One of the tech realm's most popular blogs is about to go to AOL (NYSE: AOL) in a hand basket.
Michael Arrington's TechCrunch is confirming this afternoon that it will be acquired by AOL. GigaOm broke the rumor last night, and since the usually chatty TechCrunch was mum on the report, it was easy to assume that it was accurate.
I'm not the only Fool who reads TechCrunch religiously. A search through our archives finds 140 different articles that refer to a news story initially broken by Arrington's site. TechCrunch will look good on AOL's noodle of an arm, as long as the undisclosed terms are right. TechCrunch won't come cheap, and neither will Arrington and his staff of seasoned writers.
As most major Internet powers strive to generate inexpensive content, this deal bucks the trend:
- Yahoo! (Nasdaq: YHOO) acquired Associated Content, a site with 380,000 freelance contributors who get paid as little as $2 for any of the 50,000 monthly articles that get cranked out.
- AOL is trying to create hyperlocal news content on the cheap through Seed.com and Patch.com.
- Google (Nasdaq: GOOG) has replaced small paychecks with the eventual potential of ad-sharing revenue on YouTube, Blogger, and Knol.
Fully stocked with free and cheap content, the portals are now turning to established sites that draw large audiences with attractive demographic attributes.
Opportunistic investors looking to cash in on the new trend may be out of luck with privately held TechCrunch, but there are a few public possibilities. TheStreet.com (Nasdaq: TSCM) has run into a rough patch of quarterly deficits lately, but it's a logical acquisition target. WebMD (Nasdaq: WBMD) -- at least as a consumer-facing portal -- is a trusted source of health-related content.
Quality content is on the acquisitive menu again. Whatever happens between AOL and TechCrunch, investors should come hungry.
Who do you think will be the next dot-com buyout? Post your thoughts in the comment box below.
