AOL Buys Online News Hub Huffington Post
RENEE MONTAGNE, host:
The headline, this morning, on the home page of the Huffington Post, reads: A Brand New Media Universe. That outsized claim refers to the announcement, early this morning, that AOL is buying the Huffington Post for $315 million. The deal brings together an Internet company that's been struggling, with a news website that's been growing rapidly and creating buzz since its founding in 2005. The Huffington Post is among the 10 most visited, current events and global news sites. With the acquisition, cofounder Arianna Huffington will be in charge of all AOL content.
For more, we reached Kara Swisher in San Francisco. She's written two books about AOL.
Ms. KARA SWISHER (Author): Hi. How are you doing?
MONTAGNE: Fine, thank you.
Well, why is AOL doing this deal with Huffington Post, for this price, at this time?
Ms. SWISHER: Well, price is one issue. But they are doing it because they need to really turbo charge this effort by the CEO, Tim Armstrong, to focus on content and sort of become - they're calling it a new media company. Sort of a new media, and not in the old media way, but sort of a way to deliver content -and quality content, in a web fashion, and actually make money from it.
MONTAGNE: And what do we know about Arianna Huffington's new role with AOL?
Ms. SWISHER: She'll be the head of all the content on AOL. And they own a lot of content properties across a lot of topic areas. They've got finance sites. They've got politics sites. She's even running the MapQuest division of AOL.
MONTAGNE: And one thing about content - the Huffington Post is very much identified as a liberal outpost. Is this how AOL wants to be identified?
Ms. SWISHER: Well, it's going to be brought up, because Arianna's such a, you know, she's sort of a lightning rod in so many, for both good and bad, depending on what side you're on. But she's actually been leaning against - if you've noticed lately, she's sort of been on the attack against the Obama administration of late. You never know quite where she's going to go.
So, even though it started out as sort of a counter to the Drudge Report, which was the right leaning website. I think it sort of evolved into a more central kind of thing, where there's a lot of debate going.
And she's certainly sort of in the Democratic camp. But at the same time, they've really evolved and broadened their topic areas beyond politics too.
MONTAGNE: Well, Ms. Swisher, what do you think it says about the future of online news? And there you get into - maybe you could, you know, answer if this is a good deal for AOL for what it's offering to pay.
Ms. SWISHER: Well, you know, Huffington Post has been growing its revenue. So, you know, if they get to where they say they were going to get this next year, it would be about five times the revenue, and it's ten times the revenue from last year.
It's a good deal, in that it gives them sort of - puts this sort of, you know, the Huffington Post is very good at creating a very exciting aggregation play in news. And they also have started to do original journalism on the site. They were dinged a lot for not doing enough of that. And so it gives, you know, it's really very good at aggregating a fun and exciting read on the Internet.
The question is how are people reading now? Are young people reading more socially? Do they read at websites? Do they go to destinations? What it does say is that news is an exciting area and it always will be. It just depends on how it's going to be distributed.
MONTAGNE: Kara, thanks very much.
Ms. SWISHER: No problem.
MONTAGNE: Kara Swisher is co-executive editor of All Things Digital, a tech and media blog owned by Dow Jones. And in a letter to readers, Arianna Huffington describes the deal with AOL as quote, "like stepping off a fast-moving train, and on to a supersonic jet.
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