According to CEO Tim Armstrong, AOL is probably the largest newsroom in the world. With a staff comprised of 4,000 journalists, it's hard to quibble with that estimation. 

But over the next year, AOL will have to make a lot of changes if it wants to follow through on its new brand promise to "beat the internet."

Speaking with TechCrunch's Michael Arrington at TechCrunch Disrupt in New York on Monday, Armstrong reiterated his idea that AOL needs to fundamentally change the way it has been doing business.

He says that when he came in a little over a year ago,"the AOL employee base was sick of losing."

According to Armstrong, he's spent the last few months getting the company up to speed:

"One thing I spent the first year doing was unlocking the company's ability to make decisions and compete."

That's because despite being one of the largest content creators on the web, AOL wasn't always the dominant player anywhere. Part of the problem, says Armstrong, lay in the way AOL measured success:

"The company had been measuring itself against itself."

But Armstrong wants AOL to produce better content than every other digital property out there:

"It's not what we did last month, it's what the industry is doing, and what we can do better."

The company's new slogan is "Beat the Internet" and Armstrong considers it an imperative that must be ingrained across the company's divisions.

"Beat the internet isn't just a marketing phrase," says Armstrong. He's now holding every AOL division accountable for its performance, from ad sales to legal.

But the area that everyone is watching right now is AOL's content creation arm. That's because Armstrong has repeatedly reiterated his intent to make AOL "king of content."

"We see content as a way to fund our properties and others who we partner with,” says Armstrong. “To do that, we’re focusing on quality."

That's one reason Armstrong's doesn't seem to mind the fact that Yahoo recently bought Associated Content, a SEO friendly content producer. Armstrong is an investor in Associated Content, but he doesn't see them as competition. He also takes offense at the term "content farm." He told Arrington:

"I think ‘content farm’ is a negative term. A lot of the content we’re creating fits in a lot of different buckets. Some of it does have commercial viability, some doesn’t. I hear our competitors only talking about commercial content. We have 500 full-time journalists and 3,500 part-timers. I think our model will work... Content isn’t a zero sum game: it can be great for us and for our partners. The content engines we’re building should enhance our properties’ qualities, as well as others.”

Asked about Carol Bartz' estimation of AOL as a "mini Yahoo," he said:

"If she meant the company has a tighter, more concise strategy, then she's right. If we have a mini strategy, that's probably a positive.""

But the biggest issue for AOL's content strategy is that it needs to start paying off soon. The company still gets most of its revenue from a slowly dying dial-up business.

Last year, the access business brought in $100 million, but that number is declining by 1/3 annually. Says Armstrong:

“We’ve been trying to separate that out and get the other parts to be self-sustaining.”

Armstrong's not ready to disclose a date when AOL will be freed of access revenue, but one of the first orders of business will be to improve and pare down AOL's massive content properties. Armstrong has said that some brands will be cut.

Social network Bebo, for instance, was acquired by AOL for $850 million two and a half years ago. Armstrong says that acquisition was a major distraction, and it may soon be shut down or sold.

Another pressing concern across AOL is which properties will grow and which will be cut in the coming months. Says Armstrong:

"Some of the brands should be features in others. We're now determining what should be features, and what should be brands."

Image: AOL

Meghan Keane

Published 25 May, 2010 by Meghan Keane

Based in New York, Meghan Keane is US Editor of Econsultancy. You can follow her on Twitter: @keanesian.

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Comments (1)


email marketing

I am dating myself but I still remember my father calling me into the computer room, and showing me AOL in its infant days.  It was expensive and unique.  Everyone wanted AOL. I believe to give credit where credit is due.  It is because of their wonderful program, the email craze exploded in the way that it did.

Through mergers and strategies and mistakes (with Time Warner Cable) it is now independent again, thrown in a sea of wolves.

I give Armstong credit for his public courage.

I am sure many of us are anxious to see if this sleeping dog can not only be revived, but enabled to thrive in such heavy and aggressive Internet Global competition.

about 8 years ago

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