Levick: AOL Moving Toward Niche Content, 'Change'
While its reorganization and resulting cost structure remain uncertain, AOL brass has settled on a five-point strategy for the soon-to-be-independent company. As outlined internally and to members of the press, it includes the continued expansion of vertical content, local and online mapping services, its third-party ad network, communication tools, and early-stage investment through a newly formed AOL Ventures arm.
"First, you have to figure out strategy," said Jeff Levick, recently appointed president of AOL Advertising. "After that, you focus on structure and cost."
After nearly a decade of dysfunction, Time Warner recently confirmed plans to spin off AOL as a separate and publicly traded company by the end of the year.
The new AOL will exist less as a Web portal, and more as a fragmented network of niche content sites. This MediaGlow network, so-called, presently encompasses over 70 niche content sites -- with many more on the way, according to Levick.
"We see it as the new model for digital publishing," Levick said. "There's going to be a lot of development in this area, which is where AOL Ventures comes on."
In June, the MediaGlow network accounted for 75.4 million unique visitors, which represented a 5% increase year-over-year.
Levick -- hired in mid-April by AOL's recently named CEO, and former Google colleague, Tim Armstrong -- arguably has the most daunting challenge in fixing the company's ad sales issues.
"We're looking at how our sales teams are organized, and deployed around groups of content," he said. "We're reorganizing around customers and display-based advertising."
Albeit in a dour ad climate, AOL continues to struggle. Ad sales dropped 20% in the first quarter of this year -- or $109 million -- surpassing the 18% decline in the fourth quarter.
In mid May, AOL fired a reported 50 sales and marketing staffers, including many from its Platform-A ad unit.
Without explicitly confirming additional layoffs, Levick said: "Like any business that goes through massive change, there might be changes."