News Article
Richard Adams: Huffington Post founder Ariana Huffington sells her site to AOL for $315m and becomes editor in chief of AOL's output
07/02/2011
The Huffington Post, the ground-breaking online news and opinion site founded by Ariana Huffington on a shoestring, is to be bought for $315m by AOL, in a move bound to stun new media sceptics and believers alike.
With the sale of the website which only began life in 2005 reported to be for $300m in cash and $15m in shares, the purchase will send shock waves through the US media as established news organisations struggle to get to grips with the unchartered territory of online news.
The sale to AOL marks a personal triumph for Ariana Huffington, the colourful and controversial co-founder of the site that bore her name, who under the reported terms of the deal is given a new role as president and editor in chief of a unit to be named Huffington Post Media Group, and includes management of AOL's sprawling news operations and other media enterprises such as TechCrunch and MapQuest.
"This is the most exciting thing I have ever done," Huffington said yesterday after the deal was first announced.
It also represents a huge gamble by AOL, once the commanding presence as the US's dominant internet service provider, and the subject of a disastrous merger with Time-Warner in 2000 that was eventually unwound in 2009.
The New York Times reported the deal:
The deal has the potential to create an enterprise that could reach more than 100 million visitors in the United States each month. For The Huffington Post, which began as a liberal blog with a small staff but now draws some 25 million visitors every month, the sale represents an opportunity to reach new audiences. For AOL, which has been looking for ways to bring in new revenue as its dial-up Internet access business declines, the millions of Huffington Post readers represent millions in potential advertising dollars.
"This is a statement that the company is making investments, and in this case a bold investment, that fits right into our strategy," Mr Armstrong said in an interview Sunday. "I think this is going to be a situation where 1 plus 1 equals 11."
Huffington and Armstrong began discussing the possibility of a sale only last month. They came to know each other well after they both attended a media conference in November and quickly discovered, as Huffington put it, "we were practically finishing each other's sentences." She added: "It was really amazing how aligned our visions were."
Huffington and AOL's chief executive Tim Armstrong announced the deal at the Super Bowl in a video on the Wall Street Journal's Kara Swisher. In it Huffington says: "Tim came out to LA in January, and we had lunch, and that's when we came up with the 1+1=11 concept."
"Ariana and her team fit a very specific need for us," Armstrong said.
Originally a politics blog aimed at Democrats, the Huffington Post branched out into celebrity coverage and turned itself into one of the biggest pieces of real estate in online news media in the US, rapidly overtaking more established media organisations such as the Washington Post by deftly utilising the internet to exploit untapped markets.
guardian.co.uk © Guardian News and Media 2011
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