Here's Why AOL Never Spun Out Ad.com, Despite All The Rumors

Over coffee a couple months ago, a former AOL executive told us that Ned Brody, the CEO of what used to be called AOL's Advertising.com Group, once lobbied with AOL CEO Tim Armstrong for a spinoff from the larger company.

The idea makes some sense.

The Advertising.com Group, particularly the Ad.com ad network it is named after, has been growing much faster than the overall company.

Wall Street loves the kind of revenue growth its producing.

And it's not always clear that Ad.com's interests are precisely aligned with AOL's overall. AOL wants to be a company with lots of premium content brands, supported by big ticket ad sales. Ad.com tries to get great value for advertisers through programmatic buying.

But AOL never spun-out the Advertising.com Group or the Ad.com ad network within it. And then, earlier this week, AOL rebranded the group AOL Networks.

As a part of this rebranding, we got a chance to jump on the phone with Brody.

We used the opportunity to ask him why Ad.com – now AOL Networks – belongs inside the larger company, instead of on its own.

He gave us two reasons.

• "AOL has some of the most premium inventory in the marketplace. If you go out and ask re-targeters, the dirty secret is that all inventory doesn't perform the same. If you were doing a dynamic piece of creative, it's going to perform better on AOL. Having that asset in our inventory is a benefit."
• AOL inventory is Ad.com's guinea pig. AOL Networks is more than just Ad.com. The group also has a lot of ad tech in it like Pictela and…Ad Tech. Brody says that if AOL Networks were on its own, it would have a harder time finding out if new ad formats and technologies actually create value. "We're able to try new things in the way we monetize our assets and then we commercialize those efforts."