Skip to comments.PATCH.COM: The Huffington Post Sale’s Secret “Diamond in the Rough”
Posted on 02/07/2011 8:14:58 PM PST by TheHawksNest
Last night, while most of us were feasting on chips, seven-layer dip and the latest Super Bowl commercials, Arianna Huffington was announcing that progressive news site Huffington Post was purchased by AOL for $315 million dollars.
Reach however is only part of the story. The deal allows Huffington to distribute the Posts progressive content without the progressive label. When people read news content from the Huffington Post they know what they are getting: news and opinion from the progressive point of view. Now that same news and opinion can be recycled and distributed across the internet under the politically neutral name of AOL.
AOLs reach into the news world goes much further than the sign-up screen, Politics Daily, etc. I contend that the most significant news property that will be controlled by the Huffington Posts progressive machine is the least known, Patch.com.
Patch is a network of 500+ hyperlocal websites covering 800 communities which combines national/regional information with local community news editors filing stories and updating community-specific within the communities they serve. As of today the Patch network is concentrated mostly in the larger states.
(Excerpt) Read more at newsrealblog.com ...
AOLs Patch.com covers 800 towns across America, providing an incredible infrastructure for citizen journalism in time for the 2012 election ...
Arianna and her people have done well for themselves by investing $1,000,000 five years ago and today pulled out $315,000 without giving-up editorial control.
Time will tell.
But businesses, even ones that have been poorly run like AOL, should look at how to make the most money, not just advance an ideology. Yes there are example where the owners (like GE) set profit aside in order to have a mouthpiece but I think we’ll start to see a moderation of that under Comcast. So it will be interesting to see if AOL does in fact use the HuffPo model as one that could serve a wide range of political views, or if it will pursue an ideology-driven appoach that will cut them off from well over 50% of their potential revenue sources.
No one likes AOL.
It was a CASH deal. Arianna’s dream come true-now she can go & get some plastic surgery, don’t ya’ think?
but she’s in Obama’s pocket,too................. :D :D D:
AOL is no diff
I once raised hell at a Post Office.
They had AOL IPS “introductory” CD’s, “free” on the counter tops of a FEDERAL ENTITY for those with computers.
I asked what OTHER ISP companies they “promoted”.
But, you should have seen the expressions on the faces of the “federal employees” that were asked the question....dazed and confused.
(”dazed and confused” make the BEST employees for the government, don’t they?)
AOL has money to burn apparently.
Sacrifice for the cause of leftism.
I remember the same thing and asking WTH they were doing. I also remember tossing tons of them (every time I went to my PO box) until they just stopped putting them out.
Politically neutral name of AOL?
Why were free AOL disks being distributed in the US Post offices, offering several months of free service about 2 years ago? They were available for at least a year and no one at the PO had a clue as to why they were there, or who kept restocking them, yet there they were
AOL is also next to impossible to remove from your system once installed.
I believe AOL tracks and records your internet activity. If you use AOL, I advise you dump it, unless youre not concerned about your privacy . (Foil hat off now,,,, and good luck with removing it!)
People still use AOL?
citizen => yellow
I wonder if AOL realizes it has obtained a tiger by the tail, though. A tiger which will claw it to death.
According to this story
AOL to buy The Huffington Post for $315 million
WASHINGTON/NEW YORK (Reuters) AOL Inc will buy Arianna Huffington’s influential website for $315 million, looking to the high-profile liberal pundit to rescue it from the dustbin of Internet history.
The move, announced Monday, comes at a hefty premium. AOL is estimated to be paying 32 times earnings before interest, taxes, depreciation and amortization for The Huffington Post, said Benchmark Co analyst Clayton Moran.
Similar content deals, such as Hellman & Friedman’s acquisition of Internet Brands in September 2010, typically go for eight to 12 times earnings, said Moran.
“AOL just spent 40 percent of their cash for very little near-term return,” said Moran.
AOL expects Huffington Post to generate around $10 million in profit before interest and taxes and see savings of around $20 million meaning it would be valued at around 10 times 2011 profits.
The Internet company’s name is still a proxy for expensive mergers gone wrong following the unraveling of its $350 billion merger with Time Warner Inc in 2000. Once worth $163 billion, today AOL has a market capitalization of around $2.3 billion. Shares fell 3.4 percent to close at $21.19 on Monday.
AOL’s management was eager to point out that there would be financial benefits from buying Huffington Post.
“One plus one will equal 11,” AOL Chief Executive Tim Armstrong said in an interview with The New York Times.
They’re asking for big trouble. There aren’t that many more liberals to mine, and conservatives along with most moderates will treat them as radioactive.
Must be that New Math.
Recall that one of the conditions the FCC attached to the Comcast acquisition of NBC concerns the relationship between the ten O&O stations...and local "non-profit newsgathering operations".
The O&O's are required to partner with a local non-profit in each market -- using them to supplement there on air and internet reporting and allowing them production and editing privileges.
It so happens that there is already in place a network of "non-profit newsgathering operations" -- INN, or Investigative News Network.
Guess who funds the non-profit INN?
The Open Society Institute -- George Soros' front organization.
This kind of progressive influence on the major network will make the MSNBC operation look like a pimple on the progressive butt.
Some Congressional hearings into how the FCC cleared the Comcast deal...and why they felt it necessary to stipulate partnerships with "non-profit newsgathering operations" bears questioning.
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