Why You Should Buy Aol Shares

Investing your money in AOL sounds about as shrewd and anachronistic as buying a VCR. This is a misconception. It's been just over five months since AOL's spin-off from the disastrous 2001 merger with Time Warner and the company is being rebuilt to thrive in the changing digital landscape. Led by its CEO Tim Armstrong, a former president of Google's Americas operations, AOL is now an advertising and content company with high ambitions.

The revamped company is hoping to thrive by tackling a problem facing advertisers and publishers alike: how to create real money, value and effect through the internet. The widespread problem stems from the fact most companies try to squeeze and reshape what worked offline into something that works online. This is wrong. Instead, they should be embracing the internet as an opportunity that necessitates completely new forms of content, marketing and advertising relationships. The kinds of things we've never seen before, not sites that are clearly awkward transpositions of paper to screen but things built specifically for today's and tomorrow's internet.

While AOL is playing its cards close, the company has made it clear it's working on doing just that. Unlike search and its obvious giants, there really isn't anyone using global scale to dominate the dynamic and emotional forms of online advertising that the web demands. This is because a lot of the material on Web 3.0 will require either intense, line blurring cooperation between content publishers and advertisers alike or companies like Youtube, Facebook or Hulu who have enough vision, clout and ingenuity to hammer out new models with their own brand of revenue streams. Alone, The New York Times can't revamp advertising just as Saatchi & Saatchi can't jump start new content. The problem has to be solved from both sides in the middle, together. And it will be, eventually. But AOL, with big, versatile assets in both advertising and content has the resources and diversity to create everything internally and beat its competitors to the punch.

If AOL can get that right and use its scale to dominate its competitors, AOL will be a soaring global brand once again and a stock you'll be happy you bought now.