Photo: Ian Ransley via Flickr
AOL made 900 hires over the summer with 50% of the new people going to local blogs network Patch, CEO Tim Armstrong just told employees in a company wide meeting.Figure all-in costs for each new employee is $100,000 per year, and AOL is set to spend $45 million per year on its new Patch employees.
That’s right in line with AOL’s previously announced plans to invest $50 million in Patch this year.
At the all-hands meeting, Tim justified the investment by explaining that the local ad market is growing much faster than the overall industry.
There could, someday, be a business in local blogs, but Tim is nuts to suggest Patch will be a “major” part of AOL’s turnaround (as he recently suggested on CNBC.)
Patch revenues are tiny and so is its traffic. As a network, it has hundreds of thousands of uniques.