AOL Audience & Access Business To Function Separately By 2009

By Nikhil Pahwa ⋅ August 8, 2008 ⋅ Post a Comment

AOL is in the process of splitting their Access (ISP) from their Audience business; while the Access business isn’t of much consequence to India, the Audience business is significant - AOLs international operations are headquartered in India, based in Bangalore, and led by EVP (International) Maneesh Dhir, and its operations in India are audience focused.

Time Warner CEO Jeff Bewkes said during the Q2 earnings conference call that the Access and Audience business should be running separately in 2009: it’s a fairly complicated process and so far they have classified all of AOL’s assets and liabilities into three groups - Access, Audience, and a “Share Service Group” that will support both of the operating groups. They are also “finalizing operating agreements among these groups so that they can operate fairly flexibly.” But then why is AOL separating these businesses?

Says Bewkes “…we have the necessary flexibility to do something strategic with either of these businesses today.” This has fueled the notion that Time Warner is going to sell off either its Access or Audience businesses…or both. I suppose the “Shared Service Group” will be come defunct if and when that happens.

No India specific numbers, but AOL Ad revenues grew 2% to $530 million: Display advertising declined 14% to $191 Million (more units sold at lower CPM), Paid Search increased 10% to $172 million, while third-party network revenue grew 15% to $167 million. The Access business saw a subscriber decline of 604,000 subs during the quarter. AOL has 8.1 million US subscribers.

Note that Sify had modeled their business around AOL, and they restructured their operations last fiscal. Ever since, both their access business and audience business has been on the decline. Also worth noting is Google’s statement, that their investment of $1 Billion for 5% in AOL is “impaired”. (via ZDNet)

AOL launched their India portal last year, and Bewkes was in India earlier this year for the launch of Truveo.

Related:
– AOL To Bring Advertising.com To India
– Q1 Results: Sify Consumer Services Biz Continues Decline - Revenues 18% Down; Sify.com Relaunch In Q2

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AOL, Earnings, Earnings Call, Results


AOL To Bring Advertising.com To India

By Nikhil Pahwa ⋅ July 9, 2008 ⋅ 7 Comments

Exclusive: MediaNama has learned from multiple, reliable sources that AOL is in the process of launching its ad-network Advertising.com in India. The launch is expected to be in August or September. AOL India has declined to comment.

We’re told that the network will essentially aggregate India-specific inventory from a large number of international sites. AOL does have an ad sales team in India, led by Tarun Sobhani, but they’ve been focused, so far, on AOL.in. Advertising.com might also target Indian publishers with content-specific channels; one that we’ve heard about is a Bollywood focused channel. ABC - Astrology, Bollywood and Cricket - are the most popular categories of content in India.

AOLs International operations are headquartered in India, led by Maneesh Dhir (EVP International for AOL), and this, effectively, is the launch of Platform A in India, of which Advertising.com is a part. Given the increasing popularity of WAP in India, I wouldn’t be surprised if Third Screen Media also gets launched at some point in time. Readers should note that, last September, AOL had combined its advertising companies - Advertising.com (acquired for $435 Million in cash in 2004), Third Screen Media (acquired in May ‘07), TACODA (acquired July ‘07), Lightningcast and ADTECH - into a separate subsidiary called Platform A.

The launch of Advertising.com in India is significant - such a large player is likely to bring in resources into play, bring more advertisers and publishers into the fold, effectively help grow the Indian digital advertising market.

Current players in the Indian advertising network include Tyroo Media (in which Yahoo owns a significant minority stake), Komli (investment from Nexus India Capital, Helion Venture Partners and DFJ), Interactive Avenues (Sequoia Capital India), Ozone Media recently received around $4 Million (reportedly) in investment from IDG Ventures. Not sure of what’s happened to PayPod, though. From what we’ve heard, affiliate marketing network DGM India has been a significant success, and another affiliate network is being launched in the country. Update: The most dominant player - Google’s Adsense.

What’s interesting is that Advertising.com is entering the market at a time when vertical advertising networks are making their first appearance - Games2Win has recently launched a Game-portal specific network InviziAds, Ishir Digital is launching TonicTag, Goosefish Media Ventures (funding from Capital18) is launching at least two networks - DivaNation and GoSindbad.

Related: Hey Hey Platform A, How Much Money Did You Lose Today?

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Advertising, Advertising Networks


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