The AOL Hudsucker Proxy

So some would say, that someone should make a movie about the last two years of AOL, sinceJon Miller was ousted...well they did...it's called the Hudsucker Proxy...

Miller would be Waring Hudsucker

Falco would be Sidney Mussburger

Grant would be Norville Barnes

The basic premise, Hudsucker who had led Hudsucker Industries to major success, dies (or is ousted), the company is taken over by a misplaced ruthless and faceless leader Sidney Mussburger, who's downfall, is an employee, Norville Barnes who rises in the empire even though he has no experience, and fails at everything he does.

"When Waring Hudsucker, head of hugely successful Hudsucker Industries, commits suicide, his board of directors, led by Sidney Mussberger, comes up with a brilliant plan to make a lot of money: appoint a moron to run the company. When the stock falls low enough, Sidney and friends can buy it up for pennies on the dollar, take over the company, and restore its fortunes. They choose idealistic Norville Barnes, who just started in the mail room. Norville is whacky enough to drive any company to ruin, but soon, tough reporter Amy Archer smells a rat and begins an undercover investigation of Hudsucker Industries."

Amazing coincidence, or is this all a plot? Someone get Oliver Stone on the Phone!!!!

AT&T sucks but can I give up the iPhone?

I have an iPhone...I ran out and got it three days after they came out, and yes it's sexy, it still makes me think it's the best phone out there but there's one problem, AT&T sucks!

With my iPhone I do the following on a regular basis:

1: Listen to music

2: Make calls (obviously)

3: Use the visual voice mail

4: Automatically synch my calendar with my laptop

5: Text messages

6: Check my stocks

7: Check the weather, (at the moment I track weather in 10 cities around the world)

8: Check Facebook

9: I have 28 "apps" on the phone, from games to Bloomberg finance

I0: I have thousands of photos on the phone, some from my laptop and most taken on the phone.

11: Surf the web

12: Watch TV shows

13: Check maps, especially in NY

14: Use the alarm

15: I keep notes

16:Synch my contacts with my laptop

What I don't do on the iPhone... watch You Tube videos, or mail, the mail sucks on the iPhone, I have a Blackberry just for that.

So can I give up the 16 above points to replace the crappy AT&T service?  I repeatedly get dropped calls, bad lines, late voice mails, or no service at all.  Verizon is much better in my opinion as a network.

I'm on the fence...I love my iPhone but is there a better option out there????

Is Apple the next big media company?

As many of you will know, I am a huge Applephile.  Have been ever since we got the very first Apple MacIntosh in the offices of "Coming Next Magazine" in Newcastle many many years ago.  Over the past ten years Apple has gone from a provider of high end computers to people in the graphics community, to being one of the strongest brands in the world.

Apple has transformed itself into a company that is responsible for delivering the majority of people their digital media. They still make amazing computers, but with the advent of the iPod they literally revolutionized the music industry, then providing TV on the iPod and movies, iTunes, Apple TV, and now delivering High Def programming and films for rent off iTunes, they are the conduit to everyone's digital future.

If you can deliver the goods, have a brand that people not only trust, but also covet, then why don't you start to make the content as well?  I believe that the company could become a media giant making, distributing, and owning content. They'll still have to distribute very else's content, but if Apple can package their goods so well, imagine how well they would package their programming.

Apple's ubiquitous presence in millions of peoples lives through computers, iPods, cell phones make them the most connected company out there. Other media companies have some elements, but Apples is the digital Valhalla!

Reflections of time past, the internet wins!

I am stealing this from Nick Carlson at Silicon Alley, but it really does tell the story...in one photo, newspapers are dead, long live the internet!

Tim A gives AOL a much needed boost!

Yesterday AOL new CEO Tim Armstrong gave AOL employees a much needed boost in the arm.  First of all, instead of sitting in NY to give his first speech, he did what he should have done and headed down to Dulles to meet the troops.  For the first time in a couple of years, I talked with people from AOL who were excited, and can see someone who truly wants to build this company.  It's the right thing to do... have a leader who understands the industry you're in.

It seems that the cheering is continuing, from the announcement of Rondy's departure to the arrival of Tim A. Tim has his work cut out for him, but hopefully understands the main thing about AOL, the staff are simply brilliant, and when motivated can do anything!

So how do you turn it around?

First of all AOL has depended on sales tools and technology plays for the pst couple of years, and abandoned targeted programming.  Misguided acquisitions like BEBO need to be re-structured to play to AOL's audience. By the way, does AOL know who it's audience is?  In order to get a targeted high CPM base they need to develop sustainable habitual programming that they can drive long term large advertiser deals with.  AOL has done this before, and it can do it again through some amazing destinations like AOL music, Finance, Black Voices, and of course KOL and RED, (if it still exists). 

The big problem is talent. After the departure of Jon Miller, all of the senior executives and business innovators left the company.  Tim will need to find replacements to re-build the value proposition, because in the past two years, I cannot remember a single programming play that seemed to work, (please correct me here).

The game is on, and this next chapter of AOL will literally be make or break. The good news is, I think EVERYONE is rooting for Tim Armstrong.

New boss at AOL already getting slammed

Not that I was a huge fan of the old regime at AOL, watching them tank the company in the past two years, and god knows Tim Armstrong has his work cut out for him, so you would imagine that someone would cut him a break.  Today, Henry Blodget from Alley Insider decided to kick the guy before he's through the door!!!

I have not met Tim before, but all I hear is he's a smart guy who gets this business. Compared to the previous management, Randy Falco and Ron Grant who had never worked in the space or run a company before, Tim can only be a breath of fresh air. Tim has been on a number of shortlists, Yahoo CEO for one, he has a proven track record at building revenues, and needs to have some support walking through the door.

Mickey kicks some Jonas Bros ass!

Ok so I am stealing this link from Nikki Finke but it's just so funny... Enjoy!

Mickey kicking the crap out of the Jonas Brothers

THis is Brilliant

Only the genius of Rick Adams can do this.

AOL the future

It's another depressing week at my old home in Dulles VA, as AOL lay's off a suspected 700+ employees.  It's a tough one.  AOL usually "purges" staff at the end of each year, only to hire people back the following year. It happened when I was there and seemed to almost be an annual event..but why?

AOL used to be the internet! Everyone used AOL to log onto the internet via a modem. Then the business model changed... people dropped dial up for faster DLS, mainly provided by the phone companies. Then the cable companies delivered broadband, now over fiber providing very high speeds.  AOL started to become redundant as an ISP, (internet service provider), so needed to switch it's business model from subscription basis to advertising.

Jon Miller, a friend of mine for 16 years was hired to run AOL in 2002 and charged with the "turn around", from a subscription to revenue building advertising model. Jon, who is one of the smartest people I know and a superb strategist, did this over a three year period, maintaining the return number to Time Warner and managing overhead costs.  By the time Jon left AOL, he and his team had grown advertising through a strategy of high profile targeted programming and in his final quarter alone advertising revenues had grown 45%.

When the new management came in, it seemed that almost through bitterness to the old regime, (definitely I was surprised at some comments publicly and privately made by new COO Ron Grant towards Jon and the old senior management), everything that had been built up was pulled down.  Targeted programming gone, network advertising as a strategy, junior management promoted to senior, (after the mass exodus by senior execs), and momentum seemed to fall apart.  More importantly than the momentum, revenue fell off the cliff.

I have made fun of before on this blog, of AOL's purchase of BEBO, a 3rd rate social network from the UK, predominantly used by kids in the UK.  They paid $850MM, which was $500MM more than I had been offered it for my SPAC fund only six months or so earlier. Decisions like this from the new AOL management seemed to everyone in the industry as insane... and now it seemed that everyone was right. 

So it does then look like AOL needs a reboot. It's always a horrible thing to do when you lay people off, but from a business point of view, if you are continuing to grow your business it's excused.. but, when you are tanking you business, and getting rid of personnel, people tend to look at the management and ask questions as to why they are still employed???

I think it's time to get a new management team in AOL, get a COO who has actually run a company before, a CEO who understands the business he is in, and at Time Warner real movement to sell AOL.

Here is the latest rumor mill

Thoughts

Is Network TV dead?

Network TV is in ICU and they're having to put all the fancy machines around the bed, including the one that goes "ping".

Remember when there was only network TV. CBS, NBC, ABC; they ruled the TV planet. It was, (and still is), the best form of advertising, they charged high CPM's against even higher audience figures. Then cable TV came in. OK, so Mr. Network man isn't too worried, a couple of kids channels, Sports channels well they'll never be able to afford the rights, Discovery... what's that? It must be a channel for people who go camping and wear burkinstocks! Ohhh yes they were still very bullish. Then digital cable came in and there were literally hundreds of channels, all putting programming out in niche areas, all diluting the overall viewer universe. Now of course we have the internet...game over for every network as we know it.

I applaud NBC and Fox or jumping into online TV video with HULU; and talk about a team of smart people getting it right out of the box, HULU really is great! But the internet, cheap cost of setting up a suite of digital channels, is eventually going to kill network TV.  So how will it work?

Well, I think the days of the $2MM per episode dramas are gone. I think the chances of getting high quality drama programming can only come when the unions understand that their future is linked to allowing networks more room, because budgets are only going one way and that's down. Network TV can make more money from reality TV, but the execs have to look at the quality  threshold as some reality TV is really bad digital cable standard. A show like survivor and amazing race is high quality entertainment, reality or not... a show like the Bachelor and Biggest Looser maybe isn't quite up to the standards but look at the ratings! Ben Silverman got it right when he said they're managing ROI not budgets, in other words screw a $2MM drama if I can make a reality show for $750K and get 75% of what the drama would make in advertising, but actually make a larger profit.

Then there is the after market...you can sell dramas all over the world, but reality shows are format sales with much less return.  If I had money now, I would be putting it on Internet video and not Network TV, which is exactly where the advertisers are going to go. So this is going to force the network CPM's down and then you're just a glorified digital channel with must carry status and a good position on the dial!