AOL Close to Buying TechCrunch

143 thoughts on “AOL Close to Buying TechCrunch”

      1. I would think because being bought by AOL is about as timely as being bought by the East India Company. I hope Arrington gets a lot of cash for his retirement (or next startup), but being owned by AOL puts a neon sign reading “Owned by obsolete old fogies” on the place.

        Seriously… this sounds like Mike is taking a cash payment to ride off into the sunset, safe in the knowledge AOL won’t have a clue on how to manage the TC brand.

      2. The only way this makes sense to me is if TC wanted to reach a more mainstream audience. Unfortunately that would’ve worked a lot better back when AOL was still part of Time Warner. So I’m not sure where AOL is planning to go with this. Granted, their strength is the portfolio of online content they own (http://corp.aol.com/products-services/content), but is there a synergy there I’m missing? Is AOL going to bring a bigger audience to the table? … better advertising revenue? I suppose it’s possible.

        It just seems an odd union. It’s not like AOL is at the center of the tech universe. Headquarters on the “other” coast, dwindling email and subscriber offerings, etc.

    1. I agree as well.

      @Om – From my subjective view, I don’t like being a part of sites/blogs that are owned by large media conglomerates. I don’t even like reading those sites generally because you never really know if the stories are biased or have some arterial motive. Yes, you could argue that is the case with any site, but my take is that happens a lot more on the large AOL/Yahoo!/etc. owned sites. People want to part of a community/blog/etc. that isn’t a part of some large corporate Walmart style empire. They want something that is unique…their own.

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    1. Don’t you think he’d stay on and continue to develop content and cull stories for them? He’s such a huge force there that I’d be surprised if the deal didn’t involve him staying on for at least some predetermined amount of time.

      1. Techcrunch is making about $10 million/year, according to Inc. magazine.
        How much AOL would pay? 10x the revenue? 5x? Sometime ago (2 years, i think) it said Techcrunch is valued at about $100 million…

      2. “Techcrunch is making about $10 million/year, according to Inc. magazine.”

        I’m assuming you meant that they’re pulling in $10 million a year in revenue, not making $10 million a year in profit.

      3. Wish they’d still have the pricing on their ads like in the past.

        I also asume there’s plenty of placed content (specially by Apple, anybody read MG Siegler will suspect this)

        According to compete they have about 2,300,000 uniques a month, but compete always underestimates, so they probably have an average of 3,000,000.

        To round up, say their avg CPM is about $25 x 2,300 = that’s about $57,000 for just one ad

        They have well over 10 ads, plus lots of links and content placed by Sillicon Valley’s creme de la creme. Let’s say they make good $700k, maybe even a $1,000,000 per month.

        Multiply by 5 years, that’s close to $100mil considering the Michael Arrington brand who’s been quoted in every news outlet worldwide.

  3. Do you think the Angelgate reporting from Arrington, was linked to the fact that he was talking with AOL? It was pretty bold of him to be burning some bridges.
    My conspiracy theory Arrington style 🙂

  4. Aolnews.com has a backlink to engadget.com with an anchor text “Tech News”. Will it be switched to point to TC if this sale happens? Currently with this search term, Engadget is #4 in Google and TC #9.

  5. I think we should all speculate on price – my guess will be $35 to $40 mil. TC’s a premier web property but not a massively profitable cash-cow. Its viewership has steadily grown in the last few years, but not the number of interested sponsors. The conferences (now 2x per year) have come to represent what the ‘business’ of TC is all about. How else could the site support such a sizeable full-time staff for a blog. Congrats Mike if this is true/happens. The timing certainly makes sense – might as well bag the revenue of TC SF before handing over the reins.

  6. This looks like a template for almost every acquisition TechCrunch has written a speculation post–formula post is formulated:

    1. Name potential Acquirer of company.

    2. Claim deal is at sensitive stage

    3. Provide remotely possible peripheral context

    4. Suggest no one is talking

    5. Profit

  7. With any luck (fingers crossed) this will end the ‘we only write about start-up’s our friends own, we have stake in our that sign massive advertising deals at ridiculous prices’ era of TC..

    Most biased, unreliable and worst run site online since 2005

  8. Knowing both parties personally, this doesn’t surprise me. The new management in the Consumer Applications group headed up by Brad G is pretty chummy with Mike. Moreover, AOL has a pretty big budget put aside for acquisitions (even more for a “home run company”).

    I predict the sum to be pretty substantial, but the inner-workings of the deal (including things like “phantom equity” – which is a term that has been thrown around quite often @ AOL when talking to possible acquisitions) will be even more attractive for individuals like Mike.

    Not sure how I feel about this really, but it doesn’t seem too outlandish to me.

  9. TC-AOL deal makes sense.

    Startup Weekend has events across the globe. TechCrunch focus on covering Web 2.0 sector start-ups needs to expand its coverage.

    As always M&A risks integrating company cultures requires thoughtful management to create value.

  10. AOL needs to do something. TC would certainly help on the traffic side. I agree that if it is a cash out kind of thing for Mike then TC is dead. BUT maybe AOL is ready to admit they need to do something different and Mike is going to end up with a big role, budget, and room to get something done. Now that would be interesting. Otherwise it’s just online boy makes good which is still great news for everyone working hard to figure it out online.

    1. Kris, aol.com has a Alexa traffic rank in the US of 15. TechCrunch? 123. Given that I doubt aol.com is selling out its ad inventory at present, I don’t think adding TechCrunch to the mix is about gaining additional traffic.

      What TechCrunch does have is a demographic that’s almost exactly the inverse of aol.com: while aol.com is predominantly aged 45+, TechCrunch is mostly 25-34. TechCrunch’s audience is high on graduates, low on no/some college – again, the inverse of aol.com.

      In other words, if you look at TechCrunch as a niche site that appeals to a specific demographic that AOL doesn’t serve well in terms of audience, it starts to make sense. It fits in well in terms of being an additional offering to advertisers as part of the overall AOL portfolio.

      But would it be $100 million-worth of eyeballs? I doubt it – unless AOL believes it could grow traffic a lot, and sell ads much more effectively than TechCrunch is currently doing. If TechCrunch was doing $20m revenue, I’d say $100m was a good deal for AOL. If it’s $10m revenue – and I’ve heard less, a lot less – than $100m would be a sucker’s money.

      1. This assessment is partially right, yes they want to gather the demographic, but I think they want to grow it even more under AOL’s banner for reputation,. The fine line they have to walk remains to be seen and it is one of resources poured into TC and hands off of MA and his process. Thats where I am leery of AOL’s ability to acquire and just step the hell back!

  11. If I recall correctly… GigaOm was *this* close to being acquired / merged within AOL during Jon Miller’s reign, shortly after their Weblogs, Inc. acquisition. (Wasn’t it during Late April, 2006?)

    What say ye, Om? 🙂 No disclosure needed there?

  12. Awesome news for TechCrunch crew and breaking for me 🙂 AOL really needs to do something innovative in order to compete current market, acquisition is good but not the best solution. Hope to get best out of this deal.

  13. Did Rupert Murdoch’s acquisition of the Times group spoil the Times, etc to a significant extent? Has Lebedev’s acquistion of the (London) Evening Standard spoiled the Standard? No, actually Lebedev has a hands off approach to the Standard and it’s going free has dramtically increased its distribution numbers and revenue and it is now “in danger of making less of a loss” according to a senior editorial person on the Standard (heard last week). So this could be good news, not bad, for Tech Crunch too if AOL wants it to be.

  14. Perhaps now TechCrunch will have some badly needed adult supervision. Arrington, a failed attorney and the co-creator of the epic fail Crunchpad, is the ultimate tech wanna-be. His grandiose blogs often sound impressive, but are often spectacularly wrong. Perhaps now AOL can bring in some real editors and fact-checkers to straighten out this mess. TechCrunch gives blogging a bad name.

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