As analysts digest AOL's surprise $315 million purchase of The Huffington Post, they are collectively reconsidering the initial "win-win" verdict. AOL's stock has dropped since the announcement, and at least one prominent AOL blogger, conservative Matt Lewis, jumped ship, warning that "AOL has vastly underestimated the public perception" that HuffPo is an "overtly left-of-center (sometimes activist) outlet." Did AOL make a big mistake? (Watch an AP report about the deal)
The math just doesn't add up: AOL's purchase of The Huffington Post is "not necessarily the train wreck that AOL/Time Warner was," says Megan McArdle in The Atlantic. But the odds are that the only real winners will be HuffPo investors. Mergers are expensive, and in this case combining the two companies seems riskier and less valuable than a simpler, cheaper content-sharing partnership would have been.
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