While IAC's ad sales division currently sells online inventory on IAC properties like dating site Match.com, ticketing site Ticketmaster.com, and online travel agency Expedia.com, this deal marks the first time that IAC will sell inventory for a company that is not controlled by Diller. (IAC recently spun off Expedia.com, but Diller continues to head the company.)
Although the Huffington Post has independently forged deals with companies such as Continental Airlines, AOL, and ad agency JWT (formerly J. Walter Thompson), the 1-year-old blogging site viewed outsourcing as the fastest route to building ad revenue. "It's a way for us to immediately scale this year, so we can have instant momentum for the second half of 2006," said Sarah Bernard, Huffington Post general manager.
Diller and Huffington, both entrenched Hollywood figures, have mulled prospects for working together for a while, Bernard said. Last month, The New York Times reported that Diller--a former CEO and chairman at both Fox, Inc. and Paramount Pictures Corporation--had approached Huffington about building a satiric property. Such an initiative remains a possibility, Bernard said. Huffington has previously called on her Hollywood connections to develop the blog. Contributors have included screenwriter Nora Ephron, "Seinfeld" co-creator Larry David, and actor John Cusack, among others.
The Huffington Post also features highly opinionated political bloggers known for stirring controversy--a trait that could pose problematic in attracting ad dollars. IAC's Mort Greenberg--vice president of sales strategy and development for IAC Advertising Solutions--downplayed the challenge, saying that IAC's ad team is used to selling against non-ad-friendly content. For instance, he said, consumers often post unfavorable reviews of restaurants or other establishments on Citysearch.com, IAC's guide to cities. "You can't always control what's on the pages, but we can't control what's on our pages either," Greenberg said.
The deal will officially roll out on July 1, although deals with existing advertisers and sponsors--including AOL, which is sponsoring a film festival on the site--will remain in place through the term of their contracts.