It’s an advertising play.
What’s wrong with the Internet and with HuffPo and with AOL is that Internet content CPMs suck. HuffPo, as a senior-most media buyer told me over lunch last week, will sell anything and do anything for an ad buy—becoming the true generic mix-up of the sponsored and the true—and still it couldn’t muster a CPM that was worth much. That would be true of AOL, too. What the business demands, then, is ever-more traffic—and this is where the combination is arguably “one and one makes three” (we conjure an extra page view from your traffic, you conjure one from ours)—ever more miserly economies of scale, and a whole new level of clout.
That last point is the play: clout.
The proposition is that AOL is on the way to controlling so much traffic and so much content real estate that it can start to have more meaningful, more creative, more—spread your arms, and gesticulate widely—wide-ranging conversations with marketers and media buyers. The combination of so many opportunities and so much one-stop ease and so much smart and efficient packaging can result in significant margin improvement