AOL Up for Grabs

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AOL Up For Grabs

By: Jordan McCollum
2008-02-08

Despite continuing to acquire other companies, including Goowy and Buy.At marketing network, it looks like AOL is seriously losing steam.

Time Warner CEO Jeff Bewkes announced today that the company would be undergoing major restructuring.

Bewkes said that theyve already begun to split AOL into two divisions, one focused on advertising (presumably still called Platform A, as announced in September). The other, which I think will retain the AOL brand and subscribers, will be spun off and possibly sold.

CNNMoney mentions some of the reasons that Time Warner is shedding the company it acquired eight years ago:

"The company saw a 32% plunge in revenue at AOL, as it lost 29% of the subscribers it had a year earlier. Operating income at the unit tumbled 70% due to the sale of its Internet access business in Great Britain and France."

However, AOLs unit did beat expectations. On the other hand, I wouldnt go as far as to agree with Bewkes, who said that Microsofts Yahoo bid demonstrates the value of AOL, since Yahoo is a competitor of AOL.

MediaPost reports that suitors for the company would include Comcast and eBay. Presumably, theyre interested in the advertising unit, but it hasnt been confirmed that Platform A and AOL would both be for sale. It certainly sounds like splitting the advertising business off from the main AOL business would indicate that Time Warner wants to keep Platform A (or at least sell them seperately).

Additionally, Bewkes said that the split could take several more months because its fairly complicated.

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About the Author:
Jordan McCollum is a staff writer for the popular marketing blog Marketing Pilgrim. She has worked in search engine optimization with clients including 3M, Little Giant Ladders and ADP. After graduating from Brigham Young University, Jordan joined the SEO copywriting team at the Internet marketing firm 10x Marketing. After 10x closed its doors in December 2006, Jordan became a freelance writer and Internet marketing consultant specializing in SEO. She also has extensive experience with web analytics, conversion rate enhancement and e-mail marketing.


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