Strategic challenges
On February 7, 2011, AOL Inc. agreed to buy the Huffington Post for $315 million (Sweeney,
2011). AOL’s acquisition of the Huffington Post is part of its strategy to increase its
investments in online content and to help revive growth in advertising revenue to compensate
its declining dial-up internet revenues (Sweeney, 2011). It is meant to strengthen AOL’s local
news initiative, Patch, and its citizen journalist venture, Seed. AOL’s own news Web sites
like Politics Daily and Daily Finance will probably disappear and many of its writers will
continue to write for the Huffington Post. The transaction will create a premier global,
national, local, and hyper-local content group for the digital age – leveraged across online,
mobile, tablet, and video platforms. Thus the take-over by AOL means a substantial
investment of resources in the Huffington Post’s local news activities. For AOL the challenge
will of course remain in building and maintaining a viable business model based on
advertising.
Many have criticized the quality of the Huffington Post’s content because a lot of the news is
aggregated from other news sources. Also the content on AOL’s news sites has often been
considered below standards. The Huffington Post has started to invest more in original
reporting and writing, hiring experienced journalists from The New York Times, Newsweek
and other traditional media outlets. Finding the right balance between a successful online
news and bloggers site of sufficient quality and original content on the one hand and running
a profitable online news business will be one of the Huffington Posts main future challenges.
Statistical, Ecosystems and Competitiveness Analysis of the Media and Content Industries
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D Company Database
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