AOL tries to boost presence with Huffington Post buy


Associated Press

AOL Inc., once the king of dial-up Internet access known for its ubiquitous CDs and “You’ve got mail” greeting in its inboxes, is stepping up its efforts in news and online advertising with a $315 million deal to buy news hub Huffington Post.

The acquisition announced Monday is among the most aggressive strategic moves engineered by AOL CEO Tim Armstrong in an effort to reshape a fallen Internet icon.

Perhaps just as important as picking up a news site that 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.

After the acquisition closes later this year, Huffington will run AOL’s growing array of content, which includes popular technology sites Engadget 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.”

Putting Arianna Huffington into a position of power also could eventually threaten Armstrong’s job security if AOL still struggles, Enderle said.

In a blog post about the deal, 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. She said the deal was signed at the Super Bowl in Dallas, which she and Armstrong attended.

The Huffington Post, which now draws 25 million monthly visitors, has built its popularity by bringing together news from a wide selection of other media outlets, linking to articles and video on everything from politics to style to food. It even has a new section on divorce.

It combines that type of aggregation with original work by its own small staff and blog posts from celebrity contributors who work for free in return for a platform to express their opinions. Robert Redford has written for the site, along with Bill Gates, President Barack Obama and several university presidents.

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.

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