Gawker: valleywag, advertising.com

AOL ad business grows 1 percent in a year

Nicholas Carlson — Wed, 30 Apr 2008 11:20:00 EDT

Whispers on Wall Street predicted Time Warner would today report AOL ad revenues down 30 percent since last year, SAI reports. Didn't happen, but hold the cartwheels. AOL only grew 1 percent since the same quarter last year. Paid search and AOL's ad networks, which place ad on third-party sites, drove the growth, while declining revenue on display ads on AOL properties kept it meager. That's an unprofitable equation. Popular publishers demand high guarantees before joining ad networks. This quarter, such "traffic aquisition costs" were a primary reason for underwhelming numbers.

AOL dealmaker now has to make deals work

Owen Thomas — Fri, 18 Jan 2008 17:20:09 EST

So rarely do the executives who strike deals have to execute them. The hard work of fitting acquired companies together is usually left to less-glamorous grunts. How satisfying, then, to see Jon Werther, recently in charge of business development at AOL, made responsible for "integrated operations". Werther will have his hands full shaping AOL's numerous online-advertising acquisitions into the new Platform A business. Specifically, we hear that the folks at Advertising.com, AOL's third-party Web-ads network, loathe the newcomers from Tacoda. Good luck with that, Jon.

Erick Schonfeld follows up on Jason Calacanis's...

Owen Thomas — Thu, 27 Sep 2007 11:54:25 EDT

Erick Schonfeld follows up on Jason Calacanis's rumor via Twitter: AOL is considering a spinoff of Platform A, its new combination of its Advertising.com business and its conventional ad sales force. Why just the ad business? Online ad networks are hot, while no investors want AOL's dial-up or portal business. [TechCrunch]

The fall of AOL's Mike Kelly

Owen Thomas — Mon, 17 Sep 2007 12:37:08 EDT

Search and ye shall find — steady employment in advertising, that is. That's the lesson I'm taking from Mike Kelly's abrupt ouster, announced today, as head of AOL's ad sales. How abrupt? Mediaweek just named him one of the 50 most influential people in advertising. If you haven't heard of Kelly, here's his resumé at a glance: A Time Inc. ad sales guy who rose to become publisher of Entertainment Weekly, Kelly was sent down by Time Warner to fix AOL's relationships with advertisers. He largely succeeded in that, and also spearheaded the acquisition of Advertising.com, an online ad network that places ads on third-party sites. Advertising.com has provided much of AOL's recent growth in ad revenues. But elsewhere, AOL's ad sales have stalled. Especially in search. And Kelly, fairly or unfairly, is getting the blame.

Like Yahoo's ousted ad-sales chieftains, Gregory Coleman and Wenda Harris Millard, Kelly grew up in the world of print publishing. And banner ads, although smaller than full-page print ads, were comfortably close: Sold in large packages at a CPM rate to brand-minded advertisers.

That's not, of course, the world we live in today. Some advertisers still pay by the thousands of impressions, but others insist on paying only when users click through, or when an ad actually leads to a sale. The latter forms of ads, of course, dominate search, which is the largest category of Internet advertising today.

To sell search ads, however, you need a search engine. And though Kelly had been running AOL's search business, he hadn't been doing a great job of it. Former AOL executive John McKinley excoriated the company for slavishly imitating Google in its search-results design. And even copying Google, which already provided AOL's raw search results, hasn't stemmed AOL's steady loss in search market share.

Stepping into Kelly's place is Curt Viebranz, the CEO of Tacoda, an ad-targeting company recently acquired by AOL. Viebranz, like Kelly, did stints at Time Inc. and Time Warner, but he has a longer tech and new media resume. He'll be running a group at AOL called Platform A, which rolls together Advertising.com, Tacoda, and other ad-sales organizations. Perhaps MediaWeek can issue a rush update and slot Viebranz in Kelly's place.