Can IAC turn into a profitable website?



The New York Times Company tried. They failed. Now, media group IAC plans on taking a crack at making a profitable company.

The source for user-generated guides was hit hard by the Google Panda Update in February, 2011. The “low quality bulk content” algorithm change in the search giant sent and sites like it plummeting in the search rankings, their primary playing arena and the source of the majority of their traffic. The ads served on pages found in search generated a lot of revenue, but Panda changed things for the company.

According to Techcrunch:

Alexa ranks as number 37 in the U.S. in terms of traffic, and 80 worldwide. Its pre-Demand Media approach to acquiring content for low prices spawned some 900 subject sites with general interest information on topics like regional foods, parenting and technology. In that, it served as a counterbalance to the New York Times itself both in substance and in business model — the idea behind being very high traffic and advertising sold against that.

IAC owns several companies with similar business models and hopes that the $300 million investment will help them solidify their revenues. The New York Times company bought in 2005 for $410 million.

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