AOL CEO Tim Armstrong took the stage at Goldman Sachs' Communacopia conference and made a few headlines about his plans to create a next-generation digital content company.
He had two main messages: he's dumping unprofitable businesses and only pursuing profitable growth, and that content matters. Companies from Google to Facebook to Twitter are built around people finding, sharing and consuming content, so that's where AOL is placing its bet. And Armstrong thinks that the way people consume content will be increasingly brand driven. If you can use Google — or Google TV — to search all the video and articles out there, you'll increasingly rely on brands to curate your content.
Armstrong planted a couple key messages with investors in the audience. One, AOL's $100 million cap on acquisitions is expiring, which means they could start buying. Two, AOL has a video strategy in the works, which could be huge — he was incredibly secretive, an obvious way to stoke interest. Three, the Google dealwill be huge for AOL's revenue — Armstrong called it a "grand slam."
Armstrong defended AOL's investment in brand building and original web content, saying that the amount of money waiting to move into online advertising is underestimated. He pointed to AOL's success launching the new Jonas Brothers property—Cameo has been a huge hit, catapulting to the 3rd-highest ranked 'tween property in just one month. On the other end of the spectrum AOL is also launching branded entertainment for baby boomers, with a new Marlo Thomas web site that launched today.
Apple was also front and center — but instead of talking about the iPad as many of the folks at Communacopia have, Armstrong pushed the Apple TV. He gave an anecdote about his wife punishing his kids by banning them from watching Apple TV, forcing them to watch cable. His kids are obsessed with the Apple TV — but what that really means is that they want easily searchable content on demand. As web and TV content collide, we'll see if AOL can produce that must-see content.
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