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AOL Audience & Access Business To Function Separately By 2009

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.

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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