CEO Armstrong: No social network in AOL's future
Tim Armstrong says AOL will continue to invest in content, and he sees the possibility for a comeback of the portal concept.
In case you were wondering what AOL is turning into, one item that's not on the agenda is a social network.
"We're not as laser-focused on social as you might think we should be at this point," said Tim Armstrong, speaking at the TechCrunch Disrupt forum this afternoon. He added that "if there's one core strategy, it's turning advertising into content...we want all brands to be publishers and that feeds into how brands publish social." The talk was also shown via Webcast.
Despite the recent excitement created by the enormous size of Facebook's initial public offering, Armstrong gave no indication that he might want a piece of that action. Instead, he seems content to continue cobbling together various content brands living under the common AOL banner.
At the conference -- organized coincidentally by the AOL-owned TechCrunch -- Armstrong also brushed away any suggestion that there was pressing need to make sharp deviations in his strategy. "It's doing well overall," he said, referring the the company's advertising sales. "Overall, the business is doing well and I think investors will see that in the stock price."
Currently trading above $27, shares of AOL have nearly doubled in value since November and are well above their 52-week low of $10.06.
He wasn't pressed about much more and only made a passing comment about Starboard Value LP, a dissident investor that does not share the CEO's optimism about AOL's current direction. It was only happenstance but Armstrong made his cameo on the same day that Patch.com, AOL's online local-news network, notified its nearly 1,000 person staff of plans to carry out a coming restructuring. (Meanwhile, Patch is already reported to have laid off 20 people.)
"After implementing a more efficient field structure earlier this year, we have seen an impressive boost in both traffic and revenue," said Jon Brod, chief executive of Patch. "With an eye on our overarching business goals, streamlining our field management structure not only gives us additional operating leverage, but also allows us to better serve our users and our communities. This is the next step in Patch's strategy to win."
Patch is costing AOL about $100 million a year and has become a main talking point for Starboard Value LP to force changes at the top. Armstrong is already on record promising Patch will be in the black by next year. In the meantime, he reaffirmed the "content is king" mantra during the Disrupt talk.
"Content is going to be a thing that differentiates the platform," Armstrong said, adding that he thought "the old notion of a portal will come back into vogue again." Armstrong didn't get more specific but alluded to what he said was a need for "strongly curated information on a daily basis."