairman with Powell, son of Gen. Colin Powell and FCC chairman from 2001 to 2005; former Public Broadcasting Corp. Chief Executive Patricia Mitchell; former Amazon.com Inc. (AMZN) Chief Information Officer Richard Dalzell; former CBS Corp. (CBS) Chief Financial Officer Fredric Reynolds and former William Morris Agency Chief Executive James Wyatt.

Its board will also include William Hambrecht, founder of WR Hambrecht & Co., the financial services firm that managed initial public offerings for Amazon.com and Apple Inc. (AAPL); Karen Dykstra, former chief financial officer with Automated Data Processing Inc. (ADP) who is now a partner with Plainfield Asset Management; and James Stengel, a former marketing executive with Procter & Gamble Co (PG).

Time Warner and AOL were combined in a $100 billion merger in 2001 with disastrous results. Their separation is expected to provide both companies with a chance to remake themselves at a time when the media landscape is undergoing a dramatic transformation amid the rise of digital media.

-By Nat Worden, Dow Jones Newswires; 212-416-2472; [e-mail]

(Kevin Kingsbury contributed to this article.)