AOL restructures again highlighting members, brands and ads

June 29, 2012

Six months after reorganizing, AOL has done it again. This time, the Internet, advertising and content company will split into three parts: AOL Membership, Brand Group and the Advertising.com Group.

“Brands are at the center of our company and we are structuring our talent and organization around our brands,” chief executive Tim Armstrong said today.

Armstrong’s move is seen as a balancing act between his work to build a long-term revenue strategy for AOL and shareholders seeking short-term gains. The announcement follows Thursday’s $400 million share buy-back by AOL and a shareholder vote earlier this month retaining Armstrong’s current board of directors.

As part of the restructure, AOL’s premiere brands, such as the Huffington Post and Tech Crunch, will gain more autonomy, lessening the risk that visitors will jump ship amid heavy-handed corporate branding. In April, HuffPo founder Arianna Huffington took back some control from the site’s corporate owners, providing what she told the New York Times was “the innovative spirit of a start-up.”

In 2011, Tech Crunch founder Michael Arrington had a long-running feud with AOL after Arrington decided to open a venture capital firm and continue writing for the blog which comments on tech start-ups. Arrington eventually left Tech Crunch.

AOL also announced Friday its latest restructuring will include the Membership Group. The group will oversee paid and free members of the company’s properties, including AOL.com, AOL Mail and elsewhere.

The third arm of the new AOL will be the Advertising.com Group to manage the company’s advertising hopes. Advertising has been one of the firm’s areas of strongest revenue growth, AOL claims.  However, the company must deal with two 800-pound gorilla — Google and Facebook — making this unit one to watch, AOL-owned Tech Crunch comments.

Finally, to oversee all through groups, Armstrong appointed the company’s chief financial officer, Art Minson, to the role of chief operating officer.

In December 2011, AOL announced it would restructure into divisions for dial-up/online, local business, media and advertising. Today’s announcement did not mention Patch, AOL’s chief local media business which has come under attack for its lack of success.

“We have a valuable portfolio of world-class content brands, and we want each of these brands to have distinct plans for innovation and profitable growth,” AOL explained.

Photo via Shutterstock

Copyright 2012, VentureBeat

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