A new 'Glow' for AOL's blogs? Good luck
Meet MediaGlow, the third "core business" for AOL and a much-needed overarching unit for its many blogs and content brands. But given the ad climate, is it too late?
By now you've probably heard about it: AOL has formed yet another business unit conspicuously devoid of "AOL" branding, and this one's about the blogs.
Called MediaGlow, the just-announced division encompasses AOL's digital content assets from gossip hub TMZ to tech heavyweight Engadget. It's the first time that AOL has formally pulled together the titles it acquired with blog network Weblogs Inc. in 2005, blogs launched since the Weblogs acquisition, and the vestiges of the old AOL portal like AOL News and AOL Sports.
It's about time, though I expect there will be plenty of "lipstick on a pig" comments. But the real news is the expansion that AOL plans for MediaGlow, under the leadership of programming chief Bill Wilson: in 2009, it plans to launch about 30 new editorial sites (read: blogs). AOL also plans to open "MediaGlow Studios" in both New York and Los Angeles that will focus on video production, as well as work acquisitions Relegence and Sphere into "an unprecedented effort to build thousands of medium and long-tail focused automated sites." We'll have to hit up AOL soon to find out exactly what that means.
The new MediaGlow unit complements AOL's two other "core businesses": social-networking division People Networks, which was put together after AOL's $850 million acquisition of Bebo last year; and Platform-A, its conglomeration of advertising products both built in-house and acquired.
It's no secret that parent company Time Warner has been preening at least part of the company for a sale, with CEO Jeffrey Bewkes making it clear that its flagging dial-up access business is on the blocks. Executives haven't confirmed widespread rumors that the rest of AOL could be up for sale as well, but this sort of neat packaging into "core businesses" could be an indicator in either direction.
If you look on the sunny side, the timing is opportune: Print publishing is gasping for breath, and due to repeated old-media missteps there still isn't yet a digital publishing power on a truly big-media level. Blog networks like Gawker Media have stayed small- to medium-sized and have certainly not been exempt from recessionary woes. IAC/InterActiveCorp, which owns properties like The Daily Beast and CollegeHumor, hasn't pulled them together in the same way. (Disclosure: CBS Interactive, which publishes CNET News, is unquestionably a player in this game as well.)
On the traffic front, AOL has reason to push forward with MediaGlow. The company says that page views are up 40 percent year-over-year and that "vertical content advertising revenue" was up 20 percent year-over-year in the third quarter of 2008. Ad revenue as a whole, unfortunately, has slid in sync with the media recession. And with so many pundits talking about the impending burst of the blogging bubble, it's worth questioning whether launching 30 new titles will be intrepid or just foolish.
So here's my verdict: This is something that AOL needs to do, and probably should've done much sooner after its Weblogs Inc. acquisition. Unfortunately, given the way things are these days, even a valiant effort at expansion can flop.
P.S.: AOL, you might want to look into buying the domain Mediaglow.com. Registered in Wellington, New Zealand, the site appears to be a placeholder. Go get it!