Google’s algorithm change causes AOL share to drop

Posted on March 8, 2011

 

Just as Google unleashed its latest broadside on ‘content farmers’ by carrying out a major overhaul to its search algorithm, an unholy alliance between two proponents of this sinister art was given a blessing by the U.S Federal Trade Commission.

Content aggregator and blog The Huffington Post was acquired by America Online (AOL) for £193 million ($315 million), and the deal was announced soon after the American Super Bowl on 6th February.

The reaction to this deal by investors was poor, and AOL’s shares dipped by 5 per cent after the announcement. Industry commentators have put this down to the Huffington Post’s huge price tag, and a wobble in Wall Street confidence in its business model.

Reputable search engine optimization experts have long evangelized about the need to ascend through Google’s ranking pages by ‘white hat’ means. That is, by building links naturally, publishing regular, relevant content and striving to be seen as an authority in your chosen field. However, there is always a flip side. Some SEO jobs consist of purchasing links from ‘link farms’, and publishing content that proves to be attractive to web crawlers but bears no relevance to searchers.
The reason the Wall Street investors may have had a dip in confidence in AOL is down to the business model of publishers of that ilk – namely, producing content with the emphasis and ‘fast and cheap’ as opposed to ‘quality’. This can propel a site through the rankings, but sooner or later, a site will be punished by Google , just as JC Penney was after its recent link farming bust, and so any hard work and money spent will be all for nothing.

It seems that with Google showing that it means business with those employing underhanded SEO techniques, investors are fearful that something similar may happen to AOL. It remains to be seen how Arianna Huffington, the founder of the Huffington Post, will be able to apply her talents to AOL.

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5 Comments »

  1. As a driving instructor I taught myself website design and SEO through necessity. My site now ranks number 1 on google for a number of search terms. It has taken a long time for me to learn those skills and to optimise the website. I’m soooo glad a used white hat techniques and glad too that the scamsters are finally getting their comeuppance.

    Comment by Newbury Driving School — March 8, 2011 @ 7:10 pm

  2. Face it, the shares dropped because a left-leaning entity wasted $315 million on purchasing an even further left hack of a blog/website. America is sick of the continued movement to the left by the out-of-touch elites against the majority of its citizens.

    Comment by Joe Davis — March 9, 2011 @ 4:10 am

  3. Will this affect links on blog posts?

    Comment by Sam — March 9, 2011 @ 5:17 am

  4. Clearly there is going to be a lot of fall out from Google’s algo change. What we do know though is that companies such as AOL who have the financial resources available will buy their way out of the black hole.

    As I write I’m sure that AOL has some of their talent aimed at resolving these issues. For AOL it is a temporary blip. What is shows the rest of us is that relying on Google for your business is a dangerous game. I’m sure that Google has seen a big increase in Adwords subscribers since the change, many businesses will now be paying to replace their generic search position with paid placement in Adwords.

    Comment by Restaurant Booking System — March 9, 2011 @ 9:04 am

  5. Interesting article that reinforces the reality that good content always count. I appreciate your ability to weave together market forces here to bubble up the connections.

    Comment by Vanessa DiMauro — March 9, 2011 @ 12:09 pm

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