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AOL fires top tier; taps Google officer

- The Washington Times - Friday, March 13, 2009

America Online sent Chairman and Chief Executive Officer Randy Falco packing Wednesday, along with President and Chief Operating Officer Ron Grant, replacing both with Google executive Tim Armstrong, the Northern Virginia company announced Thursday.

Analysts said the move could be a prelude to a spinoff or sale of the Internet pioneer, which still maintains a large presence in Sterling, Va.

Mr. Armstrong "is the right executive to move AOL into the next phase of its evolution," Time Warner CEO Jeff Bewkes said. "He'll also be helpful in helping Time Warner determine the optimal structure for AOL," he said.

Mr. Falco joined AOL in November 2006 from the NBC Universal Television Group, where he was president and chief operating officer. Mr. Grant, an AOL veteran, had been senior vice president for operations at Time Warner, AOL's parent company.

"It sure sounds like Time Warner is getting ready to unload this operation," said Gary H. Arlen, president of Bethesda consulting firm Arlen Communications, who has tracked AOL for more than 25 years.

"When the retrenchment reaches the executive ranks, you know it's the last stand for this company," Mr. Arlen told The Washington Times. "It pains me to say that. They were the training wheels of the Internet and ultimately created so many careers in the Web over the past couple of decades."

Mr. Arlen said the changes may not be enough to help AOL, which has seen its base of paid Internet subscribers plummet.

"Bringing an ad guy in says what's left of AOL is going to be an advertising vehicle and that's clearly not worked," Mr. Arlen said.

Mr. Armstrong, a member of Google's operating committee, started at Google in 2000 and opened the first office outside of the Internet titan's Mountain View, Calif., headquarters.

Before joining Google, Mr. Armstrong was a vice president of sales at Snowball.com and director of sales and marketing at Starwave's and Disney's ABC/ESPN Internet Ventures. He also co-founded a newspaper in Boston before joining International Data Group to launch its first consumer Internet magazine, "I-Way."