Monday, February 7, 2011

Morning Brief: The Huffington Post sells out to AOL; Super Bowl ad winner didn't spend a dime last night

I find this to be a head scratcher: AOL has bought Huffington Post for $315 million, almost all of it in cash.

For Arianna Huffington, this is the pay off for her meager investment in new media back in 2005. AOL, this is another example of the company trying to buy its way to revenue growth and a future.
With the completion of the deal Huffington will become president and editor-in- chief of the Huffington Post Media Group, which includes Huffington Post and AOL news content, as well as MapQuest and Moviefone. Huffington, in essence, becomes the face of AOL.

The reaction to the deal was interesting in and of itself:

The Telegraph: Is The Huffington Post really worth $315 million? (Yes, probably it is.)

The Guardian: Who gets the $315m? (Yep, Huffington is rewarding her friends, inline with the way she does business.)

WSJ: Is it crazy? (The author says that "we’re getting a little worried about Armstrong" and then "The Huffington Post deal also is essentially Armstrong’s mea culpa that his own content-first strategy wasn’t working." Frankly, I've not had the same confidence in AOL's news strategies up to this point. For all the huff and puff coming from AOL about its Patch expansion I've yet to see anyone at Patch really talk a serious game about revenue. The build-it-and-they-will-come strategy seems way too naive for me. If they went out and sold some damn ads I might be impressed.

Daring Fireball: "They deserve each other." (Guess John Gruber is not a fan.)

Everyone has their opinion, I suppose, about the best and worst of the Super Bowl ads. I, frankly, was underwhelmed by the imagination of the ad community this year. This ad for Doritos seemed to get some of the most favorably feedback:

But one of the big winners last night had to be a company that didn't spend any money at all: Apple. I counted at least five ads that prominently promoted either the iPhone or iPad. The companies were Comcast's ad for its Xfinity iPad app (that had to be a first, a Super Bowl ad for an app), AT&T and Verizon's ads for promoting either faster data or better connections for the iPhone. (All these ads, I believe, were local buys, or buys into the pre-game shows.)

In the past, Apple was known for a company that didn't do much broadcast advertising. The growth of the iPod, then the iPhone, changed all that -- along with a growing bank account. Now the company can be seen everywhere promoting especially the iPhone and iPad. But Apple probably didn't think it would be necessary to spend upwards of $3 million for 30 seconds when they had the telecoms doing their promotion for them.