AOL Buying Huffington Post for $315M
- Posted on February 7, 2011 at 5:42am by
Scott Baker
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Online company AOL Inc. is buying online news hub Huffington Post in a $315 million deal that represents a bold bet on the future of online news.
The acquisition announced early Monday puts a high-profile exclamation mark on a series of acquisitions and strategic moves engineered by AOL CEO Tim Armstrong in an effort to reshape a fallen Internet icon. AOL was once the king of dial-up online access known for its ubiquitous CD-ROMs and “You’ve got mail” greeting in its inboxes.
Perhaps just as important as picking up a news site and ranks as one of the top 10 current events and global news sites, AOL will be adding Huffington Post co-founder and media star Arianna Huffington to its management team as part of the deal.
After the acquisition closes later this year, Huffington will be put in charge of AOL’s growing array of content, which includes popular technology sites Endgadget and TechCrunch, local news sites Patch.com and online mapping service Mapquest.
The price that AOL is paying is “really just the hiring fee to get Arianna,” said technology analyst Rob Enderle. “This is one of those out-of-left-field moves that actually makes a lot of sense. This could put AOL back on the map.”
Armstrong, a former Google Inc. executive, has been trying to turn AOL into a go-to place for a wide variety of news since he was hired to turn around the company in April 2009 while it was still a part of Time Warner Inc. The makeover is designed to give Web surfers a reason to visit AOL’s websites more frequently to help boost online ad sales.
At the same time, Armstrong has laid off hundreds of employees in an effort to boost AOL’s financial performance and stock price. It has been a slog so far. AOL lost $782.5 million last year, largely because of accounting charges, and the company’s stock is now worth slightly less than after it was spun out of Time Warner 14 months ago.
The deal “will create a next-generation American media company with global reach that combines content, community, and social experiences for consumers,” Armstrong said in a statement announcing the deal.
Founded in 2005, Huffington Post is owned by Arianna Huffington, Kenneth Lerer and a group of other investors. The site attracts 25 million monthly visitors. AOL will pay $300 million of the purchase price in cash.
Putting Arianna Huffington into a position of power could eventually threaten Armstrong’s job security if AOL still struggles, Enderle said.
“This is a gutsy move (Armstrong’s) part because Arianna could end up running AOL,” Enderle said.
In a blog post about the deal, Arianna Huffington praised Armstrong’s vision for AOL and said they were on the same page as they discussed their ambitions for online news. “We were practically finishing each other’s sentences,” Huffington wrote about their discussions. She wrote that the deal was signed at the Super Bowl in Dallas, which she and Armstrong attended.
If it wins expected regulatory approval without any hitches, the deal will likely close in late March or early April.
Armstrong has been an aggressive deal maker since his arrival, but this marks by far the biggest acquisition of his tenure. Various published reports quoting unidentified people have also said he has talked to private equity firms about the possibility of trying to buy Yahoo Inc., another struggling Internet pioneer that remains a household name. Yahoo CEO Carol Bartz, though, has shown little interest in working with AOL.
AOL had just a 5.3 percent share of the U.S. display advertising revenue in 2010, down from 6.8 percent in 2009, according to eMarketer. Facebook, meanwhile, accounted for 13.6 percent of display revenue last year, up from 7.3 percent in 2009.
Huffington Post grew quickly from startup to online colossus and ranks as one of the top 10 current events and global news sites. Over time, it launched city-specific pages and developed a roster of sections such as food and books. The work of its 70-person paid staff is augmented by content from news outlets and 6,000 bloggers who write for free.
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Comments (156)
Mister_Bill
Posted on February 7, 2011 at 8:01am“This is one of those out-of-left-field moves that actually makes a lot of sense.” Technology analyst Rob Enderle. “This could put AOL back on the map.” Boy that says it all. If that is the price, then the Blaze must be worth Billions. Question – It Arianna takes over mapquest how will you ever make a right turn? I know two wrongs do not make a right, but will Two Lefts makes a Right?
Report Post »UpstateNYConservative
Posted on February 7, 2011 at 8:37am@Mister_Bill
That depends on the tax rate.
And, no–you can’t ask me of any logic here, while I’m having a liberal moment.
BTW–did you hear what Sarah Palin said when she was three years old?
Report Post »MilitaryDad
Posted on February 8, 2011 at 6:43pmNo, it takes 3 lefts to = a right… LOL
Report Post »dablooz
Posted on February 7, 2011 at 8:00amI went over to HuffPo and read some of the comments on this. I didn’t know AOL was “minority, gay. and progressive unfriendly”. Who’d of thunk it?
Report Post »UpstateNYConservative
Posted on February 7, 2011 at 8:11amAwwww! Poor babies! Where’s my violin…?
Report Post »decendentof56
Posted on February 7, 2011 at 7:58amupstatenyconservative
Report Post »(to); navymommy…..They‘re so far left they can’t see even the middle.
As Larry the Cable Guy would say…….”Now you know that’s damn funny”
Legal Immigrant
Posted on February 7, 2011 at 7:52amHere‘s hoping she gets bent in the boardrooms as payback for what’s been done.
Take your money, take Soros and GTFO.
Report Post »hillbillyinny
Posted on February 7, 2011 at 7:51amDidn‘t even know AOL still existed and can’t believe they have a “news” department. I remember Huffington Post when it was founded–I was grass-roots lobbying in Washington for family farming and they were passing “flyers” out on the corners. Didn’t know what it was all about, but heard a “suit” say, “Don’t bother to take one of those, it’s just that rag, HuffPo. They’re in left field or was that right field or actually just out in the woods. . . ” Around the time of BO being championed, I was shocked to find that the HuffPo still existed and thought they were “highly respected”!
Report Post »lot21
Posted on February 7, 2011 at 7:45amAOL still exists?
Report Post »Mister_Bill
Posted on February 7, 2011 at 7:35amHey UPSTATENYCONSERVATIVE, “wonder how long it will take the trolls to respond to this thread, saying they ‘need a fair and honest counter-balance’ to Glenn, Rush, Sarah, etc.”
Report Post »They still need a ‘need a fair and honest counter-balance’. For research purposes I like to see what is on the site and Edward Bernays would be proud. These are the most slanted media I have ever read. If there is a post that is not “the party line” there is no discussion, they just try to kill the messenger. Facts do not count there, only what the great “Leader” says. Just like in China.
canuck44
Posted on February 7, 2011 at 7:23amAOL has long been a progressive driven website although they have done their best to appear otherwise. This is really just the progressives getting together to minimize their losses. The twelve remaining people that use AOL as a homepage will soon be replaced by outright Marxists. This is just a bigger choir singing and preaching to an aging and diminishing congregation.
Report Post »DivineMomentsOfTruth
Posted on February 7, 2011 at 11:04amAOL uses AP Leftist headlines news proudly.. Watch how even further to the Left it swings during Presidential elections.. It’s beyond bias.. It’s misleading and lying headlines.
Report Post »Ella
Posted on February 7, 2011 at 7:22amMy first reaction was, I‘m glad my interenet provider isn’t AOL or I’d have to change them. So AOL is also a left wing organization. I cancelled comcast many years ago becasue they were awful, They couldn’t fix a problem I had for anything. It was just like the old Abbott and Costello comedy routine, “Who’s on First.”
Report Post »eflow504
Posted on February 7, 2011 at 7:22ambye bye AOL…..
Report Post »NancyBee
Posted on February 7, 2011 at 7:44amYou got that right!
Report Post »Bookster
Posted on February 7, 2011 at 7:07amAs if there weren’t enough reasons to avoid AOL like the plague.
Report Post »awizard
Posted on February 7, 2011 at 7:03amAOL still exists?.. I made a lot of money off of them a few years ago … Fixing peoples computers after they installed their software!..
They can’t be capitalists, they haven’t made any money for a long time.
Report Post »rodamaa
Posted on February 7, 2011 at 8:43amI say, watch the other hand. Typical tactics from the left. I have shied away from AOL for twenty years, now I know why.
Warning
Report Post »I say, watch the other hand. This are typical tactics from the left.
blanco
Posted on February 7, 2011 at 7:01amCan you tun it around to a more respectable news organization now?
Report Post »goobert
Posted on February 7, 2011 at 7:01amIs anyone still using AOL?
Report Post »lillianrose
Posted on February 7, 2011 at 6:59amThey paid way too much! It should have sold for $1. I am sure there is more to this sale that is not being let known.
Report Post »UpstateNYConservative
Posted on February 7, 2011 at 6:59amI wonder how long it will take the trolls to respond to this thread, saying they ‘need a fair and honest counter-balance’ to Glenn, Rush, Sarah, etc.
Report Post »UpstateNYConservative
Posted on February 7, 2011 at 6:54amNow we know who to boycott next.
Report Post »Marylou7
Posted on February 7, 2011 at 6:52amNo more Mapquest for me. Glad I don’t have AOL.
Report Post »MilitaryDad
Posted on February 8, 2011 at 6:32pmNo more Mapquest or Engadget… and another fact I found interesting was that Jeff Zucker said NBC had been trying to acquire HuffPo… now why would a ‘neutral and professional’ news organization be interested in an overtly and openly Left-Wing group???
Report Post »jedi.kep
Posted on February 7, 2011 at 6:44am“AOL lost $782.5 million last year, largely because of accounting charges, and the company’s stock is now worth slightly less than after it was spun out of Time Warner 14 months ago.”
And you think that obtaining the HUFFINGTON POST is going to turn things around for you? You simply are not the brightest crayon in the box now are ya? One brick short of a load? One banana short of a bunch? One french fry short of a happy meal?
As my son would say….FAIL!
Report Post »flattop
Posted on February 7, 2011 at 6:35amApparently money means more than ideology to AH. Not the first time she’s sold her soul. I can’t think of a better casting for a remake of Green Acres, dahling.
Report Post »beckisnutsisnuts
Posted on February 8, 2011 at 12:49pmLOL, yea, and they can get Sgt Schultz to play her husband!!
Report Post »hooklinesinker
Posted on February 7, 2011 at 6:22amGreat now more people can get false news and mislead more easily, AOL more like
Report Post »LOL.
the_ancient
Posted on February 7, 2011 at 6:19amSeems like commenter’s at HuffPo seem to think this is a grand right wing conspiracy
Report Post »Navymommy
Posted on February 7, 2011 at 7:03amI’ve been reading that too. They accuse her of being a closet right winger. They must be so far left they can’t even see the right.
Report Post »UpstateNYConservative
Posted on February 7, 2011 at 7:14am@Navymommy
They‘re so far left they can’t see even the middle. In a week, I bet, they’ll be calling Arianna a Nazi.
I hope all their heads explode over this.
Report Post »Highland
Posted on February 7, 2011 at 7:25amThe screamers at HuffPoo aren’t much different from those at DemUnderground – whining little children.
Report Post »Welcome Black Carter
Posted on February 7, 2011 at 8:36am“left leaning” ????? If the huffpo took a step to the left would they not stepping off the planet?
Report Post »ValiantDefender
Posted on February 7, 2011 at 10:58amAgreed. I remember reading an article on the huffpo about how to use the trains to get to 8/28…or more specifically, how they made fun of people who made a flyer to helpe people.
In the flyer it says to avoid certain areas (they were high crime areas). The HuffPo tried to make it out as nothing less than racism…because the high crime areas happen to be predominantly minority neighborhoods. Give me a break! They said high crime areas…is that not reason enough to avoid those sections of town? The HuffPo people are idiots. Every article I’ve read on their site has this same hateful overtone. I Hope they sink!
Report Post »Fina_Biscotti
Posted on February 7, 2011 at 11:52amMy friend Pat said…..they have gone so far Left, they fell over.
Report Post »the citizen
Posted on February 7, 2011 at 6:14amInteresting, I didn’t think Arianna would ever sell it.
Report Post »Jarski
Posted on February 7, 2011 at 6:21amShe’s not selling HuffPo. She’s buying AOL and getting paid to do it. Dadgum captalist.
Report Post »OutOfTheAether
Posted on February 7, 2011 at 11:24amThat’s how I read this, too
Report Post »Cobra Blue
Posted on February 7, 2011 at 5:56amThrowing more good money after bad….
Report Post »justanamerican
Posted on February 7, 2011 at 8:17amIm sure Arianna is donating it ALL to fighting global warming, poverty, and other liberal causes,.. in the US and Abroad…………Right ????????????
Report Post »Robert-CA
Posted on February 7, 2011 at 12:08pmPlease AOL also include in the contract the loon bloggers & ship them to your companies in the far east .
Report Post »grandmaof5
Posted on February 7, 2011 at 5:53amOh goodness, Arianna, was that a capitalist move? I hope you are planning to redistribute that money to the less fortunate because she is now worth 10 times more than Glenn. Time for a take-down of the Huffington Post and AOL all you rightous bloggers.
Cobra Blue
Posted on February 7, 2011 at 6:04amDon’t you know capitalism is only DIRTY when conservatives are involved in it. For liberal progressives…its a smart financial move.
Report Post »Jarski
Posted on February 7, 2011 at 6:18amAOLOL. Hopefully this costs AH more than it benefits her.
Report Post »NickDeringer
Posted on February 7, 2011 at 6:34amI love it when rich liberals tell us how noble it is to be poor.
Report Post »blanco
Posted on February 7, 2011 at 7:02amShe follows party lines, therefore, she gets to keep her wealth!
Report Post »royrescue
Posted on February 7, 2011 at 7:02amScott Baker is on 104.7 pittsburg,and until 10am et. http://www.wpgb.com THANK YOU Scott and The Blaze!
Dustyluv
Posted on February 7, 2011 at 7:11amI havent used AOL since I got rid of dial up in the 90s What a waste of the internet…
Report Post »But I am sure a lot of these literal marxists still use dial up…
River0
Posted on February 7, 2011 at 7:29amGeorge Soros has pumped over $500 million into the Puffington Host. He bankrolled Arianna years ago, and even after all this time, their revenues are pitiful. It’s being made to look like a shrewd deal in order to save face.
Report Post »easyed598
Posted on February 7, 2011 at 7:54amPerhaps AOL should usurp the abbreviation LOL and rename the meaning to “Leftist On Line’
Report Post »easyed598
Posted on February 7, 2011 at 8:01amAOL would have been much wiser letting Fox News buy into them. It would have brought million of more customers back to AOL and would have been more Fair and Balanced.
Report Post »OutOfTheAether
Posted on February 7, 2011 at 8:06amhmmm, let me see if I have this right. AH gets 500 million from Soros, then turns around and gets another 315 by selling it, and gets to go with it to boot! In a spot that may put her in the driver seat as well. It’ now wonder HuffPo bloggers are crying foul. This has CAPITALIST written all over it.
OR.. maybe
Wonder how much Soros muscle, er ..influence, er…advising was behind this whole thing?
Report Post »UpstateNYConservative
Posted on February 7, 2011 at 8:17am@OutOfTheAether
Yeah, well…In other news, Sarah Palin once said when she was 12….
\sarc
I am so curious to read what the usual trolls who post here write about this HuffPo thing. I expect it’s going to be comedy gold.
Report Post »Rogue
Posted on February 7, 2011 at 9:56amLike Dusty, I tried to drop AOL back in the ‘90’s. Worst customer service on the planet. After 6 months of calls, terrible customer service reps, and 6 months of continuous charges as I tried to cancel, I had to deactivate my credit card just to get the charges to stop. They threatened legal action once they couldn’t charge my card anymore. I hope Huuf N’ Puff runs them right into the ground, nose first.
Report Post »GhostOfJefferson
Posted on February 7, 2011 at 11:03amYou’ve Got…Propaganda.
Report Post »ThoreauHD
Posted on February 7, 2011 at 11:36amAnother socialist failure. On the plus side, she got more than the $1 that Newsweak got.
Report Post »Lantern
Posted on February 7, 2011 at 11:48amI never understood how AOL even lasted this long? Back in the days before internet got big, you needed a place where you could dial up and have email. That has not been needed in 10 years. You can sign into free email, as long as you have an ISP. Only the very stupid now need AOL.
Report Post »d55may
Posted on February 7, 2011 at 1:12pmI can’t believe anyone here has not considered that AOL has been a part of this all along. The company paid a lot of money to get Obama elected. Huff is just going underground because the election is coming up. They (progressives) have more people in their pockets then any of us realize.
Report Post »AmeriWoman
Posted on February 7, 2011 at 2:57pmThey’re paying 134,999,999.99 to much for it.
AW
Report Post »N5DVC
Posted on February 7, 2011 at 3:59pmCurious. Why would a ‘neutral’ news organization want to dramatically expand their influence “in time for the 2012 elections”??
Report Post »Tipped her hand a bit there, eh?
johnnyvaughn
Posted on February 7, 2011 at 4:17pmI think this is a good move. Disliking AOL, this will help them crash. Everything the lefties get involved with gets slammed.
Report Post »SLAPTHELEFT
Posted on February 7, 2011 at 4:31pmOh she’s such a capitalist. Arianna, wanna see how the free market works? I’ll show you. I’m gonna let everyone know that you are now in charge of AOL content. Hope it works for you. I bet you’ll be sorted out by the free market within a year.
Report Post »SLAPTHELEFT
Posted on February 7, 2011 at 4:33pmAfter all of sugardaddy georges money has been wasted, this is a short sale!
Report Post »DisillusionedDaily
Posted on February 7, 2011 at 6:08pmIt seems to me that the cash outlay was about $299,999,999.99 too much.
Report Post »THIS GENERATION
Posted on February 7, 2011 at 7:09pmheadsup….i was with comcast, left there because they changed their email format. wrote to comcast, told them my reason for leaving, they replied saying basically ‘tough’. i went to AOL, liked it now they will get their news from Huffington Post….. WHAT? a Leftist propganda news….NO WAY. so i departed AOL to GMAIL. for now anyway until something better comes along. be careful who we support, directly or indirectly.
Report Post »Jackers
Posted on February 8, 2011 at 9:26amSo Arianna Huffington sold out to the big bad corporation of AOL… I thought all of these Progressives were against capitalism and “big bad” for-profit companies… What gives?
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