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AOL/HP: Parsing the AOL and Huffington Post Merger

Posted by Sheila Shayon on February 7, 2011 05:30 PM

Late last night came word that AOL is buying Huffington Post for $315 million. Early this morning came more words, via the parties' conference call with journalists and analysts, about what exactly the deal means for both brands.

The call, with AOL CEO Tim Armstrong, his new editorial czar Arianna Huffington and AOL CFO Artie Minson, flush from announcing their deal at the Super Bowl, sounded like they were fresh from one of last night's XLV commercials.

The deal, declared Huffington, “is a dramatic accelerator. We’ve just gotten off a fast train and on to a supersonic jet.”

Armstrong added, “HuffPo is one of the best Internet properties to partner with and build a global media company with engaging content. Together we can leverage Internet firsts: global, national and local focus; women’s content. It’s the 80/80/80 combo of women, local and purchase.” (That math recalls former AOL head Steve Case's tweet, which he later retracted.)

“Self-expression is the new entertainment," Huffington noted. "Citizen journalism is allowing people world-wide to find a voice. Legacy media doesn’t get it. People are spending enormous amounts of time on Facebook and HP – interacting for free."

At least we have our acronym for the merged entity: AOL/HP! Shades of AOL/TW?

HuffPo, noted Huffington, has created a “fully socialized” environment with increased engagement – we had 4 million comments last month, and with 30 comment moderators, we’ve created a civil environment for consumers and advertisers. We’re earning the trust.” (Of readers, maybe, judging by today's comments; but of its many unpaid contributors? That remains to be seen.)

Armstrong commented that he needed an editorial czar to help make his aggressive content goals pay off: “We wanted a partnership ... We wanted Arianna inside the building.”

Huffington says her site “was not for sale. We have a small board, we believed in an IPO down the road, but Tim provided the opportunity at the right time. HuffPo began as a political blog five and a half years ago, but now only 15% of our traffic is political. We have 26 sections and the latest, (the Nora Ephron-helmed) Divorce, is the 7th most trafficked. Our college section has professors blogging from Yale and Wesleyan – as well as students. The platform is consistent, available."

She also talked up her recent big hires, implying that HuffPo is not all unpaid bloggers but, increasingly, world class journalists: "Top editors like Howard Fineman from Newsweek and Peter Goodman from the New York Times combined with young reporters just out of college, being mentored by these experienced editors. We want to focus on what is working, local solutions not national failures, like the 'greatest person of the day' on Patch, a content platform of citizen journalism that lets people feel empowered, engaged, giving back and being of service like our cause-marketing section, Impact."

“Success in the Internet space requires three things: a specific vision, execution and technology; content that is national, local and global, and as the world gets bigger and connectivity gets faster, people will navigate by brands; staying on strategy – we’ll over-communicate with our employees and our customers and deliver value to the ecosystem," stated Armstrong.

"HuffPo is the best Internet brand there is – along with talent and entrepreneurial spirit. Platforms like (AOL's algorhythmic content mill) Seed and (video arm) StudioNow will enable the new company to cover all elections and serve advertisers with content. HuffPo’s technology is synergistic and high tech in the content space – 24/7 global engineering.”

As for Arianna’s future with AOL and how long she’ll stay, Armstrong would like her “to stay forever.” She responded, “It’s my last act, my dreams are here. High-quality content in cost effective ways.” 

Who's not staying: HuffPost CEO Eric Hippeau, and ad sales chief Greg Coleman.

As for how long the honeymoon last and how this all plays out, one has to wonder: will the Huffington Post brand (and ego) overshadow The AOL Way — and how will renowned left-leaning Huffington get along with conservative Armstrong?

 

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