Accuracy in Media

According to the New York Post, the merger of AOL and the Huffington Post, which is approaching its one-year anniversary next week, has been an utter disaster — for AOL.

One year after getting into bed with the media princess and plunking down $135 million to buy the Huffington Post, the AOL boss has seen traffic on his Web site fall to where the ubiquitous e-mail voice should be saying, “You Got Nailed.”

Nailed indeed. According to the Post, citing Nielsen, web traffic is down at AOL from 78.9 million unique visitors per month to 73.6 million.

Even worse, though, is the stock price. At the time of the merger AOL’s stock was trading at $21.19 per share for a market value of approximately $2.1 billion. On Friday the stock closed at $16.07, or 24% lower, which translates to a loss of over $500 million in market value.

The only positive development, if you can call it that, is that the stock price has recovered from its post-merger low reached in September when it was off nearly 47% from the day the merger was completed.

AOL thought they had latched onto a winning growth strategy by acquiring HuffPo, as it is more commonly known, but instead wound up not only taking a back seat to their acquisition, but taking a huge financial hit in the markets as well.

Score this one as a big victory for Arianna Huffington and a black eye for AOL.





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