Just how desperate is AOL for some magic cure? The troubled New York internet portal, which just fired its advertising boss because he wouldn't sign up to ridiculous revenue targets, has bought one of those hip social network sites. Bebo, too expensive for other potential acquirors, is to go to the Time Warner internet unit for $850m. Bebo is popular among UK teenagers, particularly those with suicidal tendencies.
AOL CEO Randy Falco just announced to employees that AOL will buy the social network Bebo. News.com reports AOL paid $850 million. In the memo, Falco claims the acquisition "puts us squarely in a leading position in social media at a time when it's growing at a fantastic rate." Incorrect. We may not know what "social media" means, but we know how to define "leading." And the only thing Bebo leads in is down time. As of February 26, Bebo led all social networks with 12 hours and 28 minutes of down time since the beginning of 2008. Here's Falco's delusional memo in full.
Curt Viebranz, fired as president of AOL's sales arm after just half a year, may have lost a struggle with the internet portal's bosses. But he's unlikely to be the last executive casualty at the Time Warner unit, New York's biggest internet business. Alley Insider reports Viebranz may have been fired because he refused to sign up to unrealistic ad sales targets. But why were the bosses' expectations so unreasonable?
Curt Viebranz, the CEO of AOL's ad sales unit Platform A, is leaving. AOL did not say why, but "sources" are suddenly tipping off a lot of blogs that he was fired. Viebranz, former head of Tacoda, joined Platform A at its inception last fall. The unit was supposed to house ad sales for all AOL units. Another AOL executive, Advertising.com president Linda Clarizio, will replace him. Advertising.com execs strongly opposed the Tacoda acquisition, saying Tacoda's technology was overrated. Guess who just won that argument?
Yahoo CEO Jerry Yang and Time Warner CEO Jeff Bewkes want an AOL-Yahoo merger that would give Time Warner a large minority stake in the new company. The idea is that joining Yahoo and AOL — which itself plans to add a dozen new sites in the next six months — would create the dominant online advertising company. OK, maybe. If you're not counting search.
You might hate your job, but you've got it better than the office plants at AOL's former headquarters in Dulles. A tipster writes:
What does AOL topper Randy Falco think of Microsoft's hostile Yahoo takeover? He hopes it bloodies both parties and Google, too. "I hope they beat each other's brains out over search and leave the display market to us," Falco said at the IAB conference. He cited the wisdom of a role model: "I think it's a mistake. But I think Napoleon said never interrupt your enemy when they're in the middle of making a mistake." Falco hasn't been this nasty since he mocked laid-off AOL employees last Christmas. What gives?
Time Warner and Viacom video content will soon run on Hulu, the Web video joint venture from NBC Universal and News Corp. The Time Warner deal is done, while Viacom's is "not totally signed," a source tells us. Both deals are said to be nonexclusive. (A Hulu spokesbot autodialed us to relay the nitpick that the paperwork hasn't been signed yet. Whatever.) The news isn't a shock: Time Warner subsidiary AOL agreed to distribute Hulu at launch and before the site even had a name, Viacom executives have praised Hulu in concept. Just yesterday, MTV exec Van Toffler said, "We've been talking to [Hulu] since the beginning, and we like it a lot." Mostly because it's not YouTube, of course.
Goldman Sachs and Lehman Brothers advisers have CEO Jerry Yang and the Yahoo board of directors talking a merger with AOL, according to the Times of London. Last week, new Time Warner CEO Jeff Bewkes announced plans to formally split AOL from its ISP business, in a move that he said would "increase AOL's strategic options." The Times also reports Yang and company plan to test interest from Disney.
Former Tacoda CEO Dave Morgan has quit AOL exactly three months after being named EVP of global advertising strategy. Morgan sold ad-targeting firm Tacoda to AOL in September for $275 million. Now he's planning on getting back into startups. He might even take investment from AOL, he told PaidContent, which characterizes the departure as "cordial." We're surprised in one sense — Morgan was telling people last fall how excited he was to take the job — but not in another. In an internal memo, AOL COO Ron Grant called Morgan an "entrepreneur at heart" and frankly, their kind isn't welcome long at AOL. Morgan's departure follows Kathleen Kayse's. Kayse, AOL's former EVP of digital media sales, left last week.
In an anticipated move, new Time Warner CEO Jeff Bewkes said the company will further separate AOL from its declining ISP business. Bewkes said the move would "increase AOL's strategic options," which the WSJ took as a hint that he would consider selling pieces of AOL. Speculation names Google an interested buyer. Common sense does not.
New Time Warner CEO Jeff Bewkes just held his first earnings call since taking over the top spot back in January. And to celebrate? Layoffs! Time Warner, the parent of AOL, Time Inc., HBO, and Warner Bros., among others, will cut 75 today from its corporate offices — about 20 percent of the headquarters staff. Still, 75 is plenty enough for chuckles. [AdAge]
AOL has acquired widgetmaker Goowy for an undisclosed amount. AOL claims it will roll out new widgets on its sites and integrate Goowy's technology into its advertising network. That's all very exciting, but when has AOL ever bought a company that changed the course of its business? Whatever That's for another post.
Before Friday, recently coronated Time Warner CEO Jeff Bewkes had planned to get Time Warner out of the Internet access business entirely, lowering its stake in Time Warner Cable and somehow disposing of AOL's dialup business. He could then, at his leisure, consider an ad partnership between Time Warner's AOL and Microsoft or Yahoo, the Wall Street Journal speculates. But Friday saw Microsoft offer $44.6 billion to buy Yahoo. An analyst at T. Rowe Price said that news leaves Bewkes with one place to turn: Google.
Does Microsoft's $44.6 billion Yahoo bid put AOL in play? Premarket trading sent Time Warner shares up 7 percent , indicating some investors think so. DealBook agrees, saying Google might target the Time Warner company for its advertising platform, "Internet service" and "Web site." Google already owns a 5 percent stake in AOL. And AOL is better at wining and dining advertisers the old-fashioned way; Google might buy the company just to bulk up its sales force. As for the rest of AOL? I don't know why Google bought even 5 percent of that.
