8 February 2011 - 1:31pm | posted by | 0 comments

After the Huffington Post deal who is going to be bought next?

After the Huffington Post deal who is going to be bought next?After the Huffington Post deal who is going to be bought next?

The Huffington Post deal has caused considerable speculation about what independent content-led sites are likely to be in the sights of acquisitive businesses like AOL.

And there is no doubt that the $315m Huffington Post deal will increase the valuation for other independent online companies that have managed to build traffic by harnessing the social media power of the likes of Twitter & Facebook.

The US have some prime candidates for takeover and these include:

Gawker Media, which has a collection of popular sites including its flagship technology blog Gizmodo, which attracts 19m monthly users.

Glam Media, a group of beauty and fashion sites aimed at women. It has around 88m users a month.

Business Insider, a business version of the Huffington Post which launched in the US a couple of years ago which attracts 3.5m users a month.

In the UK the pickings do not seem quite a rich. But there are some prime contenders such as:

Mashable, a technology blog which started in Aberdeen and has grown to become the world's largest social media site.

Digital Spy, which aggregates news and now has around 5m users a month.

The Daily Mash; the satirical site that has grown to become one of the UK's top 1,000 websites according to Alexa.com.

Explaining why content really might be a king maker as far as deals are concerned, analyst Ben Schachter told the New York Times: “Right now the macroeconmic turnaround and the explosive growth in mobile is causing internet companies to accelerate their investments, and there's a question of what is content. Companies like AOL and Yahoo are in a battle to make themselves relevant.”

But AOL are not alone in paying top dollar for content. In May Yahoo paid $90m for Associated Content, which claimed 16m users a month and CBS paid $1.8 billion for CNET News which attracts around 161 million users a month.

Huffington Post has around 25 million visitors a month and is growing. And although many believe the deal is a throw-back to the dot bomb days, other believe the price was fair.

Wrote Citigroup analyst Mark S. Mahaney: “Not cheap, but not outrageous for a relatively high-quality asset with strong top-line growth, current profitability and margin expansion potential.”

Said analyst Lou Kerner of Wedbush Securities: "Huffington Post is a pretty unique business in terms of scale and growth and the degree to which it gets social media and the way it deeply integrates it into the site.

"People should bow at the greatness of The Huffington Post for being able to guage their audience. It's worth a lot, but then again AOL could screw it all up."

But overall the deal does demonstrate that the value of good content is on the rise once again.
 

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