Sticky Situation of the Month: Ex-Yahoo Communications Head (and "Peanut Butter Manifesto" Scribe) Garlinghouse to Helm Similar Unit at AOL
In the ongoing game of musical chairs among top managers at Internet companies, former Yahoo exec Brad Garlinghouse–famous for his controversial “Peanut Butter Manifesto,” which correctly chided the Internet giant for becoming so lugubrious several years ago–is taking a job at AOL very similar to the one he left at Yahoo last year.
Garlinghouse, 38, has been named president of Internet and mobile communications at AOL, putting him in charge of the New York-based Time Warner (TWX) online unit’s powerful email and instant-messaging properties, including ICQ and AIM.
He has only been in talks with AOL–which used Spencer Stuart’s Internet-top-exec-finder-in-chief Jim Citrin–for a few weeks, in a deal that came together quickly, he and the company said.
Garlinghouse, a longtime Web entrepreneur and exec, had reportedly been considering a number of start-up and venture-related jobs since he left Yahoo last summer after six years there.
Sources said he was seriously considering becoming the CEO of a mobile firm.
He was most recently at Silver Lake Partners, as an “in-house senior advisor,” the private equity firm that recently bought the Skype Internet telephony firm for $1.9 billion. Garlinghouse also reportedly helped work on that deal.
“It’s really exciting to be to able to rebuild and revitalize an industry giant,” said Garlinghouse in an interview with BoomTown earlier today. “I make no bones that these [properties] are in need of that…but there is also a huge opportunity to do something cool.”
Garlinghouse has to hurry. Despite being among the top communications players online–a group that also includes Yahoo (YHOO) and Microsoft (MSFT) and, more recently, Google (GOOG)–AOL has lost relevance with key audiences, even as social networking properties like Facebook and the microblogging service, Twitter, have innovated in the communications space.
The hiring of Garlinghouse, well known in Silicon Valley circles, is meant to counter that.
He will head up AOL’s operations from its Mountain View, Calif., campus–which is also the former HQ of AOL-acquired Netscape Communications–where, said AOL CEO Tim Armstrong, Garlinghouse will “be CEO of Silicon Valley for us.”
Between all its various properties, AOL has several hundred employees in the Northern California area.
Armstrong said AOL–which was founded 25 years ago on the East Coast and has tried and failed many times to get a true foothold in the West–thinks having an important player at the center of the tech industry is critical as it moves to spin off as an independent company by the end of the year.
“We have a triple play in getting a great executive, who is a master in the communications on the Web and who is well known out there,” said Armstrong. “Brad is our senior AOL manager there.”
Along with running all of AOL’s communications properties, Garlinghouse will inherit some of its community properties, although AOL’s Bebo social networking unit–now considered to be an overpriced acquisition error–now resides in its ventures unit, headed by Jon Brod.
Garlinghouse will also be aiding Brod, said Armstrong, with AOL on the lookout for acquisition opportunities in communications and other arenas.
While Garlinghouse declined to be specific about what would pique his buying interest, he was responsible for such big Yahoo deals as its $350 million purchase of Zimbra in the fall of 2007.
He was also key to bringing both Oddpost, which is at the heart of Yahoo’s email offering, and the popular Flickr photosharing service to Yahoo.
Garlinghouse said he has admired what Twitter and Facebook have done, but that they were not destroying traditional online communications, pioneered by AOL, as some assert.
“It’s a vibrant segment and this just means there are a lot of opportunities to enable integration,” he said. “I think of it as an expansion of online communications and I hope AOL can do more collaboration and partnerships.”
Garlinghouse also has to watch AOL’s basic products like email, which was recently passed by Google’s Gmail as the No. 3 email service in the U.S. Yahoo Mail is the top email, while Microsoft’s Hotmail is second.
How much Garlinghouse can do will depend on the future financial strength of AOL. Its advertising business has been hit hard in the econalpyse, with hopes it will return before its money-generating access business continues its slow decline.
Armstrong is now in the midst of looking over AOL’s cost structure and employee base, which most expect will eventually result in another round of layoffs and cuts.
He has been busy creating a different strategy for the company since he arrived earlier this year, as well as hiring (and firing) top execs to create a new management structure.
Now, that includes Garlinghouse.
So, for a look-see at AOL’s latest talent acquisition, here’s a video interview I did with him, just after Yahoo bought Zimbra:
And here’s the full press release from AOL about the hiring of Garlinghouse:
AOL NAMES BRAD GARLINGHOUSE AS PRESIDENT, INTERNET AND MOBILE COMMUNICATIONS
NEW YORK, N.Y.–September 8, 2009–AOL today named Brad Garlinghouse as President of Internet and Mobile Communications, spearheading AOL’s global efforts to expand the reach of its e-mail and instant messaging. Garlinghouse will also take on an expanded leadership position for the company, heading up AOL’s Silicon Valley operations from its Mountain View campus and serving as the West Coast lead for AOL Ventures, the company’s venture capital arm headed globally by Jon Brod. Garlinghouse was most recently at Silver Lake Partners as an in-house Senior Advisor.
Prior to Silver Lake, Garlinghouse spent nearly six years at Yahoo!, where he led that company’s communications and community products. Garlinghouse will report directly to AOL’s Chairman and CEO Tim Armstrong.
” Brad Garlinghouse is an all-star in the Internet industry with an unparalleled background and proven track record, having led Yahoo’s communications products to unprecedented growth,” said Armstrong. “In addition to leading our efforts to grow our communications products, Brad will be bringing his global leadership and business experience as a key member of our company’s executive leadership team. He will also be a major force for AOL in Silicon Valley, working to expand our presence there and in the tech community in general. We’re delighted to have Brad on board and know he’ll do great things for AOL.”
“It’s a tremendous opportunity to join AOL at this pivotal moment in its history,” Garlinghouse said. “Tim has set out a clear strategy and vision for where he is taking this company as it becomes independent again. I’m looking forward to working with him and the rest of the team to realize that vision.”
Armstrong, who joined AOL in April, identified Communications as one of the five key areas of strategic focus for AOL after an extensive 100-day review of the company’s business. Other focus areas include Content, Advertising, Local & Mapping and AOL Ventures.
Garlinghouse spent nearly six years at Yahoo! where he most recently served as SVP of Communications and Communities. Prior to that he served as SVP of Communications, Communities and Front Doors, which included the Yahoo! home page. He came to Yahoo in 2003 as VP, Communication Products. During his time there, Yahoo! Mail went from No. 3 to leading all competitors by a wide margin, and the company’s instant messaging service rose to become the leader in that market as well. Garlinghouse also oversaw the company’s Flickr photo-sharing service and Yahoo! Groups.
Prior to Yahoo!, Garlinghouse was CEO of Dialpad.com Inc., responsible for all aspects of the company’s operations, finance, sales and marketing. He was also General Partner at @Ventures, Category Manager of Media Development for the @Home Network, Inc., and Manager at SBC Communications.
Garlinghouse, 38, received his BA in economics from the University of Kansas and his MBA from Harvard Business School.