AOL’s Armstrong, ‘Content King,’ wears heavy crown

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Tim Armstrong at the TechCrunch Disrupt event this spring. (Via TechCrunch Disrupt)
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Meghan Keane

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AOL turned 25 this Spring. To celebrate, the internet giant has been throwing a series of diverse events. In New York at the end of May, AOL's pop culture blog Urlesque threw a party on the Lower East Side at local bar Sweet and Vicious. It had all the trappings of a party thrown by a small blog—a smart, attractive crowd and a cash bar. Silicon Alley Insider called it "a party Gawker Media would throw."

One block away, the larger corporate entity was throwing a much swankier affair at the New Museum to launch the company's new partnership with artist Chuck Close. Urlesque writers weren't invited to that one. And up the street from there, John Legend was playing to a packed room at The Bowery Hotel. Drawing a line between all the different events is not easy. But that's the point. The company's new C.E.O. Tim Armstrong has set himself the task of making a large corporation run like a small group of startups. With over 100 web properties working under the AOL brand, sometimes it's hard to see where it all fits together.

AOL has spent the last quarter century populating American pop culture with cute dial-up noises, Nora Ephron-movie-inspiring catchphrases (You've Got Mail!), and a merger with Time Warner that went on to symbolize everything the 2000s dotcom bubble got wrong. Rather than update its slowly dying subscription business, the company is trying to wean itself from that revenue stream, focusing instead on a content strategy for the web. At AOL, they don't refer to this as a turnaround. They call it a "start-around."

"They're really making a big push to be a big premium content site," Emily Riley, an analyst at Forrester Research, told Capital. "Whether or not that's working has everything to do with whether the content continues to be the best. But that's kind of a boring business model."

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Armstrong is trying to divest the company from aspects of AOL's business that distract from the core strategy (including Bebo, the ill-fated social network that AOL sold last week). But even in the all-important content division, there are over 100 brands under the AOL umbrella. Some are thriving. Most are not.

As Google's head of Americas, Armstrong spent his time leading one of the most successful companies in the world through record profits. But he went to AOL last March looking to transform the culture of the company. In March, AOL gathered people from leading ad agencies for a breakfast at the offices of "its new brand strategists Wolff Olins. Armstrong explained:

"AOL was so used to losing that they didn't know what winning was."

So he's reorganized, and after a series of layoffs and an influx of new talent, he's created a new slogan for AOL in 2010: "Beat the Internet."

To do that, Armstrong is focused on creating quality content and selling premium advertising against it. Print journalism may be flailing for a business model, but AOL has spent the last year hiring name-brand journalists like former Daily News ‘Gatecrasher' columnist Ben Widdicombe, Carl Cannon from Reader's Digest and BusinessWeek's Alex Salkever. Saul Hansell left his plum role as a New York Times tech reporter to head up AOL's new SEO-friendly content-creation engine, Seed.

The company now boasts that it has the largest newsroom in the world, with 500 full-time staffers and 3,500 freelance writers. Just last week, AOL announced the company will likely double its full-time editorial staff over the course of 2010.

But beating "legacy" content organizations also means succeeding where they are failing to adapt traditional broadcast and print journalism to the current technology. That means changing the way journalism is done online.

"Journalists I met were often the only people in the room who never had access to a lot of information, except what they already knew," Armstrong told an audience at an Internet Week event earlier this month, as he described the time he's spent trying to figure out the problem of newsgathering agencies' "technological disconnect."

An early Armstrong experiment didn't bode well. In March, AOL's SEO-friendly content engine, Seed, went live at the SXSW festival with the goal of profiling all 2000 bands appearing on the festival's stages. To do this, the company relied on an untested mass of freelancers. In addition, they needed to get the Seed technology up and running and edit all of that semi-professional content that came in.

Armstrong admits it didn't go as planned.

"I went onto the SXSW site and I was horrified," he said at the Wolff Olins breakfast in March. "As a company we didn't have a bar that we set. If you talked to people at our company, they'd say they're doing A work. But I went to the site and realized, their expectation and consumer expectation … was different."

But was Seed built to develop the highest possible quality content, or to deliver a large quantity of it with minimal editorial effort from hordes of semi-professional freelancers working on the cheap?

Seed makes it a lot easier for AOL editors to crowdsource content and sign up new writers. But the implementation is still unclear. It seems eerily similar to the kind of digital-content-farm technology that is seen as the antithesis of quality journalism, and it could be a way for AOL to populate its sites with SEO-friendly assignments from faceless freelancers at a cheap rate. But editing unknown freelancers could be an expensive (or at least time sucking) endeavor for full-time staffers, if in addition to this massive delivery system the content is supposed to be good.

Armstrong, who declined an interview request for this article, has often taken issue with Seed's comparison to a content farm. But this "unset bar" he talks about is evident when you talk to AOL employees. (Interacting with AOL's PR department is a pretty clear reminder that AOL is not a startup. Caroline Campbell from corporate communications, asked to describes Seed's strategy for generating quality content, says only: "Things are evolving real time with Seed and our content strategy.")

"Seed makes it a lot easier to work with freelancers," one AOL editor told Capital. "I can put out an assignment and get content easier than ever before. But nothing gets on my site unless I approve it. And I'm not going to put crap on my site."

So the machine pulls in massive amounts of content, which then gets filtered through editors before making it onto the site.

Armstrong's "beat the internet" catchphrase is an encouragement to all AOL employees to think like that. Because essentially, many of AOL's successes and failures will come down to who is running the individual sites it owns.