MCN Blogs
Kim Voynar

By Kim Voynar

And … the AOL Axe Comes Down (Again), While Arianna Scoffs at Her Unpaid Writers

… to the tune of 900 employees laid off in the wake of the HuffPo buyout. I hate to play Nikki Finke and be all “Toldja!” but really, did anyone not see this coming?

I love how AOL CEO Tim Armstrong tries to play this down. He “lamented” the cuts and says AOL is “much more healthy” than it was a year ago. Aw, gee, you’re a prince, Tim. I’m sure those laid off employees feel so much better knowing you lament canning them. But I bet you don’t feel bad enough to take a bit of a pay cut off your multi-million dollar compensation package yourself to ensure the continued health of AOL, do you? Of course you don’t.

The 900 layoffs suck, but that’s not the full story here. Let’s go back to this CNN piece from October of last year and unravel this ball of yarn a bit, shall we?

So according to that piece, AOL has spent $530 million on acquisitions in the past year as it focuses on becoming a content company. Now why, you might ask, would a company the size of AOL, which already has a gazillion employees in place, and which already acquired Weblogs, Inc several years ago for what seems now to be the relatively cheap price of $25 million, need to spend another $500 million-plus acquiring MORE content companies? And what does it intend to do with them all?

Let’s take a look at a little timeline of some of the more pertinent acquisitions and layoffs, shall we?

May, 1999: AOL acquires Moviefone. Pricetag: $525,000,000 stock deal. Ka-ching.

June, 1999: AOL acquires Spinner (internet music site) and Nullsoft (music tech company) for a combined $400 million stock deal in a “pooling of interests.”

December 14, 2000: The FTC approves the merger of AOL and Time Warner for an astounding $111 billion. By late 2009, when the companies separate, according to this January, 2010 look-back by the NY Times:

The trail of despair in subsequent years included countless job losses, the decimation of retirement accounts, investigations by the Securities and Exchange Commission and the Justice Department, and countless executive upheavals. Today, the combined values of the companies, which have been separated, is about one-seventh of their worth on the day of the merger.


January, 2001: AOL/Time Warner cuts more than 2,000 jobs.

June, 2004: AOL buys out for $435 million in a cash deal, with the stated goal of strengthening AOLs position in the online advertising business.

October, 2005: AOL buys out Weblogs, Inc (and its Blogsmith software) in a relatively cheap $25 million deal, considering what they were getting. The Internets are abuzz with chatter about coming of respectability for bloggers and the Web 2.0 business model: Build it, grow it, sell it off.

May, 2007: AOL buys Third Screen Media, a mobile ad company, for an undisclosed amount. (Coincidentally — or not — around the same time, Microsoft acquires ScreenTonic SA, a a European mobile ad company.)

July, 2007: AOL acquires Tacoda, a leader in the “behavioral marketing” sector of online adverstising, in a reported $275 million deal, in a deal in which Tacoda will supposedly operate as a “wholly owned subsidary.”

October, 2007: AOL announces layoffs of 2,000 employees.

March, 2008: AOL aqcuires social networking site Bebo in a gargantuan $850 million cash deal. Holy crap. But didn’t you guys just fire 2,000 people a few months ago? Guess you had to pay for that somehow, eh?

April, 2008: AOL’s “Platform-A,” charged with the sizable task of integrating all of AOLs various interactive ad company acquisitions, announces it will layoff 100 staffers across its platforms in a plan to “eliminate redundancies.” Meanwhile, of 62 of the 97 Tacoda employees there when AOL bought the company have left voluntarily or been forced out.

August, 2008: VentureBeat reports that AOL will shutterer, we mean “expand” Tacoda, folding it into AOLs division; says it will still use Tacoda’s technology.

November, 2009: AOL CEO Tim Armstrong announces a plan to spend $200 million firing reducing AOL’s workforce by one-third, seeking 2,500 “volunteers” to put their heads on the chopping block.

January, 2010: Only 1,100 people decided to volunteer to be fired, so AOL starts pink-slipping those who didn’t volunteer in a round of layoffs affecting over 1,000 employees.

June, 2010: AOL unloads Bebo for “$10 million or less” to Criterion. Ouch. Guess that wasn’t such a smart acquisition, unless your goal was to destroy a growing social networking site and hand over that market to Facebook and Mark Zuckerberg.

September-October, 2010: AOL announces it plans to become a “content company,” starts by acquiring blog network TechCrunch (because Engadget wasn’t enough?), online video distrib 5Min Media, and social-media company Thing Labs (because that social media thing worked out really well for AOL with that Bebo deal …)

February 2011: AOL spends 40% of its cash on the $315 million HuffPo deal. Great deal for Arianna (not that she needed more money); not really good news for the people already working for AOL providing content.

March 2011: AOL announces it’s cutting 900 more jobs in the wake of the HuffPo buyout. Like we didn’t see THAT coming.

Now, here’s the real money in that Cnet piece on the most recent round of AOL layoffs:

In the acquisition, AOL took on the publication’s staffers, leading AOL to make room by laying off some of its employees. Even so, the company’s editorial department will grow by a net of 17 people, thanks to the influx of Huffington Post employees, according to the spokesperson.

Looking ahead, AOL plans on expanding its editorial staff, the spokesperson said. However, in doing so, it will start moving away from a reliance on freelance journalists and hire more in-house editorial employees.

In other words, yes, AOL staffers took a hit with the merger, but we’re going to pretend they didn’t and call “evensies” by counting the influx of HuffPo staffers as a gain. And, moreover, AOL plans to move away from using freelancers and use more “in-house editorial employees.” You know why? Because they can pay someone $2,000 or so a month to be “editor” of a site — meaning they don’t have to also pay that person per-post — and then make the editorial staff bang out a bunch of the posts that they used to pay freelancers for at about $10 a post for short newsy bits and $50 a post for features.

In other words, they know the editorial staffers who aren’t getting the axe this time around fear for their jobs, and the job market for writing sucks. So they’ll play on that fear to get MORE work out of those people without paying them MORE money, while also cutting a bunch of freelance writers out of already skimpy paychecks. Nice, guys.

By the way, if you’re curious what AOL CEO Tim Armstrong rakes in, while he’s busy laying off other people from their jobs? His deal with AOL nets him a minimum annual base salary of $1 million, plus a “discretionary cash bonus” with a target amount of $2 million and a ceiling of $4 million. How’s that stack up against what the writers and editors working their asses off providing the content that’s building the “new AOL” get compensated?

Meanwhile, HuffPo’s legion of UNPAID WRITERS ponder the possibility of a strike, while Queen Bee-yatch Arianna Huffington, displaying what should be considered a shocking amount of arrogance (even for her), has this to say about HuffPo’s UNPAID WRITERS striking:

“She argued that blogging on the Huffington Post is equivalent to going on Rachel Maddow, Jon Stewart or the “Today” show to promote their ideas.

And, she said, there are plenty of people willing to take their place if they do.

“The idea of going on strike when no one really notices,” Huffington said. “Go ahead, go on strike.”

Wow. Let them eat cake, eh? Fuck you very much, Ariannna. And the $315 million sale you just rode in on.

Listen up, HuffPo writers — and all you AOL bloggers who are still (at the moment) getting paid to write. You writers over there need to unite against this bullshit. Seriously, what in God’s name are you thinking, working for this woman for FREE? You are contributing to Arianna Huffington being a super-rich slavemaster by voluntarily being her slaves. You are being exploited of your own free will, and only your own free will can stop it.

And any writers out there who think it would be a good idea to step in and fill in the gaps if the legion of HuffPo’s UNPAID WRITERS do go on strike better think again. Do you really want to allow yourselves to continue to be exploited for Tim Armstrong’s and Arianna Huffington’s gain?

Be Sociable, Share!

4 Responses to “And … the AOL Axe Comes Down (Again), While Arianna Scoffs at Her Unpaid Writers”

  1. John says:

    I work for a company that was just bought by another company and when it comes to profit goals, they list in their powerpoint to all the managers one step will be by cutting jobs. Heck, they gave everyone a pay cut to make the stock more valuable so the CEO could get his $10 million merger bonus once the deal was done. These people who make all this money, where do they think it come from? It comes from the backs of the workers whose pay they cut and jobs they eliminate.

    Arianna’s proven to be just as soulless as the Goldman Sachs vampires she criticizes.

  2. Belinda Gomez says:

    No one reads the bulk of the HuffPo free bloggers. They don’t break news, they don’t get linked by bigger outfits, they’re just echoing themselves. Sad but true. On the other hand, they can claim to write for Huff Po.

  3. Kim Voynar says:

    Belinda, if those free bloggers weren’t offering something of value to HuffPo, you can bet Arianna wouldn’t be wasting her time and website running their stories. Those free words help flesh out the site and have helped create a property that Arianna just sold for $315 million.

    That’s what’s sad but true.

  4. Shane013a says:

    Why are you using such talent to make some lame bi*ch richer than she already is and prove that she can control anyone she desires!?!?


Quote Unquotesee all »

It shows how out of it I was in trying to be in it, acknowledging that I was out of it to myself, and then thinking, “Okay, how do I stop being out of it? Well, I get some legitimate illogical narrative ideas” — some novel, you know?

So I decided on three writers that I might be able to option their material and get some producer, or myself as producer, and then get some writer to do a screenplay on it, and maybe make a movie.

And so the three projects were “Do Androids Dream of Electric Sheep,” “Naked Lunch” and a collection of Bukowski. Which, in 1975, forget it — I mean, that was nuts. Hollywood would not touch any of that, but I was looking for something commercial, and I thought that all of these things were coming.

There would be no Blade Runner if there was no Ray Bradbury. I couldn’t find Philip K. Dick. His agent didn’t even know where he was. And so I gave up.

I was walking down the street and I ran into Bradbury — he directed a play that I was going to do as an actor, so we know each other, but he yelled “hi” — and I’d forgot who he was.

So at my girlfriend Barbara Hershey’s urging — I was with her at that moment — she said, “Talk to him! That guy really wants to talk to you,” and I said “No, fuck him,” and keep walking.

But then I did, and then I realized who it was, and I thought, “Wait, he’s in that realm, maybe he knows Philip K. Dick.” I said, “You know a guy named—” “Yeah, sure — you want his phone number?”

My friend paid my rent for a year while I wrote, because it turned out we couldn’t get a writer. My friends kept on me about, well, if you can’t get a writer, then you write.”
~ Hampton Fancher

“That was the most disappointing thing to me in how this thing was played. Is that I’m on the phone with you now, after all that’s been said, and the fundamental distinction between what James is dealing with in these other cases is not actually brought to the fore. The fundamental difference is that James Franco didn’t seek to use his position to have sex with anyone. There’s not a case of that. He wasn’t using his position or status to try to solicit a sexual favor from anyone. If he had — if that were what the accusation involved — the show would not have gone on. We would have folded up shop and we would have not completed the show. Because then it would have been the same as Harvey Weinstein, or Les Moonves, or any of these cases that are fundamental to this new paradigm. Did you not notice that? Why did you not notice that? Is that not something notable to say, journalistically? Because nobody could find the voice to say it. I’m not just being rhetorical. Why is it that you and the other critics, none of you could find the voice to say, “You know, it’s not this, it’s that”? Because — let me go on and speak further to this. If you go back to the L.A. Times piece, that’s what it lacked. That’s what they were not able to deliver. The one example in the five that involved an issue of a sexual act was between James and a woman he was dating, who he was not working with. There was no professional dynamic in any capacity.

~ David Simon