PRISM is real. Even the U.S. government now acknowledges its existence. The question that remains unanswered, though, is how involved Google, Apple, Yahoo, AOL, Paltalk and Facebook were. These companies are all named as “providers” on the original slides, including the dates the NSA started collecting data from them. The reporter with the most direct access to these documents, Glenn Greenwald, has also now repeatedly stated that the NSA had “direct access” to these company’s servers or seized this data from them.

According to Greenwald, NSA agents even have real-time access to conversations and chats on Skype, Gmail and other platforms that are being targeted. We contacted every single one of the companies implicated on these slides, though, and all of them either denied having ever heard of the program and virtually all of them claim that they would never give any government “direct access” to their servers. The one line virtually all of them use is some variation of “we do not provide the government with direct access to our servers.” They all, however, say that they comply with court orders after scrutinizing the request.

So we’re at an impasse here. The government acknowledges that PRISM exists, but the companies that are supposedly involved all say they’ve never heard of it. Greenwald says they are either giving the government direct access or the government simply seized the data from them.

If these companies aren’t giving the government direct access, could they give it “indirect access?” That way, the statements remain technically valid. Assuming these companies knew about the program, they obviously wouldn’t be allowed to talk about it anyway.

One suggestion I’ve seen floating around is that all Facebook, Google, Microsoft and Co. would have to do is give the government access to their networks and let the NSA copy all of this data. Or they could send their users’ data to the NSA, too, but given that the leak seems to imply real-time access, that seems unlikely.

The way things stand right now, it seems the NSA has deals in place with these companies — deals they can’t talk about — that allow the government to tap into their traffic (maybe at a large exchange point) and route it through one of the NSA’s massive data centers for storage and analysis.

If everybody but the U.S. government is denying knowledge of this program, something is clearly wrong. There are still 37 pages of this 41 page presentation that haven’t leaked. Hopefully we get to see those in the near future, and maybe that’ll shed some light on these tech companies’ exact roles in this program.

Update: The Washington Post, which also reported on this story independently from the Guardian, has now added the following to its report:

It is possible that the conflict between the PRISM slides and the company spokesmen is the result of imprecision on the part of the NSA author. In another classified report obtained by The Post, the arrangement is described as allowing “collection managers [to send] content tasking instructions directly to equipment installed at company-controlled locations,” rather than directly to company servers.

This lends credence to the idea that the data collection was indeed done “indirectly” without direct access to the companies’ servers (but still with their knowledge).

AOL (owner of TechCrunch) has just reported its Q1 results for the quarter, and it’s a mixed bag, with sales of $539 million, up 2%, beating Wall Street estimates, with diluted earnings per share coming in at $0.32. Analysts were expecting revenues of $537.15 million, with First Call’s EPS estimate of EPS at $0.32. Still, Q1′s EPS number is up 45% on the same period a year ago. Net income was up 23% to $25.9 million.

Here’s how revenues and profit break down over the last several quarters:

This quarter, it looks like AOL’s global display revenues are finally in an upswing, rising 8% over a year ago to $140 million. Subscription revenues, the legacy part of AOL’s business that still includes (yes) revenues from dial-up customers, is still coming in as a bigger part of AOL’s revenues, at $165.8 million. They are slowly on the decline, though, down 9% on a year ago.

Last quarter was a notable one for AOL in that it was the first one in eight years where the company had posted revenue growth, with revenues of $600 million for the three-month period. As with many other online, advertising-based companies, AOL’s revenues for this most recent, post-holiday quarter will be seasonally lower.

More interestingly, the company has been working to reposition itself around a couple of key strengths where it can still gain ground, even as Google continues to dominate the online advertising market overall. As eMarketer notes, in AOL’s biggest market, the U.S., its share of online ad spend is in decline, with AOL’s share expected to be 2.3% this year compared to 2.5% in 2012, with Facebook and Google particularly gaining in the display sector where AOL makes most of its revenue. Total display ad spend in the U.S. is projected to be $17.7 billion this year, with AOL taking 3.1% of that, with Google and Facebook taking 17.6% and 15.5% respectively. In this regard, for AOL to make its position as strong as possible in the couple of areas where it can still grow.

The first of these involves innovations around ad tech. That has included grouping together all of the company’s online advertising sales and technology assets into a single group, AOL Networks. And last week the strategy got another boost when AOL signed a deal with FreeWheel and Mediaocean so that AOL’s online inventory, and specifically its video inventory, can be bundled together with TV ad buys in a multiscreen strategy.

The second is a stronger emphasis on rich-media advertising, specifically against premium content that AOL owns itself or has deals to provide advertising for. AOL’s portfolio got a boost early in the quarter with the acquisition of gdgt, started by two former Engadgeteers (founder Peter Rojas and ex-editor-in-chief Ryan Block).

And last week, AOL expanded the amount of content against which it can sell online ads even further with the news that it would be releasing 15 new original video programs, created in a factual, unscripted format that fits with the rest of AOL’s newsy portfolio. However, as it grows in these areas, it’s also continuing to whittle down assets in others, such as its nearly-concurrent decision to shut down AOL Music.

AOL’s own branded content is still lagging behind the company’s subscription revenues (again, these relate mainly to the company’s legacy services) but they are also showing the strongest growth in terms of revenues over a year ago. But if you look at operating income before depreciation and amortization, collectively the Brand Group, along with AOL Networks, are still loss-making, if coming very close to break-even:

The third-party advertising business continues to grow for AOL. This quarter revenues for ads distributed on sites not owned by AOL were up 10% to $120.7 million.

Fortune reported earlier today that Mike Brown Jr. and much of the team that ran AOL’s venture funding arm have formed their own VC firm — Bowery Capital — that aims to find and fund enterprise-friendly startups. While it’s somewhat heartening to see a new firm set up shop in New York City, there’s another weighty question here that hasn’t been answered yet: now that nearly all of its staff has spun off a new venture fund, what’s going to happen to AOL Ventures?

Well, long story short, it’s not going anywhere yet. I spoke to Bowery Capital founder Mike Brown today, and he confirmed that AOL Ventures’ other co-founder/partner Jon Brod would continue to run the show now that Brown is off managing a fund of his own. According to a reputable source with knowledge of the situation, AOL has no plans to give up on its early-stage investment activities, but it’s next step isn’t exactly clear. While that source said that under CEO Tim Armstrong’s leadership AOL would remain connected to the startup world, there’s no firm plan in place for how the company’s venture arm will proceed from here.

Meanwhile, an AOL representative provided the following statement:

“AOL Ventures, which Mike and I started in 2010, has a high performing portfolio of 27 tech start-ups and remains an important part of AOL,” said President of AOL Ventures Jon Brod, who will continue to oversee the group. “We wish Mike well in his new position and are pleased that he will continue to help manage the AOL Ventures fund.”

(Disclosure: AOL acquired TechCrunch back in 2010, but you probably knew that.)

While the details on AOL’s future in venture capital are still unclear, that’s definitely not the case for Brown’s Bowery Capital: it’s focused primarily on B2B startups that could strike a chord with a younger generation of CTOs and CMOs. The most prominent companies in the Bowery portfolio that fit that vision are Codecademy, Sailthru, Premise, and Moat, all startups that Brown invested in as an angel.

That’s not to say that relationships he and the rest of his team made with AOL Ventures’ portfolio companies have gone up in smoke — of the $33 million in capital that has been committed to Bowery, $30 million came from larger institutional investors (including AOL, as AllThingsD points out) with the remaining $3 million being chipped in by “90 percent” of the AOL Ventures portfolio companies Brown was involved with.

And Brown is still actively helping out those AOL Venture portfolio companies — the team held a quarterly meetup for those startups’ executives at AOL’s offices in New York earlier today. Unlike the sorts of CEO get-togethers that firms like First Round Capital are known for, the one held today was meant for chief marketing and revenue officers to swap notes and take in talks conducted with leaders from Buzzfeed, Box, and Pandora to name a few.

A brief aside: it’s actually a little embarrassing to be covering Bowery’s news like this. The TechCrunch New York team works in the same office as AOL Ventures (well, when we managed to crawl out of our hovels), and as I write this I’m looking at the desk where Bowery Capital general manager/former AOL Ventures chief of staff Keegan Forte used to sit. In case you were wondering, that whole area is covered in BC swag. Not pictured: me facepalming for not catching on any sooner.

Online video is booming, and today AOL (owner of TechCrunch) unveiled three new initiatives that spell out how it plans to tackle it: 15 original, unscripted shows; a new creative studio, Be On, to create branded videos; and a deal with FreeWheel and Mediaocean to add in AOL’s video inventory to its platform, so that media buyers looking for multiscreen investments across TV and online video can include AOL in the mix.

The news was unveiled at the company’s 2013 Digital Content NewFront event, the upfront event where AOL presents its strategy for the year ahead to key advertisers and agencies.

The slate of content is not AOL’s move into Netflix-style dramas (for now, at least). Instead, it plays on the network of sites that AOL already owns in the news and information space, which also includes other tech sites like Engadget as well as the Huffington Post. Up to now the AOL On network, the video network that AOL launched last year to span all of those sites and more (the videos go to YouTube and elsewhere) has been going pretty strong, with some 8 billion views in 2012. “We think we’ve reached the point at which it makes sense to produce more, to give us a more distinct voice,” Tal Simantov, GM of AOL On said. The list of shows includes “Fatherhood,” centered around Hank Azaria and his experiences as a first-time father; and “City.Ballet”, produced by Sarah Jessica Parker, covering the cut-throat world of the New York City Ballet. A preview of the video content is at the bottom of this post.

Simantov wouldn’t say how much AOL is investing in this but says that it will be in the “double-digits, an interesting number.”

One reason that AOL is spinning out more content is because of a growing audience for the material, but it is also looking to sell significantly more ads against it.

Part of that will be coming from the new Be On studio — this is the company’s branded content business, a creative studio that will partner with advertisers and agencies to produce branded content that combines its goViral acquisition with video distribution across AOL’s own network of sites plus third-party sites like YouTube, and AOL Studios production. The offering includes production, distribution, and analytics to measure how they perform.

The move for content companies to move further into video ad production, leveraging their reputation with other content, is part of a wider trend — just yesterday, Vox Media also announced the formation of Vox Creative, a similar initiative. Today, AOL announced the first customer for its service — Team Roma — the Italian football team that is planning a media assault in an attempt to become the next big international media sports brand, not unlike Manchester United or Real Madrid, both of which make more from their branded goods and selling rights to their games than they do from ticket sales to those events.

The third announcement AOL made today for the partnership with FreeWheel and Mediaocean will see AOL tap into the wider market for video ad buys, with ad buyers now able to buy against not just broadcast and pay-TV content, but online video content as well, through a multiscreen ad buying platform being launched by FreeWheel and Mediaocean called FourFronts. Given that the vast majority of ad spend today still goes to areas like television, it’s initiatives like that that will give digital players more of a look in to those budgets. And it’s also a significant move to further defragment the advertising landscape.

As Tim Armstrong, the CEO of AOL puts it, it’s also a sign of how the “screen” that people use to consume video is no longer just a TV, and that video is no longer just television.

“The device on which consumers view video no longer defines the type of content they’re watching; it’s purely a screen,” he said today. “But until now, buyers have not had an apples-to-apples comparison when it comes to buying video on the Web and TV. The industry needs to adopt standards between traditional broadcasting and video streams on the Web to create more opportunities in the buying market. FourFronts addresses a pressing need in our industry and will place AOL at the forefront of this shifting tide, getting us one step closer to bridging the gap between premium digital video and TV.”

Michael O’Connor, global director for business at AOL On, notes that “This will mean that we won’t be seen anymore as segregated buckets.” Since this initiative is just getting announced now, he says that AOL is not yet sharing a target number for how much AOL expects to see going through the platform. “The decision making only starts now,” he says.

While there’s still few details and no official announcement, AOL is shutting down its AOL Music news properties and is firing their employees, according to tweets from the official AOL Music site Spinner’s account and some staff. Poor performance due to competition from independent bloggers may be to blame. However, reports indicate Winamp, SHOUTcast, and flagship music blog Spinner may survive.

AOL Music operates a variety of music news websites for different genres, the SHOUTcast Internet radio site, and the historic Winamp player it acquired in 2009 along with Spinner in a $400 million acquisition of Nullsoft.

Here’s how the pink slips flew this morning. First, Spinner tweeted: ”@Spinner: All of AOL Music is shutting down. Thank you all for your support. We had such a blast.” However, it appears that tweet has since been deleted. You can see retweets of it here, though.

Later, Spinner Editor Dan Reilly tweeted:

Well, we all just got laid off. AOL Music is finished.—
Dan Reilly (@danreilly11) April 26, 2013

Then Reilly and several other Spinner employees began essentially live-tweeting the demise of the site they ran:

Sitting in an HR meeting right now, trying to negotiate keeping our computers for a few more days.—
Dan Reilly (@danreilly11) April 26, 2013

Well, at least I found a good reason to finish off the whiskey at my desk.—
Dan Reilly (@danreilly11) April 26, 2013

Paul Cantor, the hip-hop editor of Spinner wrote:

Just lost my job. Actually I'm in the room losing it right this second, while tweeting. So yeah, hit me with any opportunities.—
  (@PaulCantor) April 26, 2013

The AOL Radio gave some official condolences but noted it will stay open:

It's a sad day here at @AOL. We'd like to say goodbye to our colleagues at @AOLMusic, @TheBootdotcom, @Noisecreep, @Spinner and @TheBoombox—
AOL Radio (@AOLRadio) April 26, 2013

For those who are inquiring, @AOLRadio will still be around and we will continue to be bringing you the best music experience.—
AOL Radio (@AOLRadio) April 26, 2013

Meanwhile, other music sites such as The Onion’s AV Club are reaching out to the several dozen fired employees with job offers or freelance work, and the canned AOL staff seem receptive.

Along with music.aol.com, AOL Music runs the site The Boot (country music), Noisecreep (metal), Boombox (hip-hop), and Tour Tracker (concert tickets), which presumably are also getting the axe.

While Twitter’s new music app happened to launch last week, it’s unlikely it had anything to do with the AOL Music shut down. Instead, it’s likely a reflection of poor performance by the site. When they started over ten years ago, AOL Music and Spinner were some of the only options out there for breaking music news. But as the music blogosphere blossomed, readership likely fractured to different sites with more specific personalities and genre focuses.

Well from fellow AOL employees (they own TechCrunch too), we give our hearty condolences to the AOL Music and Spinner staffs. Hope that whiskey helps.

Haha. AOL Music is trending on Twitter. Finally figured our social media strategy out!—
Dan Reilly (@danreilly11) April 26, 2013

And thanks to everyone who offered their support today. I'm truly humbled. Now I guess it's time to tie one on.—
Dan Reilly (@danreilly11) April 26, 2013

Update: Perhaps not all is lost, as it seems Reilly has finished his meeting with HR and just tweeted:

Maybe you haven't heard the last of Spinner. I don't know. I'm glad I got to post this last interview today aol.it/11q8EH0—
Dan Reilly (@danreilly11) April 26, 2013

Meanwhile, music writer J Herskowitz has tweeted:

I'm hearing that Winamp/SHOUTcast are still intact. #aol #music—
J Herskowitz (@jherskowitz) April 26, 2013

Aol CEO Tim Armstrong sang the praises of programmatic, automated advertising today during his keynote presentation at the Ad:Tech conference in San Francisco, and he announced a new Marketplace tool to help publishers manage their ads. So when Fortune’s Adam Lashinsky took the stage to interview him, he asked: Was it meaningful that Armstrong didn’t talk about Aol’s content and publishing business?

After all, Lashinsky pointed out that Aol has made some pretty big investments in content, especially with the acquisition of properties like the Huffington Post and, yes, TechCrunch. Armstrong answered that he still sees content as a big opportunity — he was just tailoring his message to the audience.

Indeed, if you look at companies like Amazon, Netflix, Google and Microsoft, it seems like more tech companies are getting into the content business. Armstrong argued that Aol was one of the first online ad companies to “try and jump in and do both sides.”

At the same time, Armstrong acknowledged that there does seem to be a shortage of big-name talent in web content and that he’s looking forward to seeing “a lot of the brainpower” moving from offline to online. (I’m not sure what kind of talent he was referring to, so I’ll try not to take that personally.)

“If we were to take all the technology people in this room and switched them to content management systems, the opportunity is just as big,” Armstrong added.

Continuing on that theme, Lashinsky said that traffic to Aol properties doesn’t seem to be growing. Armstrong said it’s been “a very, very challenging situation” because Aol is trying to “switch the engines while the plane is flying” — there are new properties that are growing, but the company is also saddled with others that are declining or that it has shut down. The good thing, Armstrong said, is that the mix of Aol’s traffic “looks different than it did three years ago,” that “Wall Street has gotten more excited,” and that “we’ve been able to stuff the company with lots of talent.”

Lashinsky also asked Armstrong about his earlier statement that if he was making the decision for himself (rather than Aol), he’d be interested in buying Time Inc. Armstrong said that’s because he’s a big believer in the media brands that Time has built: “People undercut how powerful brands are.”

My boss Alexia Tsotsis really hates that word, but to illustrate his point, Armstrong said that Fortune hosts a successful conference every year based on the magazine’s brand — if Armstrong wanted to start “Tim’s online finance site” and hold his own conference, he said, “I would bet on Fortune more than Tim’s finance.” He also said that Aol is trying to acquire “meaningful” online brands. That was the rationale behind the HuffPo and TechCrunch acquisitions, and he said they’ve led to traffic and revenue that has “exploded.”

As for the new Marketplace product, it’s a supply-side platform that Aol is pitching as a competitor to Google and as something that completes the company’s ad-tech stack.

Much like this gif, Aol added another layer of management last week. Aol Brands got its own CEO, Susan Lyne, to round out the triumvirate of Aol Networks CEO Ned Brody and interim Membership CEO Bud Rosenthal. And, in an impressive sleight of hand, the company also lost a layer of management, with COO Artie Minson out, perhaps due to Patch’s less-than-inspiring performance.

Because Aol reorgs are almost always baffling, Arianna Huffington and HuffPost CEO Jimmy Maymann get to be the bosses of Huffington Post, not answering to Lyne even though HuffPost’s and HuffPost Live’s traffic and revenue will be listed as Brands revenue on Aol earnings reports. Being one of the more recognizable brands, TechCrunch too will get the kid-glove treatment, with Lyne promising we’ll retain editorial independence.

“You’ve increased your traffic massively with little or no input from Aol. You don’t need help,” she told me in an interview, above, on her very first day in her new role. And on Arianna in the room? “The Huffington Post has a well-developed plan for growth, including Huff Post Live and more international expansion. There’s lots we can do together, but my time is better spent on areas that are not growing as fast.”

What else? Other than there are, as of yet, no plans for a TechCrunch “Swimsuit Issue”? Well, Michael Arrington is her favorite TechCrunch writer. Just wait until she gets a load of Lawler.

Aol today confirmed a couple of big changes at the top of the company, as first reported yesterday by ourselves, Bloomberg and AllThingsD. Susan Lyne, the exec who had previously been CEO of Gilt Groupe and an Aol board member, is the new CEO of Aol’s Brand Group (including TechCrunch). Meanwhile, Artie Minson is stepping down as COO as the role disappears from the company.

As detailed in the memo from CEO Tim Armstrong, Minson is staying for a transition period, working on Aol’s “current and future commerce and subscription strategy and business.”

The length of the transition period is not specified. Meanwhile, a spokesperson confirmed that Aol will “not be backfilling the COO role.”

The reason for the changes, Armstrong notes, is to match the company’s management structure better with its strategy — a three-pronged business focusing on advertising (Aol Networks), media brands (Aol Brand Group) and subscriptions (Aol Membership). Specifically, he notes that today’s appointment of Lyne marks “more decision making and resources directly into our brands. We have spoken many times of the work we are doing to improve our brands and product and today is another step in unleashing the power of our brands for consumers and customers.” Ned Brody continues to run Aol Networks, with Bud Rosenthal as interim CEO of Aol Membership.

Lyne stepped down as CEO of Gilt last year but remained as chairperson. She then transitioned to vice chairperson, and the Aol spokesperson confirmed that she will remain in that role.

The Aol spokesperson also confirmed that Lyne is leaving the Aol board as part of the new appointment.

Prior to Gilt, Lyne was president and CEO of Martha Stewart Living Omnimedia.

Although the brand group includes sites like TechCrunch, Engadget and recent addition gdgt, Huffington Post continues to remain separate and run separately by Arianna Huffington.

Apart from the fact that Lyne will already be familiar with the business because of her previous role as a board member, there are signs that there may be a closer relationship across all of Aol’s content operations:

Armstrong notes that Aol “will continue the work with Susan on setting up cross-site scale as we grow the content business,” and he adds that “Arianna and Susan have been friends for years and we will spend a lot of time working on deeper strategy for the future of the content business.”

Internal memo from CEO Tim Armstrong below.

Thank you for all the hard work on the 100 day sprint. The teamwork and alignment of resources is coming together nicely and it looks like there are going to be some exciting outcomes for consumers and customers.

One part of the sprint we have been working on is talent and we have announced a series of talented people joining AOL in our major segments of business. Moving to a segmented structure has allowed us to focus deeply on our brands and businesses. Returning to growth after 8 years of not growing is directly related to the talent we have and our ability to move the company into white space areas of opportunity while we improve our core business. Today, we are adding to the talent and focus of the company and I wanted to share some exciting news with you.

We are announcing a talent and leadership structure that is aligned with each of our operating units with the goal of increasing the communication flow and cross-segment operating teamwork. The update to our structure matches our strategy and will also put more decision making and resources directly into our brands. We have spoken many times of the work we are doing to improve our brands and product and today is another step in unleashing the power of our brands for consumers and customers.

We want to welcome to AOL a world-class talent who is recognized on a global basis for her experience in content, commerce, and leadership. She has been part of Fortune’s Most Powerful Women’s List, she has been the CEO of a publically traded brand, she is the chairman of one of the best women’s commerce businesses on the Internet, and she has been with AOL since the day we re-launched as a public company – as one of our stellar board members. Please help me welcome Susan Lyne, one of the most talented people in our space and someone who will continue to help us raise the talent and growth level at AOL. Susan is not only a world-class talent, she is a world-class person and you will see that as you get to know her. She joins Karen Dykstra, our former board member and current super-star CFO, as a leader who is moving from being a board member to being a full time AOLer. Please welcome Susan, she will be in the office today and you will hear more from her over the next week.

Susan will be CEO of the AOL Brand Group, a group that includes some of the Internet’s best brands. She will manage the AOL brand portfolio on a global basis. Susan has been a highly engaged board member and I have leaned on her often during the turn-around and having her join the company is a significant step for AOL. As part of the continued focus on our investment in the Huffington Post, Arianna will continue to report to me and we will continue the work with Susan on setting up cross-site scale as we grow the content business. Arianna and Susan have been friends for years and we will spend a lot of time working on deeper strategy for the future of the content business.

The company will be organized with Susan running the AOL Brand Group, Ned Brody running AOL Networks, and Bud Rosenthal, acting as interim CEO of AOL Membership. Susan, Ned, and Bud will report to me and will join Arianna and the other Sales, Technology, Legal, HR, and Communications leaders.

Another part of today’s announcement is that we will be restructuring the COO role within the organization. As part of the changes, our talented COO leader, Artie will work directly with me on our current and future commerce and subscription strategy and business. Artie has made meaningful contributions to AOL as part of the executive team and he is at a point in his career where he is looking for his next step and he will be doing that at AOL. Artie’s teamwork on the turnaround of AOL and his ability to look for growth opportunities in AOL’s core business is something we will continue as we look deeper into the subscription area.

We are building a company that improves our consumers’ and our customers’ lives. We’re going for world-class products and a creative organization that is backed up by a strong financial backbone. We’re going to do both – grow and strengthen. Please join me in welcoming Susan Lyne and let’s keep up the work that has allowed us to bring AOL back to life – TA

Image: Crunchbase

AOL (owner of TechCrunch) today is taking one more step to build out its content empire: it has officially confirmed the acquisition of technology reviews site gdgt — first reported by TechCrunch nearly two weeks ago. Gdgt itself is announcing the news on its own site, and a spokesperson from AOL has also confirmed the news to TechCrunch directly.

Financial terms of the deal have not been disclosed, but we have heard that the deal was in the high seven figures, and that there was another — higher — offer from another company, but that gdgt’s co-founders, Ryan Block and Peter Rojas, went with AOL because it was a better fit.

It seems poetic that the future of a company so deeply embedded in the Internet’s past would hinge upon amassing properties that so vehemently chronicle its future. The deal will see Ryan Block take on a bigger role at AOL, where we have heard from sources that he will become head of product for AOL Tech Media. He will report to Jay Kirsch, and will take some of the learnings, technology and sensibility — and staff — that he and Rojas have brought to gdgt and apply them across AOL’s portfolio of tech sites.

In addition to TechCrunch, those sites include Engadget (which Rojas founded and Block used to edit), TUAW and Joystiq. In other words, the acquisition will give gdgt much greater scale for its product.

With AOL’s tech portfolio heavy on blogs and news, gdgt will be bringing complementary content in the form of a huge database of gadget information, created with the aim of “improving the buying experience,” in the words of Block.

The move lets the two founders come full-circle and, for those who ever wondered, provides more color on why they left in the first place.

“We didn’t leave Engadget (or AOL) because we were unhappy, we left to do gdgt because at the time it was tough to build something that was clearly not editorial,” Block told me. “That’s obviously changed, and we’re excited to be able to continue to invest in and grow gdgt, while also bringing a lot of the stuff we’ve built to the rest of AOL Tech.”

The move is not entirely out of the blue. Peter Rojas — who will stay on running gdgt as well as take on a role as executive editor-at-large at Engadget — notes that gdgt has been working with Engadget (and some other publishers, via a WordPress plug-in) via its Databox for about 15 months now. That automatically pulls data from gdgt’s product database into a module at the bottom of posts, similar to how TC pulls in data from Crunchbase.

AOL, via AOL Ventures, had been one of gdgt’s strategic investors prior to this announcement, along with True Ventures, Betaworks, Spark Capital, Lerer Ventures and several angel investors. In total it had raised $3.72 million.

The move is key for AOL, in that it gives the company another way to bring in traffic to its existing portfolio of news sites, and it also, by way of gdgt itself, increases traffic across the network.

And, the fact that gdgt focuses on the buying experience should not go unnoticed. At a time when companies like Facebook and Google are making an effort to derive extra revenue streams from e-commerce to supplement their bread and butter of advertising, it makes sense for relative Internet dinosaur AOL — which last week reported its first return to revenue growth in eight years — to explore this area, too.

Here is the official announcement from gdgt:

We’ve got some big news: we couldn’t be more excited to announce that gdgt has been acquired by AOL!

As you might recall, last year we started a fruitful partnership with the fine folks at Engadget toprovide structured product data to their site. We got to talking further and realized that gdgt, its team, its technology, and perhaps most importantly its DNA, were a natural fit for the world-class lineup of tech sites. Well, one thing led to another, and here we are. We honestly couldn’t be more excited about adding gdgt to what is easily the most powerful, influential group of technology media brands in the world.

Where we go from here
Over the last year, gdgt has only become increasingly more robust and refined, and we’re only getting started. (Related: have you seen all the great stuff we’ve been doing lately, like aggregating video reviews?)

At AOL, gdgt will only continue to grow and evolve as the best premium destination for purchase intelligence, recommendations, user reviews, shopping data, and community-driven content about personal technology. gdgt’s product database (still arguably the best around, in my highly biased opinion), community (ditto), and core technologies will serve as a crucial foundation for all kinds of great new products and services we’ll be building in the coming months.

Our event series will also expand, shall we say, as we pair up with the Engadget team on our 2013 nation-wide tour. Stay tuned for details there, too.

What this means for your data
As you might expect, over the coming months we’ll be transitioning our operations to our new parent, as well as adopting their Terms of Service and Privacy policy.

It should go without saying that we continue to completely respect your personal data and privacy, as we always have. For example, AOL has never asked us to hand data over any user for any untoward uses, so gdgt users’ email addresses aren’t going to wind up on some random mailing list after the dust settles. Makes sense, right? AOL isn’t acquiring gdgt to drive away our users. Nor would we let them.

However, we still totally understand if you don’t want your profile data to join us on this new journey. If that’s the case, starting later today (and through March 15th, 2013) just head over to your account settings to mark your account profile data for deletion.

No action is required, though! If you don’t do anything, your profile will remain intact, and we’ll just keep doing what we do to make gdgt the best possible gadget reviews and community site around. Also, the next time we see you we’ll totally give you a high five.

Roll the credits
It’s obvious, but we owe this great outcome first and foremost to the amazing team of gdgt employees, each of whom took a chance on us and stuck around to see things through. They know that all this stuff is much harder than it looks, and gdgt simply would not exist if it weren’t for their boundless passion. As founders, Peter and I are extremely grateful for the work they’ve done.

It’s also impossible to talk about gdgt’s existence without mentioning the enormous trust and faith placed in us by Tony Conrad at True Ventures, Jason Calacanis, and Mo Koyfman at Spark Capital, and our many other ridiculously smart investors like John Borthwick at Betaworks, David Lee at SV Angel, and Ken Lerer at Lerer Ventures (just to name a few!). I feel like most startups would (and should) consider themselves extraordinarily lucky to get to work with even one of those folks.

Finally, we’d like to thank Jay Kirsch, Tim Armstrong, Ned Desmond, Tim Armstrong, Tim Stevens, and all the folks at AOL who believe in our product, our team, and our DNA. We honestly couldn’t think of a finer group of folks to come work with, and we’ve got big plans together. Come watch what happens!

AOL’s Q4 earnings today saw that company (which owns TechCrunch) finally make a turnaround, after 8 years of decline, into revenue growth, with overall sales of $599.5 million. But there are still a lot of areas that are seeing flat or declining revenues, and some that are loss-making: among those is AOL’s hyperlocal effort Patch. On the investor call today, CEO Tim Armstrong admitted that the division had not reached its revenue target of $40 million-$50 million, and that it was still unprofitable (specific losses not released), but that the aim was for it to reach profitability by Q4 of this year.

Making money in hyperlocal is not always proving to be easy. NBC just yesterday shut down its own hyperlocal service EveryBlock after “struggling with the business model.”

Armstrong appears to remain committed to Patch, however. “I’ve been spending a fair amount of time at Patch,” he noted. It’s seen 41% growth among users in December, and it’s still beating down expenses, with costs down by “double digits.”

On the other hand, part of the challenge for Patch, he noted, was Sandy. “We didn’t expect the Sandy storm and it followed the path of Patch rollouts,” he noted, and that had a direct impact on ad revenues, particularly in the local ads segment. But, he noted, Patch became more essential at the same time as people looked to the site for information.

Another area where Patch may see some developments is in the area of partnerships. “We’ve had a lot of companies approach us on partnerships,” Armstrong said. He described AOL as taking the “Walmart approach,” with Patch, by giving small-town people a big-town experience. The hope is for Patch, Armstrong noted later in a phone interview, is to become a kind of channel for smaller communities to have the same kind of coverage that larger cities get in their news and information sites: in effect, even suburbs should have their own Time Outs, filling in the gap created by the downsizing or closure of other local media properties such as newspapers and broadcasters. And then, advertising should follow: Armstrong noted that Patch now covers 10% of suburban communities — “but they represent 30% of GDP,” he said, because of their affluence.

For now, though, Patch remains a drag on revenues. “Our Patch investment has influenced the margins over the years,” said Karen Dykstra, the CFO. The company chose to leave Patch out of its larger OIBDA expenses calculations.

Other businesses that were mentioned on the call include AOL Music. Powered by Slacker, it is “about the size” of Spotify in the U.S. in terms of traffic. However, with 10 million monthly uniques, it only just about cracks the top-10 music properties in the U.S. at number 8, COO Artie Minson noted, and “we’re not satisfied at all at being number 8.”

He said that AOL has relaunched a number of properties such as Moviefone “and we think that to unlock value in music we have to update the product.” There was no timeline given on when that would happen. It also sounds also like AOL will be looking to put its Music property closer to other sites, such as the teen-focused Cambio.com, to bump up users and usage.

Later on the phone, Armstrong wouldn’t rule out that this might lead to partnerships with other music companies beyond Slacker (perhaps with Spotify, which works with Yahoo, or others): “I don’t have any announcements at all on this, but we’re thinking deeply about the music space, thinking organically and partnership-wise,” he said. “It’s a space that is interesting and exciting.”

One more property that looks like it will get some more attention is Mapquest. Armstrong noted that a new subscription service is in limited beta right now and the expectation is for that to roll out further in Q2. “The opportunity here is in data,” Minson said, “where people are going in their cars. That’s an interesting B2B opportunity.” This is a route that companies like Nokia have followed by partnering with carmakers to embed its Here mapping service, such as a recent deal with Toyota.

That speaks also to AOL’s wider mobile ambitions and whether it will look to refocus efforts there. AOL, if you recall, restructured its mobile operations last year, leading to a number of people leaving the company and some functions getting more localized among different properties and brands. Today, it’s a mixed picture for AOL and mobile. There’s clearly lots of opportunity for advertising there but traffic, and perhaps strategy, is very uneven. AOL.com only sees 10% of its traffic from mobile devices, while on sites like Engadget and TechCrunch, mobile can be up to 50% of all traffic.

Update: Further comments added in above from a phone interview with Armstrong after the earnings call.

AOL (owner of TechCrunch) has just reported earnings for Q4 2012: revenues came in at $599.5 million on earnings of 41 cents per share. That matches analysts expectations on EPS but beats on revenues of $573.1 million. The figures show that after years of decline, the company continues to get back on track with revenue growth.

Within that, advertising — the largest portion of AOL’s revenue — grew by 13% to $410.6 million. Within that, display, at $169.8 million, was essentially flat on a year ago, while search ads — which it offers in partnership with Google — were up by 17% to $103.6 million. Ad revenues from third-party networks — AOL works with sites like parenting.com to provide advertising alongside their content — brought in revenues of $137.2 million — a rise of 31%.

Subscriptions, which essentially refers to AOL’s legacy dial-up Internet access business, brought in $174.2 million, a decline of 10%.

Still, when it comes down to how different divisions are pulling in revenues, AOL still attributes the most revenues on its balance sheet to its Membership group, which includes AOL Mail, subscription services, AIM and related items. These were at $231 million, a decline of 9%. Second in line was the Brand group, which includes properties like the Huffington Post and TechCrunch, whose revenues were up by 4% to $213 million.

As a point of comparison, last quarter AOL reported flat revenues of $531.7 million, although that in itself was an achievement, since it was the first time in seven years that AOL had not reported a sales decline. Earnings per share in Q3 were 22 cents. With those results beating expectations, AOL’s stock jumped by some 22% after the news, although it did drop back down and before the market opened today were trading at $31.41.

In Q4 a year ago, AOL reported revenues of $577 million, on an EPS of 23 cents per share.

Full-year revenues, also reported today, were up by 8% to $1.4 billion. Free-cash flow for the quarter was down by 36% to $46.3 million, but up for the full year by 49% to $245.1 million. Part of the decline in cash flow in the quarter, AOL says, was because of a special year-end bonus paid to employees as a result of the company’s $1.1 billion patent sale to Microsoft (which worked out to bonuses of $1,056 ). AOL says that it had $466.6 million of cash and cash equivalents at December 31, 2012.

AOL, which first started life in the 1980s providing early online interactivity for Atari and Commodore consoles, pivoted in 1988 into a business as one of the first big Internet service providers, and saw growth skyrocket. Fast forward more than two decades past a merger/demerger with Time Warner and another pivot, AOL has spent years refocusing itself as an online media company, running advertising across its own network of online properties as well as those of third parties. Still, it continues to make a good portion of its revenues from its old dial-up business, although that continues to shrink.

So, to show that it continues to focus itself as a media content business built around advertising, AOL has been trimming, rebranding and growing assets. This week, in the lead up to today’s earnings. Two businesses that did not fit into its bigger strategic idea are now gone: About.me was spun out as a separate business and Hipster.com was closed down. Advertising.com — which includes the Advertising.com display ad network that runs across AOL properties, AOL On video network, the goviral content distributor, the Adtech management platform and Pictela for content-based advertising – was renamed AOL Networks. And it is reportedly buying Gdgt, a tech blog started by two of the people who used to run Engadget (another AOL property). (A sale has not been confirmed.)

About.me, the personal profile page startup co-founded by Tony Conrad, and acquired days after its public launch by AOL* back in 2010, is going it alone again. The move was announced by Conrad and co-founder Ryan Freitas on about.me’s blog:

Twenty-four months and several million about.me pages later, we continue our commitment to building the best personal identity service on the web. During the past two years, we’ve been thankful for the tremendous resources and support of our friends and partners at AOL.

Today, we’re thrilled to announce that we’ll be spinning about.me back out, returning to life as an independent company that is financially backed by our management team and a truly amazing group of investors who have backed companies such as WordPress and Google. Our team will remain the same for the most part, and we’ll continue our roles as co-founders.

Conrad said the decision to spin out from AOL was not down to any sort of disagreement or “classic” culture clash between the big corporate entity and the creative upstart startup. Rather he said AOL’s acquisition strategy is “very focused on media” and there just weren’t the product integration opportunities that had originally been envisaged. (And on the media side, only yesterday rumours surfaced that AOL is looking to buy consumer electronics site Gdgt.)

Conrad told TechCrunch: “Our experience at AOL has actually been great. That’s genuine. They’ve been really supportive of us — we’ve hired, our team has doubled in size. They’ve given us a lot of air cover, a lot of support… [But] the reality is AOL is very focused on media. When we sold about.me part of the thesis was that we’d be able to be integrated into mail, we’d be integrated into AIM… And there really hasn’t been integration opportunities.

“We’re a big cost centre to AOL. I don’t think that serves their purposes well if they don’t see the long term integration.”

Taking the business independent again “just felt like the right move — for the brand, for the product, for the team”, added Conrad. Conversations about spinning back out have been going on for the past year. AOL, which bought about.me for a seven-figure sum, remains a shareholder — so it asked about.me’s team to raise enough capital to go it alone.

To that end, about.me has raised $5.7 million, led by True Ventures, said Conrad. Other investors include SoftTech VC, Google Ventures, CrunchFund and others. ”We’re excited as co-founders to have the brand back, and to go for it and to build hopefully a product and service that crosses over into every household,” added Conrad.

Asked what’s next for about.me, he said its focus will be looking at ways of making it easier for people to link their online identity to ‘calls to action’ — such as requests for work along the lines of ‘hire me to be your X’ or ‘buy my Y’ — which he said a lot of people are already putting in their about.me page text or subtitle. “We want to dive deeper into that,” he said.

About.me’s blog announcing its return to startup life can be read in full here.

*AOL is also, of course, the owner of TechCrunch.

One of the high points of last week’s DLD Conference in Munich was the What’s Next? panel which explored the future of media in the digital age. Buoyantly chaired by DLD host Yossi Vardi, the panel included longtime media exec Jon Miller, whose illustrious career includes stints as Chairman and CEO of AOL and Chief Digital Officer at News Corp.

So, I asked Miller when we sat down at DLD, what indeed is next in digital media? Miller’s response was encouraging for content creators in TV, music, and books. Companies that actually produce digital content, he explained, will become more valuable than companies that are simply channels for distributing content. And it’s television, Miller told me, that will become the key “battleground” in the war to successfully create models for distributing digital content.

Miller’s optimism about the music, TV, newspaper and publishing industries is encouraging. He’s bullish on the New York Times’ freemium model, optimistic about new music subscription services like Spotify, and is even hopeful that the publishing industry is finally understanding how digital technology can successfully reinvent the analog book. Which may be why Miller is now setting up his own (still unnamed) investment shop that will take advantage of what he sees as the myriad opportunities in tomorrow’s digital economy.

You know, I love Aol. I seriously do. The company has some stellar health and dental benefits, and they brought Mike and MG back, and there are definitely some individuals who work there that go above and beyond what’s necessary in being thoughtful, generous, and helpful (hello Trisha Dearborn, you saint you!).

It is also pretty great to have someone – anyone – pay you to write about technology when you are obsessed with technology, and for that I am forever grateful. Don’t tell Jay Kirsch, but I would probably do this job for free if I could make sure I’d have a roof over my head and ample feta cheese on my plate while doing so. Okay, not really.

BUT (come on, you knew there was a ‘but’ coming …) other times, Aol reminds you that it is still a big-ass bumbling company, like when the HR person in charge of the Aol TechCrunch acquisition “transition” asked if I was MG, and then scurried off (disappointed?) to find him when I said “No.”

Also when all the TechCrunch team has to complete a mandatory 45-slide “Aol Standards of Business Conduct” training annually, even though TechCrunch has way different standards of business conduct, or when, God bless them, the Aol legal department sends us the below email in response to a joke we made in this post about how we tended to write about rumors on Sundays. “Rumor Sunday!®” har har.

Hi Ned,

A colleague in Legal spotted the use of the trademark Rumor Sunday!® in the first paragraph of a recent TechCrunch article.  I can’t quite tell if Rumor Sunday is a mark that TechCrunch intends to use or a third party mark.  There are no registrations for “Rumor Sunday!” in the USPTO records (thus the ® symbol should not be used with the term.)  The term hyperlinks to a techmeme.com page which doesn’t appear to contain any reference to Rumor Sunday or Snapguide (the subject of the first paragraph).

If you intend to use Rumor Sunday as a mark, please provide information re the services and whether it will be used primarily in the US or elsewhere so that we can conduct a trademark search.

Thanks!

[Redacted]

Sigh. This, of course, caused A HUMOROUS, MOCKING THREAD amongst writers (sample below). For those of you out of the loop, co-editor Eric Eldon is the funniest person at TechCrunch, which is saying a lot considering TechCrunch is a pretty ridiculous place.

And I don’t know what specifically makes big companies as unfunny as Jay Leno, but I do know that we’re going to add some © and ™ s in future posts to see if Aol continues to not get it ®. And keep you guys in on the joke.

This post is Copyrighted 2013, All Rights Reserved.

Like Scrooge after discovering the True Spirit Of Christmas, AOL is offering a shiny half-crown (worth $1,056) to the little boy (its employees) as thanks for bringing the prize Turkey from the Poulterer’s this holiday. The $1,000 cash bonus is a celebration of the company’s $1.056 billion patent sale it made earlier this year.

I rarely, if ever, comment on internal AOL stuff but this is a nice gesture at the right time. The company is doing well in the markets and traffic is up for its properties. Patch, the hyperlocal news organization of the future, has shown its true value in the wake of recent news in Connecticut and, in the end, AOL is still trucking even after many wrote it off.

I wish, in my heart of hearts, that “Tiny” Tim Armstrong would appear before the gathered employees and do a quick, Mary-Lou-Retton-style tumbling routine like in Scrooged, but perhaps I’m dreaming too big.

AOL closed at 30.94 today with a high of 31.

AOL just announced that it has acquired Buysight, a startup offering ad targeting and retargeting.

The startup will become part of the Advertising.com group, which includes AOL’s various ad platforms, such as Advertising.com, ADTECH, The AOL On Network, goviral, and Pictela. (AOL also owns TechCrunch.) In the acquisition press release, the group’s CEO, Ned Brody, said Buysight’s technology will be incorporated into AOL’s Adlearn optimization technology.

Buysight was founded in 2008 and was previously called Permuto. One of the main features highlighted in both the press release and the startup’s website is its ability to do “dynamic creative optimization” — in other words, it’s not just using user data to target an ad, but also to tailor ads to the content. It raised a total of $16 million in funding from investors, including Onset Ventures, Rembrandt Venture Partners, Reid Hoffman, and Jeff Clavier.

“The acquisition of Buysight brings proven Dynamic Creative Optimization and machine learning capabilities which will further enhance AdLearn, our market-leading optimization engine, and its ability to provide brands and performance marketers a comprehensive and integrated optimization solution across channels,” Brody said.

The terms of the deal are not being disclosed, but the press release said the entire Buysight team will be joining AOL.

Update: I just got off the phone with Brody, who told me that he had been looking at this market for a while now, and specifically at partnering with some of the larger companies, before deciding that it made more sense to own the technology.

Asked why he chose this company in particular, Brody said as a test, his team has already been running Buysight campaigns on Advertising.com properties and seeing impressive results. He added:

It was the combination of ease of working with advertisers and the efficacy of the mediation. The architecture of their system lends itself to integration with Adlearn, so [after the integration] we expect it to significantly outperform what they had been able to do historically from an optimization standpoint.

Brody also said that a decision hasn’t been made on whether to maintain the Buysight brand. He noted that historically, when Advertising.com acquires a company, it maintains the separate brand while integrating the business.

AOL (owner of TechCrunch) reported earlier today its quarterly earnings for Q3 2012 ending September 30. The results beat expectations with a flat revenue of $531.7 million compared to Q3 2011. It’s the first time in over seven years that revenue didn’t decline. Net income was $20.8 million compared to a net loss of $2.6 million in the same quarter last year. Diluted earnings per share were $0.22.

As the company beat expectations, shares (NYSE:AOL) have popped and closed at $43.70, 22.03 percent higher than yesterday. Consensus analyst estimate from S&P Capital IQ expected $522 million in revenue, around $10 million less than what the company reported.

When it comes to performance, traffic was up for all AOL properties, with 111 million unique visitors every month. It represented a 4 percent increase year-over-year but a decline of 1 million compared to Q2 2012.

More importantly, global ad revenue was up 7 percent year-over-year, with $340 million compared to $317.7 million, thanks to an increase in search and contextual ad revenue. The domestic display ad revenue was down 3 percent year-over-year.

Dial-up subscription revenue was down 10 percent year-over-year. Even though it was anticipated, it was the lowest rate of decline in six years. The company has successfully compensated for the revenue loss with advertising revenue.

Last year, AOL invested more than $300 million to develop Patch, a network of local news websites. The company reported 11.9 million unique visitors for September 2012, a 19 percent increase year-over-year.

AOL’s video network is now the second largest video network by views according to comScore. The company experienced double-digit growth in video revenue with 100 percent more video impressions sold through Advertising.com

“We just reported the best relative revenue performance in seven years and the second consecutive quarter of year- over-year profit growth, exceeding our expectations,” AOL CEO Tim Armstrong commented in a statement. “We have positioned AOL for growth in 2013,” he continued.

During the earnings call and in an interview with Reuters, Armstrong confirmed that the main focus is now advertising and video. In other words, after investing in building or acquiring strong content brands, the company is now focused on bringing more revenue.

AOL shares are up 130.1 percent over a 12-month period, which is nothing short of astonishing. Comparatively, over the same period, Apple shares are up 46.7 percent, Google shares 14.6 percent.

A year ago sucked. I mean, it was actually great, but it sure seemed to suck at the time. We were getting CrunchFund off the ground and I think everyone thought we were going to do that in full conjunction with Aol — they were and are the largest limited partner of the fund, after all.

Instead all hell broke loose.

You know the story. And this is now the fourth goddamn post on TechCrunch about TechCrunch today. But hey, at least it’s not another Apple story, right? RIGHT?!

Anyway, as you’ve read, both Michael Arrington and myself are coming back to TechCrunch. I’m extremely excited about this. No, things won’t be exactly the same as they were a few years ago. But they never are. They can’t be. They shouldn’t be. It’s about moving forward. That’s exciting.

But wait, I never left in the first place, right? Sort of. I cut a last-minute deal on my way out the door to keep up the Apple beat here and there, but it was never truly thought-through. I wasn’t gone, but I was falling. Like Gandalf chasing the Balrog from underneath Moria to the peak of Zirakzigil, I would eventually die.

And then come back.

So now the plan is to write about whatever I want. Most of the time that will still probably be about Apple — they are the most important tech company on the planet, after all. But I’d be lying if I didn’t say it was a challenge at times this past year to write a column that had to be about Apple is some capacity — even if it was only in the URL slug a time or two.

But aren’t Michael and I horribly conflicted? Yeah. So? Who isn’t in some way? It should be about transparency, not some weird form of supression.

But, but, but, but we’re financially conflicted! That’s worse! Here’s the thing: I don’t intend to write about our startups on TechCrunch. Neither does Michael. That was never the plan. Quite frankly, as a reader, I hate it when investors pull some of the masturbatory shit about their companies over and over and over again. See: Twitter, everyday. See also, the phrase: “killing it”.

It’s all about trust. You have to trust that I’m writing something because I believe it, not because something you don’t care about needs publicity on TechCrunch. As an investor, that can be a bit of a gray area because you can always fall back on: “well I wouldn’t have invested if I didn’t like the company” — something I use quite often, because it’s true. That’s why we believe it’s best to keep stories written by us specifically about our portfolio companies off of TechCrunch. This site has a huge audience that obviously just isn’t mine — or even just Michael’s anymore. The audiences on our own blogs are ours. That’s the better place for those posts.

I intend to write about a variety of things, probably late at night — just like I used to do. Not all the time, but sometimes. I still do have that day job which is my top priority — CrunchFund is going strong one year in, “killing it,” as it were. And I’ll still maintain my other blogs which are more about spreading interesting content and personal blogging.

That’s the thing, I’m doing this because I love writing about technology. I can’t stop, won’t stop. And I love TechCrunch. It just made sense to fully combine the two once again. To come back.

And yes, I just wrote this entire post and made the ridiculous Gandalf/Balrog reference just to be able to justify that title and image. It’s good to be back.

The way we use email has changed dramatically in the past decade-plus — written down like that, it seems like an almost laughably obvious statement. But David Temkin, AOL’s senior vice president of mail and mobile, argues that email clients haven’t kept up with the changes — with the last major innovation coming in 2004, when Gmail launched.

Given its age, and its association with the early, “You’ve got mail!” days of email, AOL (which owns TechCrunch) might not seem like an obvious candidate to do anything innovative in this area. However, the company isn’t just bolting on some new features to the existing AOL Mail product. Instead, it’s launching an entirely new webmail client called Alto, which is being gradually rolled out in a limited preview starting today.

According to Temkin and Josh Ramirez, senior director of product for AOL Mail and Alto, the new client actually has its roots in an attempt to overhaul AOL Mail. However, it became apparent that any major redesign would falter on the attempt to serve two different audiences — the existing userbase, which isn’t really interested in seeing any dramatic changes, and another group that’s looking for, in Temkin’s words, “a new product intended for and matched to how people use email today.”

The biggest change in Alto versus other email clients is a new concept called Stacks. They basically function as a way to pre-sort your email, so that you’re not stuck reading through daily deals from Groupon and notifications from Facebook when all you really want to do is see if you’ve got a new message from your friends and family. They’re like folders or labels, but managed through an intuitive drag-and-drop interface, and allowing users to decide that they want to make large swaths of their email bypass the main inbox entirely, to be saved in Stacks where they can be read later.

When you first set up an account on Alto, it will create Stacks (assuming there are applicable emails in your inbox) for social notifications, daily deals, and messages from retailers. You’ll also get a Stack that highlights all the photos from all the messages in all your inboxes, and another with all the attachments. You can create new Stacks by just dragging emails into the main dashboard, and you can also customize the rules around each one — namely the specific senders, recipients, or subject lines that signal whether an email belongs in a Stack, and also whether each Stack should skip the inbox or not.

Again, the idea behind Stacks isn’t entirely new (besides its obvious roots in email folders, you could also compare it to efforts like Other Inbox), but the implementation seems smart and intuitive. Ramirez noted that email folders are largely “aspirational” — something that users want to use, but often aren’t able to keep up with. With Alto, a lot of the basic setup is already done for you with the initial Stacks, and it’s also quite easy to create new ones. Once they’re set up, Stacks can just run automatically without any interference, though you can be more hands-on and customize the rules if you want.

“Not an entirely new idea, but well executed” is a description that could be applied to many of the features in Alto. As Temkin and Ramirez demonstrated the product, I was less impressed by any one feature and more by the sense that Alto was built up from lots of smart touches. And with a design that’s driven by images and icons rather than row after row of text, it just looks good — as I kept glancing back-and-forth between the demo screen and my own computer, where Gmail was open in the background, I couldn’t help thinking about how cramped Gmail looked in comparison.

Another important feature is the fact that you won’t need to sign up for a new email address. (“We need another email address like we need a hole in the head,” Temkin said.) Instead, you can use it with your existing email accounts — initially, it’s offering support for Gmail, Yahoo! Mail, AOL, and .Mac mail accounts, and Temkin said it should eventually include any IMAP-based email account.

Other features include a visual search interface with instant results that appear as you type, profiles for contacts that include their latest social network updates, and a slick interface for browsing retail newsletters and daily deals. Ramirez said that last feature is kind of like a TiVo for “bacn“-type content, allowing you to read it later, rather than mixing it in with more personal and important messages. And he argued that Alto, like TiVo, might actually increase the amount of newsletters, deals, and the like that you’re willing to read, because it gives you control over when you consume the content.

Then there’s my favorite feature, an email “snooze” button. As others have observed, for many of us, email has become our default to-do list, unfortunately organized based on who emailed us last, rather than real priority. With the snooze button, you can move an email off the top of your inbox/to-do list, but it returns to the top after a given period of time. Basically, it’s a way of making sure that important emails don’t slip through the cracks, even if you don’t have the time/inclination to deal with them right away.

The current version of Alto hasn’t really been optimized for smartphones or tablets yet, but it already seems to work pretty well on a tablet — Temkin argued that’s because it “almost has a tablet design aesthetic in the first place.”

As for what all this means for AOL Mail, Temkin said the company plans to support both Alto and AOL Mail as different products for different audiences. But if all the cool new stuff is going into Alto, doesn’t that suggest AOL is going to let the older product die, albeit slowly? “Absolutely not,” Temkin said, adding that there’s still a big appetite for “a classic mail experience.”

You can request an invitation to Alto here.

ComScore just published its latest U.S. search market numbers and things aren’t looking too good for Yahoo. Yahoo’s Bing-powered search lost another 0.6 percentage points and now has just 12.2 percent of the market. That’s down from 12.8 percent in August and 13 percent in July and June.

The networks that apparently profited from Yahoo’s dip are Google, which added another 0.3 percentage points and Ask, which is also up 0.3 percentage points. With this, Google now commands 66.7 percent of the U.S. search market and Ask 3.5 percent.

Microsoft’s Bing held steady last month at 15.9 percent in comScore’s rankings. In total, comScore reports, Bing powered just over a quarter (25.1 percent) of all U.S. searches in September.

TechCrunch parent company AOL is still the smallest of comScore’s top 5 search engines and came in at 1.8 percent last month, up 0.1 percentage points from August.

As far as total search volume goes, comScore says about 16.3 billion searches were conducted in September. That’s down about 4 percent from last month. Unsurprisingly, Yahoo also saw the largest drop here. The total number of searches on the site decreased by 9 percent.

Yahoo’s Troubles Continue

So far, Yahoo’s new CEO Marissa Mayer hasn’t announced any changes to the company’s strategy in the search market. If Yahoo wants to stay relevant in this business, though, Mayer will have to make some changes and do so sooner rather than later. Search brings in about a third of Yahoo’s revenue, and given Mayer’s background in search, she will likely institute some changes soon. For the time being, though, her focus seems to be more on PB&J than on improving Yahoo’s search.