The Huffington Post is just an aggregator. Nothing more.
So why is it worth so much?
Tim Armstrong and Arianna Huffington hosted a conference call with analysts this morning to discuss AOL’s announced $315 million acquisition of the Huffington Post. The Huffington Post is expected to contribute $50 million in revenues this year, and quickly ramp up to a $100 million revenue run-rate. That still represents a tiny portion of AOL’s $2.4 billion in revenue, but it is Armstrong’s largest acquisition to date, and his team believes it will help put AOL over the top in terms of putting the company on a growth track again by 2013 in terms of adjusted EBITDA.
It is clear that the deal is as much about buying into the new publishing model that the Huffington Post represents (which is in keeping with AOL’s acquisition of TechCrunch and emphasis on blogs like Engadget on the tech side). And it is about buying talent, both at the top and throughout Huffington Post on the editorial and sales side. Asked how long she plans to stay, Huffington says, “I told Tim I want to stay forever. This is my last act.” She has a multi-year contract at the very least, and AOL typically likes to structure deals with financial incentives that keeps top talent on board for at least two to three years. “Our only thing when we do acquisitions,” says Armstrong, “the price has to be fair, it has to fit the strategy, and the entrepreneurs have to stay.”If you wanted to make your company about content, which is what Armstrong keeps saying, then why would you buy a website that doesn't make anything original?
Would you continue to post on the Huffington Post for free, knowing the amount of money being thrown around? Would you surrender your 'content' to America Online, which has a poor reputation in the tech world and in the world of just basic common sense?
Of course not. And many of the celebrities currently using the Huffington Post to self-promote their wonderful selves are now going to have to reconsider. Celebrities working for free? Please.
The first real aggregator was The Drudge Report. It is still a low-tech, but high traffic affair. What is "created" there? Nothing.
The Huffington Post was a lefty aggregator. Sure, there is some content there. Much of it, however is stolen. And what isn't stolen is reproduced on other sites. It generates a lot of traffic because the people who are lazy gravitate to it for ease of use. If that's what you want, fine and dandy.
Here's what I do--I take what I like and make it fit on one of my blogs. I try to add value, I try not to steal anything, and I try to have fun. I often fail. I think what I have here is acceptably above the level of most of the crap out there. And my blogs are worth $500 million dollars. Why? Because they are not for sale. And something that is not for sale is either worth nothing or a fortune, take your pick.
Let's bear in mind that American Online still charges old people (yes, I'm old) who are not very savvy inordinate amounts of money for access to the Internet through a dial-up service. These same old people have cable providers, but don't use the broadband they have access to because no one has explained to them that if they bundle their Internet and television and telephone services, they won't need America Online anymore. And, yes, there are, in fact, people who have broadband through a cable provider and still pay America Online for access to...what, exactly?
To the stellar products America Online owns?
Jeebus.
Anyway, good riddance to the Huffington Post in its current annoying format. It cannot, and will not, remain a "lefty" sort of franchise. America Online cannot risk offending the blue hairs.
0 comments:
Post a Comment