BoomTown has learned that AOL is offering those who “volunteer” to leave the company now a departure package that ranges from three to nine months of pay, compared to one to four months for employees laid off in the first quarter of next year.
It’s a depressing rock-and-a-hard-place choice.
An AOL spokesperson confirmed the offer, which is part of a massive layoff of 2,500 of its 6,000-person workforce.
Yesterday, BoomTown wrote about AOL’s efforts–including hiring investment bankers–to sell its ICQ instant-messaging unit.
But that’s probably not going to be the end of the shedding of assets at the online site.
In fact, according to sources inside and outside AOL, one of the next candidates for sale could be its MapQuest online map service.
AOL has hired a pair of New York investment bankers, Morgan Stanley and Allen & Co., to manage the sale of its ICQ instant-messaging unit.
Sources familiar with the situation said interest in buying the asset from two major non-U.S. companies prompted execs at the online service to put a process in place for a deal that will likely occur after AOL becomes an independent company in December.
AOL bought ICQ in 1998 for about $400 million–$287 million outright and $125 million in earnouts for the team.
Sources said AOL to looking to recoup $300 million.
AOL will officially be spun off from Time Warner on Dec. 9, with trading to begin the next day.
Shareholders of record at 5 pm ET on Nov. 27 will get one share of AOL for every 11 shares of Time Warner on the day of the long-expected spinoff of the Internet service.
AOL will trade on the New York Stock Exchange as “AOL,” just like the old days. Unlike the old days: Time Warner has given the company an implied valuation of a little more than $3 billion.
Essentially–although AOL is located in New York and not California–it’s going to be like tremors before the Big One at the online company today as about 100 employees are set to be laid off by management.
It is part of AOL CEO Tim Armstrong’s “Project Everest”–the code name for cost-cutting across the company. After this small cut, there could be a call for voluntary departures, followed by a much more drastic layoff.
The action comes in the same timeframe as the online site’s spinoff from Time Warner.
Tony Conrad, CEO and co-founder of Sphere–the contextually relevant content engine AOL bought in the spring of 2008 for upward of $25 million–left the Time Warner online unit last month, several sources have told BoomTown in recent weeks.
But, in an effort by AOL’s CEO Tim Armstrong to hold onto entrepreneurial talent, Conrad has agreed to become “Special Advisor” to its AOL Ventures Unit.
Apparently, he is also mulling a new start-up and remains a VC too.
For the past few months, the Huffington Post has been on a bit of a tear–both in terms of traffic gains and in its hiring of some big talent for key positions.
Now, those execs are focusing on using that consumer momentum to achieve what has eluded the Huffington Post thus far: Making some serious bank from the privately held news and media site.
Here’s a chat I had with new President and Chief Revenue Officer Greg Coleman about how he is aiming to do just that.
Four years ago, the movie, “Snakes on a Plane,” became a genuine Internet phenom well before the movie was in theaters.
Which, in the end, only showed that online buzz had negligible impact on the viewing public, given that the movie’s box office turned out to be tepid at best.
But will another small film, about a demon-plagued couple with an infrared-equipped videocamera, called “Paranormal Activity,” prove that the chatter of Facebook and Twitter has more legs today?
In the ongoing fight between Redbox–which rents DVDs from kiosks for $1–and major Hollywood studios, 20th Century Fox Home Entertainment just filed a brief to dismiss Redbox’s lawsuit against it.
The fascinating legal battle between Redbox and the studios centers around the issues of steep discounting, windowing and the price for premium content.
According to sources close to the situation, AOL has been busy selecting the board for the company, which is still set to spin itself off by year’s end–even as it slows down a decision on a new search deal with either current partner Google or a more emboldened Microsoft.
AOL is using Spencer Stuart in the search for directors, led by well-known headhunter Jim Citrin, sources said, and the company has already settled on several outside candidates.
Here is a video interview I did today with AOL CEO Tim Armstrong in Germany–really!–where we both were appearing at a digital marketing conference.
In it, the former Google exec talks about a range of things, including the possibility of charging for content, innovating in the graphical advertising market, competition with Yahoo and the upcoming spinoff of the Time Warner unit.
But what he did not say is just as interesting.
Former Bebo CEO Joanna Shields and Shine Group Chairman and CEO Elisabeth Murdoch have formed a content start-up to produce across media platforms, both online and offline, with a focus on social engagement, according to sources.
The new venture, which does not have a name, is being financially backed by both Shine and Shields.
Based in London, it will invest, develop and partner to create a variety of content offerings that also incorporate interactive and social networking elements.
In the ongoing game of Internet exec musical chairs, Greg Coleman, who has been a top exec at both Yahoo and AOL, is poised to become president of the Huffington Post, as well as chief revenue officer, several sources said.
The deal for Coleman to come on board at the privately held online news site–which has grown significantly over the last year and just added well-known online media exec Eric Hippeau as CEO–came together only recently.
Time Inc.’s Fortune magazine–which never met a list it did not like to make–had a solid group of women tech types on its “50 Most Powerful Women 2009” roster, the annual survey that it posted yesterday.
Yahoo CEO Carol Bartz made the Top Ten this year, clocking in at No. 8, along with a lot of other tech-savvy women in Silicon Valley and elsewhere.
Longtime Yahoo exec Brad Garlinghouse’s appointment to a new job at AOL today is yet another sign of an interesting trend for those keeping score of the comings and goings of top Internet execs.
As anyone who watches the digital space knows by now, this kind of management musical chairs is common and never-ending, although it seems more frantic than ever of late.
In fact, borrowing a quote by IAC/InterActiveCorp chairman and CEO Barry Diller from an onstage interview I did with him at the sixth D: All Things Digital conference, and switching out Hollywood for Silicon Valley: “[It] is a community that’s so inbred, it’s a wonder the children have any teeth.”
Kara Swisher started covering digital issues for The Wall Street Journal's San Francisco bureau in 1997 and also wrote the BoomTown column about the sector. With Walt Mossberg, she co-produces and co-hosts D: All Things Digital, a major high-tech and media conference. Read more »
Here is a statement of my ethics and coverage policies. It is more than most of you want to know, but, in the age of suspicion of the media, I am laying it all out.
D is unlike any other executive conference. Since its debut in 2003, D has brought to life the energy and excitement of the digital revolution in an unscripted, upfront and unparalleled way. Read more »
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