The ostensible reason was the formal announcement of the latest in a series of ventures undertaken by the Huffington Post Media Group, now a property of Armstrong’s AOL: 12 hours a day, five days a week of live video streaming. The press corps nibbled on lamb crostini with rosemary aioli while several staff Huffington had poached from the Times joined her in working the room.
The gathering was called to order. Armstrong spoke first. He recalled the first time he had met Huffington, in November of 2010, and how that led, many months later, to halftime at the 2011 Super Bowl, when AOL announced that it had agreed to pay $315 million in what was widely regarded as a desperate move to salvage its declining fortunes by buying Huffington Post and handing control of its editorial operation to Huffington herself. “We believe that content is king,” he said. “We also believe that brand is king.”
With that he yielded the floor to Arianna Huffington.
Huffington Post, she said, had evolved from “a fast-moving train to a supersonic jet.” One hundred and seventy journalists had been hired since the purchase—even as AOL laid off close to 2,500 people and shut down its own journalistic ventures, among them Politics Daily.* Even now, she continued, 20 reporters and six editors were at work on what promised to be a 75-part series on the hard times facing the middle class, a potentially dispiriting portrait that would mercifully be offset by HuffPost’s “Good News” vertical—“Man recovers wallet after 35 years!”
The video rolled. An actor playing a host brought a reporter from the On Celebrity vertical into a discussion about divorce, while ads rolled across the bottom of the screen and make-believe viewers were invited to join in the discussion via Skype. “We’re not creating a new brand,” said Roy Sekoff, now the project’s director. “We’re just doing what Huffington Post already does.”
To underscore the point, Huffington offered an example: Imagine a host interviewing Beyoncé. An editor from the newsroom breaks in with word of Defense Secretary Leon Panetta announcing a timetable for withdrawal of American troops from Afghanistan. Perhaps, Huffington suggested, the host might want to ask Beyoncé her thoughts about this news.
“Everything in our universe,” she said, “will be featured here.”
Tim Armstrong looked on and smiled and let Huffington do the talking, which made good sense, given that this was now her show. And lest there be any confusion, four large photographs hung in the hallway just outside of the studio: Arianna with Suze Orman and Arianna with Jamie Oliver and Arianna with a group of happy young people and Arianna with Mark Ruffalo and, then, Tim Armstrong.
Armstrong had come to AOL in 2009 after making his name overseeing sales and advertising at Google. He was 43, tall and handsome, the sort of man whom central casting might send over if the part screamed: successful. But at AOL he had inherited a company that, to put it bluntly—and many did—had no discernible reason to exist. AOL had once dominated the online landscape. But that was in the late 1990s, light years away in digital time. Its original core business, dial-up Internet service, was evaporating, even as it moved to transform itself into a content business. Armstrong seemed just the man to accomplish a turnaround; he was also a major investor in Patch, a network of local-news websites that AOL bought after his arrival.
Still, the decline of AOL provided a harsh lesson about corporate lifespans in the digital world. Nineteen years after its IPO and 11 after its $350 billion market-value merger with Time Warner, AOL was losing 19,000 customers a week.
So eager was AOL to boost its content-driven traffic that in late 2010 it devised a strategy, The AOL Way. Management set markers: Monthly story production rate was to rise from 33,000 to 55,000, video from 4 percent of the content to 70 percent. All staffers were to write between five and 10 stories a day. To help them make those numbers, AOL produced a 60-page handbook filled with graphs, content flow charts, and such exhortations as “Each article should be profitable and generate at least 7k PVs/story.” Editors were to “Identify High-Demand Topics”; guidelines were provided to “breaking, seasonal, and evergreen.” Editors were commanded to calculate a story’s “profitability consideration.” “Site leaders” were expected to have on hand no less than eight packages that could produce $1 million in revenue. One employee anonymously told Business Insider, which broke the story, “AOL is the most fucked-up, bullshit company on earth.”