Brad Garlinghouse, who was previously an SVP at Yahoo, and the author of the now famous “Peanut Butter Manifesto,” is joining AOL as president of Internet and Mobile communications. What this means is that he’ll be responsibile for email, IM and other communications tools, which implicates a range of properties including Bebo.
According to the press release out this morning Garlinghouse will also be “heading up AOL’s Silicon Valley operations from its Mountain View campus and serving as the West Coast lead for AOL Ventures, the company`s venture capital arm headed globally by Jon Brod.”
AOL’s email, once dominant, is now number four after Gmail, Microsoft Hotmail and Yahoo Mail (in order). Garlinghouse oversaw Yahoo mail during his six-year tenure in Sunnyvale and was reportedly instrumental in the acquisitions of Oddpost (part of Yahoo Mail) and Flickr. However, his new position in Silicon Valley and with AOL Ventures indicates that Garlinghouse, who will report directly to AOL CEO Tim Armstrong, will have a more strategic role in the company.
Quoted in the NY Times, Garlinghouse says that AOL doesn’t have the kinds of problems that Yahoo did when he penned his Peanut Butter memo:
In an interview on Monday, Mr. Garlinghouse acknowledged that AOL also faced significant challenges, but suggested that it did not have the kinds of systemic problems that Yahoo was confronting in 2006.
“There is a clarity of vision and strategy,” he said.
AOL is often dismissed explicitly or implicitly by tech writers and bloggers as a company whose time has passed. However AOL remains the number four US Internet company with some category leading properties, such as MapQuest. It also is the top ad network according to comScore.
The question is how to reinvigorate the brand (depending on the property). That’s the chief problem with AOL Mail; it feels a little like driving an old car to many people: it works but it’s a little embarrassing. Indeed it’s not about functionality as much as the “@aol” address itself– and that may be a metaphor for the problem the company as a whole faces. Beyond this, there have also been lots of attempts to do new and interesting things with AOL IM over the past few years, to use it as a kind of platform but none of those have really taken hold.
As West Coast lead for AOL Ventures Garlinghouse may be tempted to grab hot new companies as a way to add sizzle and buzz to AOL. Yahoo suffered from that problem, as Garlinghouse pointed out in his “manifesto.” And AOL has made some problem acquisitions in the past. The poster child for ill-conceived acquisitions at AOL is Bebo, for which the company paid roughly $850 million. At the time AOL said “Together with its AIM and ICQ personal communications network, the acquisition will give AOL a premier position in the fast growing world of social media with a network of approximately 80 million unique users.” That didn’t exactly come to pass.
If there is in fact a “clarity of vision and strategy” at AOL any new acquisitions will need to clearly support that vision to be effective. There are opportunities for AOL in a range of categories but the company will need creative thinking and execution if it’s to capitalize on them. And while AOL has definitely assembled a strong team, that team has major work cut out for it.