Back on April 7, Tim Armstrong sent a memo to the long-battered troops of AOL about a 100-day vision quest the new CEO and chairman was going on to find out “how to bring back the magic of AOL.”

It is now Day 86, and Armstrong is closing in on the end of a Where’s-Waldo commitment that he made then to visit all of the far-flung offices of the Time Warner (TWX) online unit globally.

More importantly, as it is almost over, Armstrong also has to make good on another promise he made in that memo he sent to the staff on his first day:

“The culmination of the 100-day process will end in Dulles with an All-Hands meeting in mid-July. At that meeting, we’ll review the feedback we’ve received–both internal and external. We’ll also discuss our strategic direction for the coming years, and highlight areas that will bring AOL and AOL properties into the next decade of digital leadership. Most importantly, we will set a course and focus all of our resources to make that course a success.”

BoomTown is eager to see what Armstrong has found out on his trip and what path it will ultimately put AOL on.

So far, the broad outlines of his strategy seem to center on expanding AOL’s content assets, strengthening its advertising network and getting out of businesses the company cannot compete well in, such as social networking.

What other pearls of wisdom Armstrong has gleaned are to still to be revealed, presumably.

His corporate version of “The Amazing Race” is certainly a novel idea, born at his first all-hands meeting in Dulles, Va., which used to be the world-wide HQ of AOL and remains its heart.

There, Armstrong (pictured here) joked to the crowd:

“I know that work goes on across the globe and, in the first 90 days, I’m going to try to visit every office we have and sit down and talk to every employee and that will be something that my wife has actually agreed to let me do so.”

Thus, spouse-approved, the former Google (GOOG) exec has circumnavigated the globe and has held meeting with employees in a wide range of places: Dulles; New York; Baltimore; San Francisco; Mountain View, Calif.; Toronto, Lancaster, Pa.; Denver; Hamburg; London; Paris; Bangalore; Dublin and, this week, Tel Aviv.

But it has not been all tourism, in search of innovation.

During this time, Armstrong has also dispatched employees and top execs, such as advertising head Greg Coleman and communications and communities head Joanna Shields, and hired a few key staffers of his own; announced a pending spinoff of the company; and bought some stuff (including a company he funded).

It will be interesting to see what comes next–after the 100-day gathering in Dulles, which should come sometime after Armstrong’s July 15 deadline, of course.

Party on, Tim.

Former Google (GOOG) exec Tim Armstrong officially started his job as new AOL chairman and CEO today and sent out a hello-there memo to the troops.

According to Armstrong, he is poised to “bring back the magic of AOL.”

BoomTown loves magic tricks and certainly hopes he can pull a rabbit out of the hat at the service, which was once the dominant player on the Web.

Armstrong is promising to look closely at AOL over the next 100 days, which “will end in Dulles with an All-Hands meeting in mid-July.” (Dulles is the Virginia-based AOL outpost that was once its world-wide HQ–it is now based in New York.)

There is homework too, AOLers!

But let’s hope it is not like the 100-day exam of Yahoo (YHOO) that did not work out so well for co-founder and former CEO Jerry Yang.

One sure sign of the seriousness of turning AOL around: While he has been getting ready to begin, AOL owner Time Warner (TWX) has been getting ready for Armstrong by putting in place conditions to allow AOL to spin out, seeking to amend debt agreements that restrict it from unloading the struggling business.

Here’s Armstrong’s entire memo:

AOLers -

Our work together starts today and we’re going to bring back the magic of AOL to our consumers and our partners.

As the world continues to move toward a digital information platform, AOL sits in a unique and venerable position. We’re a global digital brand and, thanks to your hard work, more than 275 million people across the globe touch AOL and our growing sub-brands every month. Billions of consumers and millions of businesses are making the digital migration, and we have a tremendous opportunity to help improve the experiences of all the people and companies making the transition.

We’ll make the decisions and the investments that are required to deliver exceptional value to our consumers. Consumers vote with their clicks and the time they spend on our sites, and we need to make world-class products and services that get votes based on a superior consumer experience. AOL’s partners and advertisers expect no less than our consumers, and we need to hold ourselves to delivering industry-best business solutions.

Over the next 100 days, I’ll be running a process to hear from all of you and many of the important partners connected to AOL. We’ll sit together in our offices around the world and have open forums about what we’re building for the future and what we’re accomplishing today.

The culmination of the 100-day process will end in Dulles with an All-Hands meeting in mid-July. At that meeting, we’ll review the feedback we’ve received–both internal and external. We’ll also discuss our strategic direction for the coming years, and highlight areas that will bring AOL and AOL properties into the next decade of digital leadership. Most importantly, we will set a course and focus all of our resources to make that course a success.

The road to Dulles in July starts this week with meetings in New York, Dulles and a Town Hall meeting with the team in Baltimore, and I plan to visit all of our global offices in my first 100 days. It is important for you to think about how AOL’s mission should be captured–how we can deliver exceptional value for consumers and partners, how we can encourage innovation, and how we can continue to make AOL an even better place to work. If you have thoughts before we meet, you can post them here and I will read them as we travel to all the offices.

Joining you today is a privilege and an honor. Over the past few weeks, I’ve had many opportunities to talk to current AOLers, AOL alumni and our partners. Each of them asked how they could help AOL revive the spirit we talked about in the tent in Dulles a couple of weeks ago–a spirit of dreaming big and delighting consumers every time they touch our brands. Jeff Bewkes and the leadership across Time Warner are putting their full support behind making AOL as successful as it can be. Now it is up to us to deliver on AOL’s full potential.

Thanks for having me and let’s set our sights high and our execution even higher. Go AOL.

- TA

That was fast.

Longtime–well, five years, which is a dog’s age at the search giant–Google sales exec Dennis Woodside (pictured here) will become VP, Americas Operations, replacing outgoing exec Tim Armstrong, who was named chairman and CEO of Time Warner (TWX) online unit AOL last week.

Woodside, 40, will start in the next few weeks, said Google (GOOG) in an internal communication about the appointment, as Armstrong transitions from Google to AOL. It is the key advertising sales job at Google.

Armstrong has already been hard at work at AOL, in fact, leading an employee rally today at its former HQ in Dulles, Viriginia, which included former AOL execs Steve Case and Ted Leonsis.

(And he will hold a similar meeting at AOL’s New York office tomorrow, BoomTown has been told. But let’s hope he does not roll out, say, former Time Warner CEO Jerry Levin, which would be taking this old-home-week stuff too far!)

While Woodside is a well-known exec within Google, his name was not as prominent in the speculation about which internal Googler would be named by CEO Eric Schmidt to replace the well-known Armstrong.

Wrote MediaMemo’s Peter Kafka last week, for example, when the Armstrong departure was announced:

“According to a (very informal) flash poll of Googlers, ex-Googlers and Google competitors I conducted last night, the answer should be obvious: David Rosenblatt, the former Doubleclick CEO, who now runs Google’s display business.”

Woodside will also have a slightly lesser title than Armstrong, who was a corporate SVP, was president of the America Operations and was also on Google’s powerful operating committee.

But that’s part of the changes, mentioned in a long statement by even bigger sales boss Omid Kordestani, SVP, Global Sales & Business Development, to whom Woodside will report (the key graph is the last one, although the golf dig is funny):

In the five and a half years that Dennis has been at Google (that’s over half our company’s lifetime) he’s brought incredible integrity and entrepreneurialism to everything he’s done. I remember Dennis setting off from Mountain View in 2005, a year and a half after he joined, to start our direct sales operations in Eastern Europe, which he quickly transformed into a substantial part of our business. He also set up our Inside Sales Operations in Dublin – again building it from scratch. In September 2006, he became our Vice President for the UK, Ireland and Benelux where he’s helped to create a first class team as well as establish very positive relationships with our big partners on both the advertiser and agency side, including 02, Marks & Spencer, Amazon and Omnicom.

Ever since I met Dennis in 2003, I have been impressed by his combination of entrepreneurialism and operational excellence. He’s never afraid to try new things and always ready to roll up his sleeves and pitch in–whether it means moving his desk to sit with the UK DSO team to see the operations first hand, or being the customers’ advocate internally to help product and engineering better understand market trends. Outside work he loves to do triathlons–though I would only recommend training with him if you don’t mind being out-run (if you are looking to beat him, try golf).

While we are all sorry to see Tim move on, change always brings new opportunities. We believe it’s now time not just to roll-out globally the best practices from the different regional sales teams–the Americas, EMEA and Asia Pacific–but also to tailor our business strategies more closely to the different situations we face in different countries (more mature versus less mature markets).

As BoomTown reported earlier today, AOL was abuzz with the rumors that former execs from the online service’s glory days, including still controversial former CEO Steve Case (pictured here), might make an appearance at a huge staff pep rally called by its new CEO Tim Armstrong.

And so Case did show up in front of a cheering crowd this morning, along with former AOL vice chairman Ted Leonsis.

Considering that many at Time Warner (TWX), which owns AOL, still harbor resentment towards Case about the disastrous merger between it and AOL a half-decade ago, the move is groundbreaking for the troubled online service and perhaps a sign that it is finally time to move forward.

In related news, Sasquatch will appear on the Time Warner-owned CNN’s “Larry King Live” show tonight.

The appearance by Case took place on AOL’s former HQ in Dulles, Virginia, on the tented lawn of the sprawling campus for the company, which only a decade ago was the dominant online powerhouse.

The event was broadcast to the AOL empire worldwide, reaching thousands of employees, and included all of AOL’s top execs and several from Time Warner, such as General Counsel Paul Cappuccio and CFO John Martin.

Leonsis, who gave a “lucky” green tie to Armstrong, engendered cheers as he spoke of the importance of change.

But it was Case’s entry that was a shock to the standing-room only audience of 1,000. He told the crowd that he would be a “cheerleader on the sidelines” for AOL.

Both Case and Leonsis talked about putting the past behind the service–and there is a lot of past to put behind, I might add, between AOL and the media giant–and were very supportive of Armstrong.

Armstrong, who was a key advertising exec at Google (GOOG), made the point of joking that Case and Leonsis were “on the payroll” at AOL again.

Armstrong focused mostly on AOL products, rather than its troubled history, employee morale and the importance of reviving the famous but tarnished brand.

And to get AOLers jazzed again about reviving the service, Armstrong asked rhetorically: “Are you committed to putting America back online?”

As soon as he got his new job last week, new AOL Chairman and CEO Tim Armstrong sent out a rather hopeful email to the troops–his first communication as the latest leader of the ragtag online service.

“I’m really looking forward to seeing you and would love to hear your thoughts and suggestions,” wrote the former Google (GOOG) exec Friday (who alarmingly kind of resembles this Elvis image), “on how to make AOL and its sister properties the most powerful brands on the Internet.”

Well, one can hope!

To goose that dream, although he still does not officially start in the job until April 7, Armstrong is also addressing all the troops tomorrow at 11 am EST and has chosen to do so from, of all places, AOL’s old center of power in Dulles, Virginia.

AOL staffers I spoke to also hope most of all that Armstrong will quickly and transparently lay out plans for a spin-out of the Time Warner (TWX) online unit from the media conglomerate, where it has languished for years.

“Armstrong would not have taken the job if the plans for a spin out of AOL were not in place and it’s in everyone’s interests to signal that it’s a go right away,” said one source close to the situation. “The only catch is the poor economy, but even that should not prevent Time Warner from doing what’s right to finally fix AOL.”

And sources said Armstrong could further up the ante tomorrow and help raise the layoff-weary morale by having some former AOL execs from its glory days as the top online player in person at the event.

Several sources said one exec most likely to make an appearance is Ted Leonsis (pictured here), one of AOL’s most colorful top early execs and a longtime inspirational figure within its ranks.

Unlike most AOL execs from those days, many of whom were eventually run out on a rail, Leonsis also stayed on through its disastrous merger with Time Warner and beyond.

But, like all of the Dulles complex–which was once the bustling worldwide HQ for AOL–Leonsis finally left the company, after a falling out with the management regime that Armstrong just hipchecked out of power. He is now AOL’s vice chairman emeritus.

Both CEO Randy Falco and President Ron Grant moved AOL’s locus largely to New York, and minimized the staff and influence at Dulles, where most of AOL’s products have been made since its origins in the early 1990s.

“It’s a smart move to go to [the Dulles staff] directly first…the last regime pretty much shut them out…and that created bitterness, when we need to be unified,” wrote one AOL insider to me in an email.

(Sidenote: As the AOL beat reporter at the Washington Post back then, I actually went with then-PR head Jean Case to look over what became the Dulles facility, to see if it would be a good place to expand to; previously, AOL was located in nearby Vienna, behind a car dealership.)

A Leonsis visit at AOL will be like old home week, although some are hoping too that former AOL CEO Steve Case could also make an appearance. He and Leonsis still make online investments together.

But that might still be deeply controversial within Time Warner, where Case and also former Time Warner CEO Jerry Levin are widely blamed for situation that the company found itself in when the Web 1.0 bubble burst and AOL’s once vaunted valuation collapsed.

Although Case and Time Warner CEO Jeff Bewkes have since moved on, bygones have not been bygones within Time Warner.

And, while it is often denied by top execs, AOL has suffered because of ill-hidden grudges, which have partly prevented it from being revived, even as other Internet giants have been born in the interim.

Ironically, many of the current crop of shooting stars owe a lot to the pioneering and innovative AOL products, including: its AIM and ICQ instant messaging services, which echo an early version of Twitter; the “Buddy List,” which was all about friending; and its deep social networking roots, with chat rooms and profiles that were the Facebook of its day.

The question for Armstrong is: Can AOL go home again?

Microsoft CEO Steve Ballmer made an appearance at the three-day U.S. House of Representatives Democratic Caucus Retreat today to talk about innovation and, let’s be real, the very bad economy and the impact on businesses like the tech giant.

Held at the Kingsmill Resort in Williamsburg, Va., the confab has already seen an appearance by President Barack Obama yesterday and one by Vice President Joe Biden this morning. Ballmer got the lunch spot.

The annual gathering is more crucial this year, given the pressure to pass the massive economic stimulus package to try to revive the moribund economy.

Ballmer was not reassuring. “The bubble has burst,” said Ballmer. “We can no longer rely on consumption by refinancing our homes or inexpensive money to fuel economic growth, and that’s certainly had a huge impact.”

And also: “In my view, what we now have will be a fundamental economic reset.”

Microsoft (MSFT) should know all about that. The powerful company recently announced weak earnings, a foggy outlook and layoffs of 5,000 employees.

Here’s Ballmer’s speech to the group:

Well, I want to thank Jay, I want to thank the speaker and all of you for the opportunity to be here today and chat with you. It’s a real honor to have a chance to share some thoughts on the economy and on innovation, and hopefully spur some thoughts on how we all participate in restarting long term economic growth.

I’m going to make one thing clear up-front: I’m not going to claim to be an economist. On the other hand, I think it’s sort of the responsibility of every businessperson to really form a model of what’s going on in the economy, if you’re going to provide proper stewardship to your business; big company, small company, it’s important to have a model of what’s going on, and certainly have been thinking a lot about the economy in the context of how we think about and plan for the future of Microsoft.

For the past 25 years, the world has certainly enjoyed incredible, incredible global growth. Average incomes around the world grew at unprecedented rates, millions of people moved from out of poverty into the middle class for the very first time.

I thank you again for the opportunity. It’s been my pleasure.

Time Warner online unit AOL is cutting 700 employees due to the weak economy and the ensuing falloff in advertising revenue, but also because of recent structural changes made to refocus the once-mighty service.

AOL CEO Randy Falco sent a memo this afternoon to AOL staff about the layoffs and other cost cuts being made, confirming the moves.

The 10 percent reduction in workforce will take place over the next several quarters, with most of the U.S. layoffs to be completed by March. AOL has 7,000 employees world-wide, mostly located domestically.

AOL is also eliminating merit raises, just as Yahoo (YHOO) and other digital companies have done recently, and consolidating facilities.

While Time Warner (TWX) has been trying to sell AOL to Yahoo, the online unit has also been shifting its resources, as part of a long-term turnaround plan. It has focused the company on three parts: its Platform-A ad unit; its communications and social-networking arm, People Networks; and its recently launched MediaGlow content studio.

It has also been in the midst of splitting out its longtime access business, which has provided the bulk of AOL’s revenues and profits, which sources said has given its top execs insight into what its future business model should be.

Besides the layoffs and cost cuts, sources said AOL was also looking at paring its international business, which has never been particularly successful.

As part of its ongoing moves to make New York its main HQ, AOL will also be consolidating facilities in Silicon Valley, Los Angeles and at its original homestead in Dulles, Va., although not closing it completely.

Much as throughout the online advertising industry, AOL has seen drastic declines in growth. In a recent financial report, AOL said its ad business dropped almost 20 percent year over year.

And AOL’s worth has also declined, with Google (GOOG) recently writing down its 2005 investment of $1 billion in the online service, which valued it then at $20 billion. It is now valued at $5.5 billion.

BoomTown extends apologies to the late Francis P. Church, who penned the original “Yes, Virginia, There Is a Santa Claus” editorial in the New York Sun on Sept. 21, 1897.

But with just a little rejiggering, his eloquent words work perfectly as a translation for Apple’s press release about its withdrawal from San Francisco’s Macworld and no keynote speech from Apple CEO Steve Jobs yesterday, which doubtlessly shook the Apple (AAPL) faithful to the core.

Oddly enough, it matches up surprisingly–and a little disturbingly–well.

Thus, here’s a little holiday inspiration to help those poor souls make it through these darkest of days:

Dear Editor:

I am 28 years old. Some of my little fanboys say there is no Steve Jobs at Macworld. My imaginary friend at AppleInsider says, ‘If you see it on BoomTown, it’s so.’ Please tell me the truth, is there a Steve Jobs?

–O’Hanlon, a geek in Virginia”

Apple wrote: CUPERTINO, California—December 16, 2008—Apple today announced that this year is the last year the company will exhibit at Macworld Expo. Philip Schiller, Apple’s senior vice president of Worldwide Product Marketing, will deliver the opening keynote for this year’s Macworld Conference & Expo, and it will be Apple’s last keynote at the show. The keynote address will be held at Moscone West on Tuesday, January 6, 2009 at 9:00 a.m. Macworld will be held at San Francisco’s Moscone Center January 5-9, 2009.

Translation: Virginia geek, your little friends are wrong (and they also have no life, which is self-evident). They have been affected by the skepticism of a skeptical age. They do not believe except they see. They think that nothing can be which is not comprehensible by their little minds. All minds, Virginia geek, whether they be men’s or children’s, are little. Not as elegantly tiny as the iPod Nano, but little nonetheless. In this great universe of ours, man is a mere insect, an ant, in his intellect as compared with the boundless world about him, as measured by the intelligence capable of grasping the whole of truth and knowledge.

Apple wrote: Apple is reaching more people in more ways than ever before, so like many companies, trade shows have become a very minor part of how Apple reaches its customers. The increasing popularity of Apple’s Retail Stores, which more than 3.5 million people visit every week, and the Apple.com website enable Apple to directly reach more than a hundred million customers around the world in innovative new ways.

Translation: Yes, Virginia geek, there is a Steve Jobs. He exists as certainly as love and generosity and devotion and the fabled touchscreen tablet Mac exist, and you know that they abound and give to your life its highest beauty and joy. Alas! how dreary would be the world if there were no Steve Jobs! It would be as dreary as if there were no amazingly great iPhones. There would be no childlike faith then, no poetry, no romance, no Pull My Finger app to make tolerable this existence. We should have no enjoyment, except in sense and sight. The eternal light with which childhood fills the world would be extinguished.

Apple wrote: Apple has been steadily scaling back on trade shows in recent years, including NAB, Macworld New York, Macworld Tokyo and Apple Expo in Paris.

Translation: Not believe in Steve Jobs! You might as well not believe in those admittedly freaky iPod shadow dancers. You might get your other pretend friend at MacRumors to hire men to watch in all the Chinese manufacturing factories on Christmas eve to catch Steve Jobs, but even if you did not see Steve Jobs ordering up new Mini desktop computers, what would that prove? Nobody sees Steve Jobs, but that is no sign that there is no Steve Jobs. The most real things in the world are those that neither children nor men can see. Did you ever see the iPod dancers dancing bizarrely on the lawn? Of course not, but that’s no proof that they are not there. Nobody can conceive or imagine all the wonders there are unseen and unseeable in the world.

Apple wrote: Apple ignited the personal computer revolution in the 1970s with the Apple II and reinvented the personal computer in the 1980s with the Macintosh. Today, Apple continues to lead the industry in innovation with its award-winning computers, OS X operating system and iLife and professional applications.

Translation: You tear apart the baby’s rattle and see what makes the noise inside, but there is a veil covering the unseen world which not the strongest man, nor even the united strength of all the strongest men that ever lived could tear apart. Only faith, poetry, love, romance, and the fact that the Mac guy vs. PC guy ads are pure genius can push aside that curtain and view and picture the supernal beauty and glory beyond. Is it all real? Ah, Virginia geek, in all this world there is nothing else real and abiding.

Apple wrote: Apple is also spearheading the digital media revolution with its iPod portable music and video players and iTunes online store, and has entered the mobile phone market with its revolutionary iPhone.

Translation: No Steve Jobs! Thank God! he lives and lives forever, despite Henry Blodget-fueled health rumors to the contrary. A thousand years from now, Virginia geek, nay 10 times 10,000 years from now, he will continue to make glad the heart of Mac fanboyhood.

In a move to dramatically increase its traffic and give it more tools to offer publishers, Clearspring Technologies said it will acquire AddThis, the top bookmarking and content-sharing tool on the Web.

As with many social-networking start-ups, whether this disparate traffic can be easily translated into a reliable revenue-generating business remains to be seen.

The McLean, Va.-based Clearspring–one of several widget networks seeking to connect publishers and advertisers with social tools by helping them embed small pieces of content across the Web and monetize that content–would not disclose the price it paid for the Princeton, N.J.-based AddThis.

My guess: A few million dollars in cash and maybe more in some kind of stock swap.

What exactly is Clearspring getting for this?

For starters, a tiny icon with a lot of popularity to help it toward its goal of being the universal sharing standard in the new socially-networked Web paradigm.

Clearspring claims the pair together will reach 20 billion views per month and more than 200 million unique visitors, noting it would now have a “worldwide audience comparable to the seventh largest Web property.”

While adding up such piecemeal traffic is not quite the same to advertisers as a major central Web site like Yahoo (YHOO), for example, AddThis is the most used tool for sharing Web pages through email or from Web site to Web site.

Its main competitors are ShareThis and Yahoo’s Del.icio.us, even though it has only a handful of employees.

Of course, that viral success around universal sharing might not mean massive revenue generation, even if it is a popular consumer tool.

But Ted Leonsis, chairman of the board at Clearspring, and CEO Hooman Radfar said revenue would come via advertising and, eventually, valuable data analytics the services collect about Web behavior.

Currently, said Leonsis, AddThis has negligible revenue and Clearspring has about $10 million in annual sales. Neither is currently profitable.

Nonetheless, Radfar said, “AddThis is the biggest small thing on the Web,” referring to its tiny icon that expands to offer users a choice of Internet sharing services and updating tools to a variety of social networks.

And indeed, AddThis icons are widespread across the Web, seen mostly at the bottom of content items on big sites like Time.com and MySpace.

While some question whether a big business can be created through such a far-flung network, Leonsis–one of the early execs at AOL in its glory days–said it was how the Web is evolving.

“If you said to me 10 years ago that you were going to be successful by sending people away from your site, I would have said you were crazy,” said Leonsis. “But that is what the Web is about now, and having a central network that can track this is important for advertisers.”

Well, we’ll see about that, but Clearspring certainly has a lot of money to try.

The company has received more than $35 million in funding since it was founded in 2004. Investors include former AOL head Steve Case, as well as the venture firm New Enterprise Associates.

Clearspring has about 100 employees.