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The Media Equation

No Longer Shackled by AOL

In 2005, Jim Bankoff was working at AOL as executive vice president in charge of products and programming. He decided that AOL needed to move aggressively into news if the business, then still a portal clinging to dial-up customers, was to survive the shift to broadband and the onslaught of new digital sites.

While he helped AOL build some new sites, including the fabulously successful TMZ, he was convinced that AOL needed to also acquire insurgent digital efforts built elsewhere. So he facilitated the purchase of Engadget, the technology site, along with Weblogs Inc. He hoped that the acquisitions would help a behemoth learn some new tricks from the start-ups.

If that story has a familiar ring, perhaps it’s because AOL just spent $315 million to buy The Huffington Post, the very successful news and aggregation site put together by Arianna Huffington.

There’s a lot of sudden cachet (and traffic) in buying what you cannot build, but as the Engadget example shows, there’s a problem with the strategy: Those nimble, adaptive businesses are sexy when bought, but they often end up as one more cog in the Borg.

Engadget’s relationship with AOL was always tense. A high-velocity site that competed for technology news with the likes of Gizmodo and CNET, Engadget never fit in with other AOL properties, largely middle-of-the-road, just-good-enough sites that didn’t bring a lot to the table.

Like many of its peers covering Silicon Valley, Engadget worked as a kind of permanent start-up, with 16-hour days to compete in the always-on news cycle, but AOL treated it as one more niche site. “We have been working on blogging technology that was developed in 2003, we haven’t made a hire since I started running the site, and I thought we could be more successful elsewhere,” said Joshua Topolsky, who was the editor of Engadget until the middle of last month.

So Mr. Topolsky and as many as eight of the more prominent editorial and technology staff members at Engadget have left or are leaving AOL and are about to build a new gadget site by joining forces with, yes, you guessed right, their old friend Mr. Bankoff, who now runs a federation of sports sites called SB Nation.

While there may still be a brand called Engadget at AOL, the people who made it a highly regarded site in a crowded category will be gone.

“We had done what we could with the resources that were given to us and taken it as far as it would go,” Mr. Topolsky said. “I know and trust Jim, and he gets what we do. After looking under the hood of what they have in terms of technology, we’re very excited about what we will be able to do there.”

In Internet years, AOL has grown long in the tooth and seems incapable of playing nice with the toys it buys. There is a great deal of execution risk in putting old and new brands together. Even now, many of the longtime editorial employees at AOL have been laid off to make way for Huffington Post staff, while many of the unpaid contributors to Huffington Post have been vocal about the fact that the site cashed in, but they still work free.

It hasn’t helped matters that AOL has changed strategies as often as Lady Gaga switches out sunglasses, including the much-hated “AOL Way,” a leaked document that suggested that the company was far more interested in mass-produced link-bait than building and supporting unique publishing brands.

Mr. Bankoff, who has spent 17 years in digital publishing, has lived the cycle of the joyous press release and the bold predictions and he has seen the ensuing culture clash up close.

“It is very difficult to build community or authority as a generalist or a portal,” he said. “I saw firsthand how talent can be squandered and enthusiasm deflated when people aren’t given the tools, trust or time to do their jobs.”

At first blush, SB Nation would seem to be an odd home for a gadget blog — the Venn diagram intersection between geeks and jocks usually is defined by the Madden NFL games. The site grew out of a group of fan sites, most centered on individual teams, that was first created by, among others, Markos Moulitsas, the political blogger who had a great deal of success with The Daily Kos.

Mr. Bankoff, who came on board in 2009, moved aggressively to expand both individual team sites and regional sites with $23.5 million in backing from Accel Partners, Khosla Ventures and Comcast Interactive Capital. SB Nation now has over 300 sports fan sites and just opened a national site called Baseball Nation, which includes Rob Neyer, a longtime baseball writer for ESPN.com. According to Quantcast, the site has more than doubled its traffic in the last year, to over 10 million unique visitors a month.

It’s a cluttered market, with ESPN.com, daily newspaper sites and even media from the teams themselves, but Mr. Bankoff likes building new sites without having to ask for the kind of permissions required at a big publicly held company.

“We have proprietary software that empowers talented editors and writers,” he said. “I have a history with these folks that leads to a conversation. They saw our process and technology and decided it was an environment that they would be able to succeed in.”

The company has focused on building a content management system that is simple and flexible, but can integrate the stats and videos that are so much a part of the sports narrative. SB Nation has developed so-called StoryStreams, which use real-time information to create articles that are organic and always changing, instead of merely updating old postings. It’s a capacity that will come in handy in covering technology news, which can arrive in fast and furious spurts.

The new gadget site may not fly, of course. But there is still a lesson here for AOL: while it’s nice to dine out on the latest shiny acquisition, you have to get down to the hard work of making sure it succeeds for the long haul. AOL has found a way to acquire what it cannot build, but it still hasn’t found a way to hang on to what it has.

E-mail: carr@nytimes.com;
twitter.com/carr2n

A version of this article appears in print on  , Section B, Page 1 of the New York edition with the headline: No Longer Shackled By AOL. Order Reprints | Today’s Paper | Subscribe

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