AOL, Yahoo aim for revival

18 July 2012

NEW YORK: AOL and Yahoo, two early internet pioneers, are both adopting new strategies in a bid to reverse a long-term decline in their fortunes.

AOL, which has faced several challenges after an ill-fated $100bn merger attempt with Time Warner in 2001, is seeking to revive its standing by promoting its full product range, not just the parent brand.

"We're going from resuscitating the core brand to being a stable of brands," Tim Armstrong, AOL's CEO, told the Financial Times. "If you added up all our brands and compare them to M&A activity in the [web] services marketplace, our brands would be worth a lot of money for investors."

AOL's main assets include the Huffington Post, the news portal, TechCrunch, a technology title, Moviefone, the film site, and, the gaming platform.

Jolie Hunt, formerly global head of brand and public relations at Thomson Reuters, the information group, has also become AOL's chief marketing and communications officer, the first since Armstrong took over in 2009.

The firm's portfolio contained 340 brands at that point, but it is now prioritising between ten and 20. The ultimate goal, Armstrong added, will be to use a similar model to Walt Disney when managing ABC and ESPN, its TV stations.

"AOL is a top five internet brand with a valuation that doesn't reflect that. There can be a pretty substantial value increase for the company by just leveraging the brand potential," he said.

Figures from comScore, the research provider, showed traffic to AOL's sites fell by 4% in May on an annual basis, to 110m unique visitors.

Yahoo, the online portal and search engine, has also appointed its third chief executive in a year, in the form of Marissa Mayer, a long-serving Google executive.

When at Google, Mayer had spells in charge of search products, and then mapping and local services, which assumed greater importance as the Android mobile operating system gained ground.

"This is a very competitive and a tough space. I don't think that success is by any means guaranteed," she said. "Yahoo's products will continue to enhance our partnerships with advertisers, technology and media companies, while inspiring and delighting our users."

Yahoo reported that it has 700m users around the world. In its home market of the US, the company's ad revenues are forecast to decline by 7.4% this year, according to eMarketer, to less than half the level logged in 2009.

Data sourced from Financial Times/Reuters; additional content by Warc staff