• by November 9, 2004

The Wall Street Journal and Washington Post reported today that AOL has reorganized into four business units resulting in three executive departures. The company's CEO, Jon Miller, says the changes were made as AOL accelerates its transformation into an advertising-supported broadband company. AOL wants to de-emphasize its dependence on dial-up subscription revenues and step up advertising growth.

Well, hurry up already.

We've only been hearing about the move to broadband and AOL's fabulous in-stream advertising plans and products for the last year or so. From what I can tell though, AOL still has to work hard to regain agency and advertiser trust. I continue to hear agency folks express frustration with AOL's process, even as they have faith in the direction of AOL Media Networks.

When I see some in-stream advertising programs that work, I'll believe there's something there. Until AOL can show me that it's stealing a few dollars from Yahoo!, MSN, and any other big publisher/portal with bold ad and content programs, I am reluctant to believe there is real change. Prove it.

AOL has been tearing down those subscription walls for months now. It wants to offer free content to greater numbers of people and the only way it can afford to do so is by selling advertising like crazy. So go to it. We hear the advertising market has picked up, particularly the online ad market...

Interestingly, while selected reporters were being briefed on the corporate reorg, an AOL representative tried to get me to write about the company's new TV ad campaign, reviewed yesterday in Slate, Advertising Age, the Journal, and elsewhere. Listen up AOL: The Minute and MediaDailyNews aren't interested in your sloppy seconds.

Time Warner's earnings announcement, coming as it did, the day after the election, was a stroke of genius, as practically every U.S. media outlet, even the business desks, were focused on post-election politics. The company never did confirm published reports about job cuts - some 700 jobs at AOL. The cuts were supposed to have been addressed during the earnings conference call. Oops.

Meanwhile, the AOL reorg results in three executive departures: Lisa Hook, the AOL Broadband chief; J. Michael Kelly, CEO of AOL International and Web services; and Joe Ripp, AOL vice chairman. The only one of the three with whom I was familiar, albeit by phone, was Hook, who impressed me as a smart and plainspoken strategic leader.

Ripp, the New York Times reports, will head back to Time Warner corporate where he was once the CFO. The newspaper says he will work for Don Logan, who heads Time Warner's media and communications group.

The AOL reorganization establishes four divisions: the content and advertising group led by Ted Leonsis, vice chairman of AOL; a unit for selling premium services led by John McKinley; an Internet access group which includes AOL's broadband business, run by Neil Smit; and a European business unit.

And now for something a little different... Amazon.com has gone the short Internet film route. Taking a page from BMW and others, the online retailer says it will offer one original short for download each week for the next five weeks.

The four-to-seven minute films use actors like Daryl Hannah and Chris Noth and don't mention Amazon! There are no logos and very little overt, smack-you-in-the-face product placement. Nice tack. Can't wait to view these ditties. Publicis Groupe's Fallon conceived Amazon Theater.