Borrowing a line from President Obama, Arianna Huffington announced what she called a "Sputnik moment" for her self-named online publication Sunday night: AOL will purchase the Huffington Post in a $315 million deal that will reverberate through both companies and the larger online news industry.
"By combining HuffPost with AOL's network of sites, thriving video initiative, local focus, and international reach, we know we'll be creating a company that can have an enormous impact, reaching a global audience on every imaginable platform," Huffington told readers
Sunday night on her website.
A frequent presence on cable talk shows, the liberal author and blogger will take control of AOL's editorial content as head of a newly created Huffington Post Media Group.
According to an announcement
on the AOL corporate website, the two companies "will have a combined base of 117 million unique visitors a month in the United States and 270 million around the world."
AOL Chairman and CEO Tim Armstrong called Huffington "a singularly passionate and dedicated champion of innovative journalistic engagement, and a master of the art of using new media to illuminate, entertain and enhance the national conversation. Arianna is a remarkable person and she will continue to create remarkable outcomes for the combined company."
Huffington, 60, co-founded the Huffington Post with Kenneth Lerer -- a former AOL Time Warner executive -- in 2005. The site functions largely as a blog and news aggregator, but has nearly 100 paid staffers complemented by thousands of unpaid writers. The size of its readership has rocketed to 24 million visitors each month -- just two years ago, it attacted 4.5 million.
Launched in 1985 to provide dial-up Internet access to subscribers, AOL merged with Time-Warner in 2001, a marriage that fared poorly and led to a divorce in 2009. In recent years AOL has rebranded itself as a content provider, with such sites as Politics Daily, Fanhouse and many others. More recently it extended its reach through Patch.com, which provides local news and commentary in 775 towns across the U.S.
But AOL has had a tough time thus far reversing its financial standing. During the fourth quarter, revenue fell 26 percent to $596 million and advertising sales dipped 29 percent to $332 million.
Armstrong told the New York Times that the acquisition "is a statement that the company is making investments, and in this case a bold investment, that fits right into our strategy. I think this is going to be a situation where 1 plus 1 equals 11."
, Arianna Huffington
, huffington post
, tim armstrong