The blog post I was planning to write for today will have to wait until tomorrow so I can think out loud about AOL’s purchase of the Huffington Post. First an admission: I used to check the Huffington Post a couple of times a day as a kind of guilty pleasure. They just make it so damn easy to see both the key political headline of the day and then immediately afterward some completely gratuitous piece of entertainment news. I am saying “used to” because I am not sure how long that will last in the new constellation.
This is clearly a good deal for Arianna Huffington who I am pretty sure owns a meaningful piece of the Huffington Post and it will further accelerate the HuffPo’s reach and put her in charge of an even broader portfolio of content. It is also likely to be a very good deal for the early investors, in particular Ken Lerer who I believe did the seed round, but also for Greycroft and Softbank. Maybe less so for OAK which invested $25 million at the end of 2008 (although a very nice IRR for sure). This got done as an all cash deal so nobody has to bet on AOL stock.
While I am happy for the many NY-based investors and co-founders, I am a bit sad to see this happen now. I believe that the Huffington Post could have had a longer run as an independent company, with a potential of becoming the center of a new journalism universe. While their aggregation-based model was upsetting to some, the Huffington Post did invest a fair bit in technology and created an interesting web based news experience that easily beat the pants off such endeavors as “The Daily” (apps break the web!). With some more growth and some experimenting on the formula, the Huffington Post could have become a critical source of traffic and revenues for independents.
Instead, I am afraid that as part of AOL, the Huffington Post will become completely ensnared in the content farm approach to the web where fewer and fewer links go to the outside world. After all, this is the company that wants to produce 50,000+ pieces of content every month with its own writers. And the only way they could figure out how to work with someone like Techcrunch was to buy them. So: time to look for another champion that will make the independent model work. Come to think of it: Reddit has been on fire recently growing to 1 billion page views/month.