Blog Post

AOL Switches Strategy, Pulls Back On Possible Kids, Teens JV, Spinoff; SVP Malcolm Bird Leaves

You’re reading it here first … Last fall, we broke the news that AOL was looking for possible JV partners for a spinoff of its kids and teens businesses, KOL and Red. They had some inquiries and were exploring options. But that strategy isn’t part of the new AOL management team’s plans, a source at the company tells me “there has been a strategy shift” and the company has decided “kids and teens are core to our business.” They decided to reinvest in programming sans outside help. When I pointed out that the JV idea as explained at the time wasn’t meant to downplay Kids & Teens but to expand it, the source replied: “I think the point now is it’s one of those heritage points for us. We’ll keep it for ourselves and invest in it and grow it.”
Randy Falco replaced Jon Miller as CEO last December; as we’ve reported here, following that and a reorganization, a number of top executives left AOL. The ripple effects are still being felt. Last week, CFO Steve Swad announced his plans to move to the private equity sector. The latest departure is tied up in the change of strategy for kids and teens: Malcolm Bird, SVP- AOL Kids & Teens, is leaving at the end of March. No announcement yet about plans for a successor; Jacquie Moen, VP- AOL Kids & Teens, will manage in the interim. They report to Bill Wilson, EVP-programming.
Update: Since this posted, I’ve heard from multiple sources upset by the way the change in strategy was framed above. They say the budget for kids & teens was cut substantially and that the cut played a role in Bird’s departure. Back in the fall, the main reason for exploring the JV or private equity option to begin with was to finance programming and expansion across platforms. Add a cut in budget to the decision against that and it’s no wonder that Bird, considered quite marketable, is on the way out.
Related:
AOL Wants To Hook Up With JV or PE Partner To Spin Off Kids and Teens Biz