AOL and the Huffington Post

February/08/2011 16:13PM
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Once upon a time AOL owned the Internet server business. Just as Blockbuster owned the movie rental business. But, times change and some companies change with them and others don’t. Blockbuster watched Net flicks and Red box take over their business. On demand finished them off. They tried to react, but were always slow.

AOL watched the competition offer free server options. As their customers left they cut prices but held on to customers who didn’t mind paying $10 a month to keep their original Internet address. But, wouldn’t pay more. That’s their customer base now. 

AOL has had a long parade of questionable leaders. The current honcho, Tim Armstrong, may be ultimately judged the worst of a bad lot.  He announced AOL is paying $315 million to buy the Huffington Post. The Huffington Post is a far-left political publication.  Very far left. Evidently, Mr. Armstrong has reason to believe the base AOL retained, after all the other servers syphoned off their customers, is a far left group. Well, he’s wrong in my case and he can kiss off my $10 a month. The AARP found it’s risky to double cross the seniors by pimping ObamaCare. They lost millions of members for that. 

Mr. Armstrong may replace the AOL subscribers he loses, like me, with far-left Huffington supporters. My guess is he won’t. Liberals are cheap. They like to spend other people’s money, but none of their own. If that’s the case, AOL, loses cash flow and pays interest on the debt  to buy Huffington and it will be interesting to see what, if any, revenue increase Huffington brings to AOL.

It seems the media market is glutted with left-wing options, thus, the success of Fox. Why try to add another bigger player?

Good luck, Mr. Armstrong. I think you just bet on a lame horse.

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