Photo: Illustration by Business Insider
We’ve been talking to sources close to top AOL executives – some who are former employees – and they shared a little insight into the state of the company right now.Here’s what we learned:
- Arianna Huffington and AOL PR have told the press that she did not know Arrington, the editor of a site about tech startups, planned to be a VC investing in startups. Actually, say sources, she knew about Arrington’s plans two weeks before the story broke.
- Huffington is a “perfectionist” who is “in the weeds,” says one source. She is also AOL’s product visionary. She cannot be managed. Another source says AOL is The Huffington Post Media Group now.
- One source told us that Tim Armstrong is someone who does not like to make hard decisions, and that the Arrington mess was just a public display of this flaw. Another source said Armstrong will make the tough decisions, but that he’s lousy at communicating his decisions to people who need to know them.
- (Counterpoint: Armstrong has obviously made some tough decisions. He pulled the trigger on a big acquisition, made a big bet on Patch, and laid off a bunch of people a few years ago.)
- One source says the public perception of Tim Armstrong as a charismatic leader is accurate. “He’s like Mel Gibson in Braveheart.” The problem is that there’s not much execution behind the pep. “He’s great at recruiting and firing up new lieutenants, but look at how many leave him,” says a source. Long time Armstrong lieutenants Jeff Levick and Brad Garlinghouse have recently departed the company.
- Speaking of Garlinghouse. Some sources suggest it’s inaccurate to say the former AOL product boss and West Coast leader “quit.” It’s probably also too harsh to say he was fired. What really happened was that Armstrong and AOL CFO Artie Minson decided to shrink his role; he didn’t like it; he quit.
- One source described Garlinghouse as a charismatic, image-conscious empire-builder. He’s the kind of magnetic leader needed inside a company trying to make a turnaround. He didn’t ship enough.
- One source laid the blame for the massive sell-off of AOL stock after it reported Q2 earnings squarely at CFO Artie Minson’s feet. This source said that the reason shareholders sold off so much was that AOL guided its Q3 profit expectations down from ~$90 million to ~$60 million during the Q2 call. This was a mistake, in this source’s view, because AOL ended up reported profits near $90 million in Q3. (It’s also fair to point out that the week AOL reported Q2 earnings was during the whole debt-ceiling crisis.)
- This source thinks Minson is a B player who plays defence, not offence.
- One source says AOL ad boss Jeff Levick was fired after those Q2 results as something of a sacrificial offering to shareholders. Ironically, most of the sales that helped AOL beat its Q3 numbers were booked while Levick was still running the show.
- An Artie Minson defender says that he is an A+ player, but only at what he does best: operate and optimise. That’s why he’s been put in charge of AOL’s subscription businesses – to juice them for all they are worth and to even grow them if possible. Arianna’s job is to take that money and grow a brilliant new business in media.
- One source says product people in Dulles are depressed to have a CFO running their shop.
- One insider says Tim Armstrong’s closest lieutenant is Jon Brod, who cofounded Patch, ran AOL Ventures for a while, and is now back at Patch.
- There’s been speculation that eventually either Huffington or Armstrong will have to leave AOL. One source dismisses this – and says that the pair get along very well. Armstrong is not threatened by her. He’s rich from his days at Google, and industry bigwigs like him.
- One source says Huffington Post’s advertising revenues are currently flat to down since its been acquired by AOL. This source says Huffington believes the problem is AOL’s sales force. AOL’s sales force, says this source, believes that Huffington Post content isn’t high quality enough. (AOL’s display ad revenues have actually improved quarter-over-quarter, but it does not break out Huffington Post revenues.)
- One source says Armstrong tells employees that AOL is attacked in the press because the press is owned by media companies and AOL is disrupting the media business.
Briefed on its details, AOL declined to comment on this post. Here is a close-up of Tim Armstrong looking like Braveheart:
Photo: Illustration by Business Insider