CEO Tim Armstrong, Arianna Huffington Reveal AOL’s Ambitious Hollywood Strategy

 Jeff Lipsky

In a similar bid to lure eyeballs and ad money, rivals MSN and Yahoo have also done their share of webisodes. Where AOL differs from its portal competition is its particular interest in stars. MSN has instead focused on partnerships with Gail Berman and Braun's BermanBraun on content sites like Wonderwall and original video series from outlets like Next New Networks. Yahoo, which garners nearly two-thirds more monthly users as AOL, has been busy growing its roster of Web shows from such production companies as Electus and Reveille.

Arianna Huffington (Getty)

Google, too, made headlines in February when New York Magazine's Vulture blog reported that YouTube was courting celebrities in its push toward professionally produced content. Once the domain of user-generated cat-on-a-skateboard videos, the site's strategy was to create about 20 celebrity-branded channels featuring a host of original three-minute shows. (Sources familiar with the company's plans say the strategy is not as celebrity-focused as the report suggested and that the reported $5 million budget was overstated.)

Clift dismisses the competition, arguing that AOL's advantage is its "maniacal focus" on content. "This is the only thing that this company does," she says, echoing her boss' content, content, content rallying cry.

Now, perhaps poignantly, the Huffington acquisition not only could inject some cachet into the tired Web brand but also give AOL its first definable identity in ages.

Critics in the media called the acquisition the equivalent of a Hail Mary pass. To them, Armstrong says, "Hail Marys are for people who don't have a plan; we have a plan ... and we're executing as quickly as almost any company in our space." Continuing with the football metaphor, he calls the HuffPo deal a "first down," arguing that the company is marching the ball down the field.

HuffPo -- or more specifically, HuffPo's model -- hasn't been immune to criticism, either. Since the deal was announced, many of its unpaid bloggers have come forward to blast its pay structure. A Facebook group titled "Hey Arianna, Can You Spare a Dime?" was launched as a destination for disgruntled writers to voice their frustration, while still other outlets likened Huffington to a new-media slave driver. (HuffPo does pay an editorial staff of nearly 150.)

Huffington, who will assume control over all AOL content, including Hollywood projects, once the deal is finalized, is frustrated by the attack. "I don't just find them wrong, I find them truly offensive because I feel that slave-driving and sweatshops are real problems in the world, and to make any comparisons like that is self-indulgent and childish," she says from her home in Los Angeles. "We're providing a platform for those who want to use it; nobody has to use it."

Fittingly, in the Huffington Post's six-year history, that platform has proved particularly appealing for a creative community looking to control its message. When Rob Lowe wanted to get out in front of a media storm that a family lawsuit would cause in spring 2008, he turned to her site to not only break the news on his terms but also present his side of the story. Two years earlier, Huffington's friend and agent Ari Emanuel used it to articulate his concerns about Mel Gibson's anti-Semitic rant, ultimately changing the conversation -- and Gibson's career prospects. More recently, George Clooney and Sean Penn have turned to Huffington's site to push their social causes. (Like the fuming bloggers on Facebook, none of them is paid.)

After reeling off an impressive list of past and present contributors to her site, including Larry David, Nora Ephron, Bill Maher and Alec Baldwin, she says, "Hollywood has always been part of Huffington Post's DNA." But that thought is interrupted when her phone rings. On the other end, the PR director for fashion house Ports 1961 - and yes, a HuffPo blogger - is checking to see if she had chosen a gown for Oscar night's festivities. On her agenda: the ultra-exclusive Vanity Fair party, where she was set to join her new boss in the company of dozens of new, potential partners.

Georg Szalai contributed to this report.

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