The Truth Behind AOL’s Acquisition of The Huffington Post

Mar 14, 2011  •  Post A Comment

Traffic figures provided for AOL’s major media brands in a recent report reveal the real reason behind AOL’s recent takeover of The Huffington Post, according to an analysis on Bloomberg’s Businessweek page.

Mathew Ingram writes in the piece: “When AOL Chief Executive Officer Tim Armstrong announced the $315 million acquisition of The Huffington Post several weeks ago, he made the deal sound like a nice strategic add-on for the former Web portal’s content business–an expansion of the successful branded-media strategy the company has been rolling out for the past year. In reality, however, buying Huffington Post was something AOL had to do, because traffic has been plummeting and losses increasing at most of its major media properties, including the ones it has been banking on to help create a future for the company.”

The piece examines traffic statistics found in a report from ComScore, and concludes that the numbers paint a dismal picture for AOL. “For some AOL sites, the number of unique visitors in February (a much more precise measurement than page views) was down by more than 40 percent compared with the same month a year earlier,” the story reports. “AOL Games, for example, saw the number of visitors to the site drop by almost 50 percent. Even more ominous was the decline in readership at sites such as DailyFinance and PoliticsDaily, two sites that AOL has been pinning much of its content hopes on.”

AOL eliminated more than 200 editorial staffers as part of a big layoff last week, the story notes, adding that the total damage was 900 jobs, or about 20% of AOL’s work force. The losses included many of the writers for DailyFinance and PoliticsDaily, the story reports.

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