When Time Warner chief executive Richard D. Parsons speaks at a Goldman Sachs investor conference today, Wall Street analysts and AOL employees will listen for clues about plans for the company's Dulles-based America Online division.

Parsons's comments will be his first since word of preliminary negotiations between Time Warner Inc. and Microsoft Corp. surfaced. Those talks centered on ways that America Online Inc. and Microsoft's MSN might join forces to create a bigger, stronger Internet competitor to Google Inc. "He absolutely will be asked about it," said Raymond Katz, an analyst with Bear Stearns & Co. "I think what you will hear from him is how valuable AOL is, how important it is to the company, meaning Time Warner, and how they are not going to do anything that does not maximize shareholder value."

Meanwhile, each company privately has staked out core conditions in the negotiations, according to officials from Time Warner, Microsoft and Google who declined to comment publicly, citing the confidential nature of the negotiations.

On the Time Warner side, there is no desire to sell AOL outright to Microsoft, since Parsons has said he views the Dulles-based division as an integral part of the corporation's overall media holdings. Parsons also has said that AOL will become more valuable as it continues to make the transition from a dial-up, subscriber-driven Internet service to more of a free, audience-based set of Web properties -- including AOL.com, Moviefone and MapQuest -- that profit from advertising.

Microsoft has no desire to enter into a joint venture or partnership with AOL unless America Online drops Google as its search engine and replaces it with MSN Search, according to people familiar with the talks. Microsoft, which would invest cash in any joint venture, is eager to expand the reach of its consumer presence online, Katz said. The goal is to establish a more robust Web-based way of distributing software online, just as Google does, he said.

The interest in AOL is a turnaround in the perception of the Internet service, after years of negative comments on Wall Street about its declining, dial-up subscriber base. AOL's move to establish the largest possible audience and profit from ads is in vogue these days, given the multibillion-dollar surge in online ad spending.

"The investor focus has turned back to eyeballs and the value of traffic on the Internet, especially value you can derive from advertising," said Marianne Wolk, an analyst with Susquehanna Financial Group. "And AOL has a large base of instant-messaging users and a large base of e-mail users."

But America Online, with an estimated 112 million monthly users across its holdings, also has profited handsomely from having Google as its search and ad partner in the United States and Europe. America Online has pocketed hundreds of millions of dollars annually from a deal in which it keeps more than 80 cents of every dollar from ads served up by Google to AOL users.

If no deal is struck between AOL and Microsoft, people familiar with the negotiations said, AOL and Google may enter into an expanded partnership that could take various forms. While the Microsoft-Time Warner talks are active and the primary focus, AOL officials are also talking to Google about various alternatives, sources said.

All of this activity is a reflection of the heightened state of competition between Microsoft and Google in a number of areas. And it appears that Time Warner's AOL unit may be in a good position to benefit from that rivalry by striking a new deal with one of the combatants.

Previously, AOL and Google have talked about various options that did not materialize, including the possible purchase one year ago of AOL's ICQ instant-messaging business by Google, sources said. ICQ is a leader in instant messaging outside the United States, with a strong presence in Asia, Europe and the Middle East.