$315 million from AOL to Arianna Huffington is a real eye-opener, and Zennie's written recently about how various blogs (including this one) are valued, but AOL has a history of getting things wrong, and this is surely a case 
of strange bedfellows (but hey, it's politics, right?) Consider that AOL's primary revenue stream remains their old-school subscribers, the messy divorce from Time-Warner, and the way their local news theory is - well - sputtering, thus far. Now AOL evidently hopes to capture the unpaid contributors and eyeballs that followed the drama of the 2008 elections. Good luck with that.
In an investor's ideal world, I suppose, they'd expect the HuffPo loyalists to stay interested, and the AOL subscribers to stay, and the buzz to generate more interest and more readers - right? More interest, more readers, more ad revenue, happy investors. It could happen, but I don't see it. Instead, AOL will further tarnish the already slipping HuffPo brand, driving HuffPo's core readers elsewhere (maybe here?) without significantly altering the AOL reader's habits. These are two utterly different groups of internet users.
The kind of folks who were enthused about what Huffington seemed to be about during the 2008 campaign cycle (and make no mistake about it, the rise is tied to Obama, Clinton, McCain and the most-watched campaign in history) are the sort of people who have disdained the AOL model since before the country had even heard of Monica Lewinsky. They'll go elsewhere, and AOL will be left holding the bag.
In fact, it's already begun. As reported Monday in the immediate wake of the wedding announcement, former Essence Editor
Angela Burt-Murray is now out of the HuffPost "Global Black" lineup. So, perhaps part of the appeal to AOL was Arianna's ability to come to terms with BET co-founder Sheila Johnson in an attempt to lure more African-American readership, but if you know why Ms. Burt-Murray departed Huffington's fold so soon after the AOL announcement we'd love to hear about it here, since AOL doesn't have the best track record in that department.
It's a triumph for Ms. Huffington, who has been very savvy in building and executing her business model. She sold out at a very opportune moment - and $315 million is a handsome profit - a remarkable return on investment. As such, this may even represent, or spark, the next hot wave of interest from big investors; it's clear that many stalwart media companies would benefit from some infusion of newer know-how, and tying their brand to an up-and-comer. But this unlikely union may well be the beginning of the end for HuffingtonPost's Happy Days.
Thomas Hayes is an entrepreneur, former Democratic Campaign Manager, strategist, journalist, and photographer who contributes regularly to a host of web sites on topics ranging from economics and politics to culture and community. You can follow him as @kabiu on twitter.
of strange bedfellows (but hey, it's politics, right?) Consider that AOL's primary revenue stream remains their old-school subscribers, the messy divorce from Time-Warner, and the way their local news theory is - well - sputtering, thus far. Now AOL evidently hopes to capture the unpaid contributors and eyeballs that followed the drama of the 2008 elections. Good luck with that.In an investor's ideal world, I suppose, they'd expect the HuffPo loyalists to stay interested, and the AOL subscribers to stay, and the buzz to generate more interest and more readers - right? More interest, more readers, more ad revenue, happy investors. It could happen, but I don't see it. Instead, AOL will further tarnish the already slipping HuffPo brand, driving HuffPo's core readers elsewhere (maybe here?) without significantly altering the AOL reader's habits. These are two utterly different groups of internet users.
The kind of folks who were enthused about what Huffington seemed to be about during the 2008 campaign cycle (and make no mistake about it, the rise is tied to Obama, Clinton, McCain and the most-watched campaign in history) are the sort of people who have disdained the AOL model since before the country had even heard of Monica Lewinsky. They'll go elsewhere, and AOL will be left holding the bag.
In fact, it's already begun. As reported Monday in the immediate wake of the wedding announcement, former Essence Editor
Angela Burt-Murray is now out of the HuffPost "Global Black" lineup. So, perhaps part of the appeal to AOL was Arianna's ability to come to terms with BET co-founder Sheila Johnson in an attempt to lure more African-American readership, but if you know why Ms. Burt-Murray departed Huffington's fold so soon after the AOL announcement we'd love to hear about it here, since AOL doesn't have the best track record in that department.It's a triumph for Ms. Huffington, who has been very savvy in building and executing her business model. She sold out at a very opportune moment - and $315 million is a handsome profit - a remarkable return on investment. As such, this may even represent, or spark, the next hot wave of interest from big investors; it's clear that many stalwart media companies would benefit from some infusion of newer know-how, and tying their brand to an up-and-comer. But this unlikely union may well be the beginning of the end for HuffingtonPost's Happy Days.
Thomas Hayes is an entrepreneur, former Democratic Campaign Manager, strategist, journalist, and photographer who contributes regularly to a host of web sites on topics ranging from economics and politics to culture and community. You can follow him as @kabiu on twitter.
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