{
  "docId": "019dd923-622b-71dc-a6d9-afa084f9cd73",
  "docSlug": "eb305b39ce19",
  "documentTitle": "AOL, Inc. (AOL)",
  "authorId": "03_Starboard_Value",
  "authorName": "Jeffrey C. Smith",
  "documentKindSlug": "activist-deck",
  "documentKindLabel": "Activist deck",
  "sourceTypeSlug": "activist_investor",
  "sourceTypeLabel": "Activist investor",
  "presentationDate": "2012-05-23 00:00:00",
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  "pageNumber": 44,
  "pageCount": 96,
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  "slideType": "villain_critique",
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  "density": "overcrowded",
  "nDataPoints": 8,
  "notes": "Uses a series of bulleted arguments to dismantle management's optimistic projections.",
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      "kind": "callout",
      "text": "We do not believe Patch is a viable business model.",
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      "kind": "list",
      "text": "We seriously question whether AOL is pushing ads to Patch that could otherwise be used on any other AOL property in an effort to inflate Patch revenue to justify continued investment.",
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      "text": "On the Q1 2012 earnings call, Tim Armstrong stated that he “hopes” AOL can achieve over $40 million of revenue at Patch in 2012. Even at that revenue level, we estimate Patch will still lose approximately $79 million to $133 million per year.",
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      "text": "Even at Patch’s targeted revenue model of selling 80% of ad slots to local advertisers, we estimate Patch would still lose between approximately $20 million and $60 million per year.",
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      "kind": "list",
      "text": "Further, how can profitability at Patch be achievable when: Only approximately 20% of ad placements on Patch are filled by local advertisers? 70% of local advertisers do not renew their contracts? National advertisers do not value Patch?",
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      "kind": "list",
      "text": "We do not believe Patch can achieve its recently committed goal of “run rate profitability by the end of 2013.” This optimistic outlook still results in Patch losing an approximately $150 million or more between now and the end of 2013.",
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      "kind": "paragraph",
      "text": "We do not believe the recent commitment to achieve profitability by the end of 2013 is realistic. We believe it is merely a tactic to attempt to gain support for Patch without any financial analysis to support it.",
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      "kind": "quote",
      "text": "On the Q1 2012 earnings call, Tim Armstrong stated that he “hopes” AOL can achieve over $40 million of revenue at Patch in 2012. — Tim Armstrong",
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      "kind": "source-note",
      "text": "Starboard Value estimates and supporting data sources.",
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      "kind": "title",
      "text": "A strategy of “hope” for Patch is not acceptable",
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      "name": "Cost Of Inaction",
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