Pure Adsense Site Sold for $20-$35 Million To AOL

[markus007]

Paidcontent.org is reporting that Weblogs Inc is selling for 20-35 million to AOL. The site is making a million and some purely off Adsense per year.

[jimilives]

While no actual number is made I assure you aol didnt buy this in hopes of being the worlds best adsensor, obviously they would replace the google adwords with thier own advertisement. Assuming that they look at the gross sales of revenue on the site (what google makes not the publisher) then you can roughly figure double the reported 2 mill that the publisher has been quoted as saying, so for 20 mill they buy a site that is giving them 4mill worth of advertising space per year, with a life expectancy of far more then 5 years I think this deal says little about adsense or its standing in the content advertising community and more about aol's long term planning when it comes to general advertising structuring.

[Alioc]

Wow! It deserves that money. AOL would increase the traffic & profits and get the invested money back within a couple of years for sure. Good investment.

The question is, will AOL keep the Google ads when the acquisition is complete.

[novice]

The question is, will AOL keep the Google ads when the acquisition is complete.

I quess that would depend on who buys AOL, Google or Microsoft.

[Jenstar]

For the record, it wasn't "pure AdSense". They had plenty of other paid advertising, and many of the blogs made more from those ads than from AdSense.

[Alioc]

Comment by Jason Calacanis:

Another thing to keep in mind is that we can’t run Google Adsense in top positions on a lot of our blogs because they are sold out (Engadget, Autoblog, etc. are sold out up top). If we had those slots open we would be at much more per day right now.

[markus007]

Reuters said they have it on good source that the deal is for $25 million with an earnout that could get it up to $40 million.

Damn.....

[JoaoJose]

25 million is way too much for a company that for all I know barely makes a profit. Three months ago Calcanis wrote on his blog that they were almost reaching 1 million/year from adsense but that wasn't enough to pay +100 bloggers and 9 other "unproductive" employees. So why would someone throw 25 million out the window? Maybe there's something we don't know....

[Zygoot]

25 million is way too much for a company that for all I know barely makes a profit. Three months ago Calcanis wrote on his blog that they were almost reaching 1 million/year from adsense but that wasn't enough to pay +100 bloggers and 9 other "unproductive" employees. So why would someone throw 25 million out the window? Maybe there's something we don't know....

They were making lots of profit I guess.

Don't forget they don't solely use AdSense.

[JoaoJose]

Even if they make 1 million more in other forms of advertising 25 million is too much I think. But hey!I'm actually very happy for them, it's amazing how in just two years they've achieved so much popularity.

[mike schmitz]

Zygoot, you don't buy websites solely on profit. If you are AOL, you buy anything that bolsters the product value, user experience or profit of your entire business. When they bought ICQ, ICQ was losing money. That turned out to be a big brick of IM users.

[JoaoJose]

Yes Mike, I think that's why they're putting so much money on this.

On the other hand I don't know if this kind of company will be able to retain it's value (i.e. the bloggers) after being absorved by such a large corporation.

[hyperkik]

It's possible that they don't much care about the bloggers - they have phenomenal amounts of proprietary content through Time/Warner. It's also possible that they expect the bloggers to stay and expect to expand on the number of bloggers involved, in the manner of the New York Times/About.com merger. There are a lot of possibilities.

[mhhfive]

yeah, Weblogs inc said its AdSense revenue was like $1+ million annual, and that its total ad revenue was like $2million ... so AdSense was a little over half of its earnings. Still, $25 million seems crazy...

[freeflight2]

a bunch of social networking / blogging / "Web 2.0" sites are valued at $20 - $60M - which makes sense if they have a strong following/community.

[seunosewa]

I don't see why AOL will want to buy Weblogs Inc when they could easily hire their own bloggers and launch a similar company. Is there way to confirm this information?

[JoaoJose]

a bunch of social networking / blogging / "Web 2.0" sites are valued at $20 - $60M - which makes sense if they have a strong following/community.

It makes sense if you can monetize that community. Is AOL able the squeeze enough money from weblogs inc to pay the
25 million price tag?

[JoaoJose]

I don't see why AOL will want to buy Weblogs Inc when they could easily hire their own bloggers and launch a similar company. Is there way to confirm this information?

check out calcanis blog for confirmation :)

[RonS]

I sure hope they drop AdSense... it'll leave more inventory for the rest of us! :)

[cagey1]

Blogs - Internet Bubble II - The Eyeballs Return

[Brett_Tabke]

continued over here:
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