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October 25, 2014

The New HuffPo-AOL Combo: The Free, Anti-Murdoch Alternative?

Today, it seems like the only people willing to stake out boldly the future of American digital news media aren’t, by birth, American. There’s Rupert Murdoch, of course, who now heads the world’s largest news company, and is the face of The Daily. There’s Tina Brown, who has fashioned a hybrid zorse of sorts, as her Daily Beast mates with Newsweek. And, of course, there’s Arianna Huffington, who now has traded up, selling her very name and company for a payoff both financial and political. In fact, it makes us wonder how strongly new soulmates (doesn’t the two-shot of the new partners offer an eerie reminder of the Steve Case/pained Jerry Levin shot from the 2000 “merger”) Arianna and AOL CEO Tim Armstrong want to embrace a big, new position in the marketplace.

A logical position: We’re the new free, anti-Murdoch alternative! At at a time when News Corp, the New York Times and dozens of others U.S. newspapers are “going paid,” about to erect porous (metered) and solid pay walls, taking a free position can be clear to mass audiences confused by what wall they may run into here or there. Imagine the new AOL/HuffPo ad soon after the New York Times goes metered — best in the Times itself:

Come Visit Us

Anywhere

Anytime

FOR FREE

That kind of position may fit well with Tim Armstrong’s mantras and manifestoes. If the former head of Google advertising really believes he can more efficiently monetize digital content than his various competitors, then he bets the company on it. Forget the two legs of revenue — advertising and circulation — that the old guys want, we’ll just focus on the fastest growing kind of advertising in the country and the world, digital, and do it better than anyone else. He’s got a major issue with that, of course, pointed out by many observers. The new independent AOL is not (yet) climbing the digital ad mountain quickly enough. In fact, its last report showed continuing year-over-year declines.

Execution must match up with strategy, and now given the HuffPo purchase for $315 million, sooner than later. One key question there: where exactly is AOL’s mobile push? Its apps are anemic, still focused on instant messaging, and so far lacking for Patch, this as the location-aware mobile marketing revolution takes flight.

Advertising execution may be key, and today Tim Armstrong put a new face on his brand. In fact, given the announcement that Arianna will head editorial operations overall, we’re unclear how much the going-forward brand is in fact AOL or HuffPo, or some nested version of the two, a nesting that would probably only confuse the marketplace and readers more.

Make no mistake. Armstrong needed to put a face on the brand, for AOL, overall, has been faceless. Sure, Armstrong is well-known among media people, but not more widely. AOL, like Yahoo, suffers from portalitis,a big grab-bag of topics and sites that don’t have a common consumer promise. (It’s no accident that both showed revenue drops, as digital advertising is going gangbusters again in the recovery.) With Egypt exploding over the last couple of weeks, it was CNN, Al Jazeera, the Times, the BBC and the Guardian that people turned to. No one said, I’ve got to see what AOL has out of Cairo.

Ah, but what kind of new face will AOL/HuffPost’s be?

It could be, simply, the anti-Murdoch. Sure, The Daily is “centrist,” whatever that means in the world of 2011, but the right-leaning proclivities of Murdoch Media are clear. MSNBC has tiptoed into the “anti” position, leaning forward gingerly, but then wrapping itself in knots over small campaign contributions. Arianna could simply embrace the left end of that spectrum, porting over her passion and partisanship, the very elements that have defined her Post, the fastest growing news site on the web (“The Newsonomics of HuffPo’s Pinball Wizardry“. In fact, if she doesn’t bring along what got her to where she is, then what exactly is AOL buying and where will her core audience go?

Would Tim go for it? Yes, if it makes money, as we saw clearly in the leaked AOL Master Plan. For Armstrong, it’s simply about the efficiency of the markets, bringing state-of-the-art digital manufacturing techniques to the old standbys of editorial and advertising. He needs lots of content — some from highly paid names and lots more from good-enough user gen — and must get his machine (better SEO, more pageviews per story, lots more lucrative video) tuned before he runs out of money. Just one suggestion for a short-term moneymakers: pay-per-view web video of Arianna’s first meetings with Techcrunch’s Michael Arrington and Engagdet’s Joshua Topulsky. Bonus WWE prices if she talks to them together.


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