AOL terminates TechCrunch founder Mike Arrington; raises questions about strategy

AOL terminates TechCrunch founder Mike Arrington; raises questions about strategy

Summary: AOL dismisses TechCrunch founder Michael Arrington after news leaked that he was starting a venture capital fund to invest in companies he covers. Is this the kind of "bold move" Tim Armstrong meant to make?

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TOPICS: Start-Ups
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TechCrunch founder and Silicon Valley blowhard Michael Arrington was swiftly terminated (UPDATE: or not! Even AOL spokespeople don't seem to know) by parent company AOL yesterday after news emerged earlier this week that he was starting a venture capital fund to invest in startups.

The problem, of course, is that his influential blog writes about startups, putting Arrington in the crosshairs of every journalist's sacred compact: no conflicts of interest.

Arrington has been accused of pay-for-play coverage on TechCrunch before, and he's also pushed back against criticism from established members of the press by accusing them of having significant conflicts of interest that are acceptable only because they've disclosed them. (And you know what? He's right.)

The entire story is navel-gazing to the extreme, and I won't go on about the particulars. But what strikes me about this story is that AOL once again seems to lack control of its own company.

Arrington, of course, is no stranger to angel investing -- it's what he did long before he launched TechCrunch. And he has previously suggested that he would consider making new investments, before and after his website's acquisition by AOL in September 2010. Unsurprisingly, this violates AOL's (and any media company's) code of conduct policy.

But news of Arrington's new activities came swiftly this week. Even quicker was his dismissal by AOL, suggesting that the company is barely able to control its own properties. Arrington was considered a loud-mouthed beast to be tamed after news of the $30 million AOL acquisition broke; it turned out that it wasn't his words that put his parent company in hot water, but his actions.

It certainly doesn't help that Arrington named the $20 million fund after the website: the CrunchFund.

In the New York Times' report on the subject, AOL chief executive Tim Armstrong is quoted as saying, "TechCrunch is a different property and they have different standards."

Mr. Armstrong, that's no way to run a media company. And Arrington's quick release this week shows that it's no way to run a public relations strategy, either.

The whole thing shows that Armstrong and Arrington's supervisor, Huffington Post founder Arianna Huffington, were either unaware of Arrington's actions -- or deluded into thinking they would be acceptable by the industry, which for all of its faults tries to maintain a unified ethical front for authority's sake.

Say what you want about conflicts of interest (and please do in the TalkBack section below; I'm interested if readers care as much as the press do about such things), but the whole thing shows a real lack of leadership on AOL's part and casts doubt as to whether it can, financially or structurally, execute on its grand plan to be a reputable, lucrative content company. (That, in full disclosure, would compete with ZDNet's parent company, CBS Interactive.)

Are these the kinds of bold moves Armstrong and Huffington plan to make? Judging by the way this news leaked, it looks like there wasn't any plan at all.

Topic: Start-Ups

Andrew Nusca

About Andrew Nusca

Andrew Nusca is a former writer-editor for ZDNet and contributor to CNET. During his tenure, he was the editor of SmartPlanet, ZDNet's sister site about innovation.

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Talkback

14 comments
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  • RE: AOL terminates TechCrunch founder Mike Arrington; raises questions about strategy

    [leolaporte]Screw You Mike Arrington![/leolaporte]
    Digger_z
    • Message has been deleted.

      basvideoizle
      • Armstrong was not 'deluded', he was there with Arrington to announce ...

        @basvideoizle: ... ChrunchFund.

        So what we have here is all kinds of cowardice from this Armstrong guy who got afraid of "industry reaction".
        DDERSSS
  • RE: AOL terminates TechCrunch founder Mike Arrington; raises questions about strategy

    This news just brightened up my Friday. Mike Arrington is an arrogant...well you know. I'm surprised that TechCrunch is still around considering he was the one running it. The whole reason I never go to TechCrunch or believe anything on it was because of him. Glad to see him gone, good riddance.
    LoverockDavidson_-24231404894599612871915491754222
    • RE: AOL terminates TechCrunch founder Mike Arrington; raises questions about strategy

      @LoverockDavidson_

      +1 on that. Arrington is among the worst bloggers I have seen, OK, maybe SJVN comes close.
      mm71
  • RE: AOL terminates TechCrunch founder Mike Arrington; raises questions about strategy

    This is the same AOL that acquired ego-centric hypocrite Arianna Huffington. You know, the very one who bashes corporate greed then sells out to AOL for $300 million. She is laughable and so is AOL. But the bigger question is: does anybody give a da.mn about AOL anymore? Talk about a dinosaur.
    ryork272
    • RE: AOL terminates TechCrunch founder Mike Arrington; raises questions about strategy

      @ryork272

      That's what I'm screaming! Why/how AOL is even worth making news anymore is beyond me...
      WayneC369
  • Who can kill off AOL?

    Would someone put this pathetic company out of business already? This is getting so bad to read.
    jscott418-22447200638980614791982928182376
  • RE: AOL terminates TechCrunch founder Mike Arrington; raises questions about strategy

    AOL also owns Engadget. The two properties combined are nothing more than content shuffling blogs that aggregate stories from across the iNet but create very little original dialogue for the audience to consume and build from unless it's TechCrunch's undying butt worship of everything Google (www.youtube.com/watch?v=57LuqfbEVyU).AOL also owns Engadget. The two properties combined are nothing more than content shuffling blogs that aggregate stories from across the iNet but create very little original dialogue for the audience to consume and build from unless it's TechCrunch's undying, relentless butt worship of everything Google (www.youtube.com/watch?v=57LuqfbEVyU).
    trollCall
    • RE: AOL terminates TechCrunch founder Mike Arrington; raises questions about strategy

      @trollCall

      Is it just me or do I hear an echo???...
      WayneC369
      • RE: AOL terminates TechCrunch founder Mike Arrington; raises questions about strategy

        @WayneC369

        sure dude. That's what it is ...

        *crickets*
        trollCall
  • RE: AOL terminates TechCrunch founder Mike Arrington; raises questions about strategy

    It appears AOL's strategy is to buy credibility, then build on it and thus bring/create more value for its content. A character like Arrington and his VC fund would tarnish/corrupt the image AOL is ultimately trying to create. This was AOL's only choice other than move him to an advisory role. The biggest question is: is credible "content" a silo worth investing and building today? (Note the problem book publishers are having ? owning credible/vetted content whose price seems to drop every day.)
    Thinkin' & Blinkin'
  • RE: AOL terminates TechCrunch founder Mike Arrington; raises questions about strategy

    I'd never heard of TechCrunch before reading this article.
    Badge3832
  • RE: AOL terminates TechCrunch founder Mike Arrington; raises questions about strategy

    Since CBS & AOL joined forces, both have seemed to wander aimlessly in the tech world. After the blind move with the worthless Puffinton Post both continue their journey seeking some sort of recognition.

    Too big to fail? Seems the larger they become the more shallow their understanding of what they are actually doing. Another American Motors or failed bank in training.
    Bob Forsberg