AOL ACQUIRES PICTELA

AOL ACQUIRES PICTELA

High-Definition Brand Content Platform Boosts AOL's Innovative Advertising Offering

Additionally, AOL Accelerates Rollout of Project Devil Ads Across AOL Media Properties: Intends to Enable Format Across All AOL Media by End of March

New York, NY, December 16, 2010 – AOL Inc. [NYSE: AOL] today announced it has acquired Pictela, Inc., the provider of an award-winning global technology platform for serving and distributing high- definition brand content across online advertising and social media. The transaction brings further scale to AOL's suite of premium advertising tools for advertisers, agencies and publishers, including the company's innovative new Project Devil display advertising format. Pictela will remain a separate group within AOL Advertising, based in New York, and will continue to provide its products and services to outside partners. Deal terms were not disclosed. Pictela joins other strategic acquisitions made by AOL in 2010 including StudioNow, 5min Media, TechCrunch and Thing Labs.

"Pictela is an outstanding fit for AOL as we re-imagine the intersection of content, advertising and the consumer experience," said Jeff Levick, AOL's President of Global Advertising and Strategy. "Pictela's product development team is best-in-class, and its beautiful, content rich, media display formats meet Interactive Advertising Bureau (IAB) and Online Publishers Association (OPA) standards that run across AOL Media properties and other publisher sites. We've taken one important step towards spotlighting quality ad content with Project Devil on AOL Media properties, and now we're taking a second by bringing Pictela into the AOL Advertising family."

Levick added, "Our goal is to create the highest quality ad content for the best user experience and monetization opportunities, and we're excited to work with innovators who share our vision and excitement for what brand advertising on the Web should be."
Formed in 2009, the Pictela platform delivers videos, photos and applications in real time across the Web in a range of formats that meet IAB and OPA standards. Pictela is certified by some of the world's largest publishers and is distributed by AOL, Glam Media and Hearst, among others.

"We believe that joining AOL is an outstanding opportunity to combine with a company that is as committed to redefining brand advertising on the Web as we are," said Greg Rogers, Co-Founder and Chief Executive Officer of Pictela. "As one of the world's premium publishers, AOL will not only be one of our biggest customers, it will also be our greatest resource with the scale, technology and commitment to world-class content to help realize the true potential of the online environment."

High-Definition Content with Flexibility for Leading Brands
Pictela has experienced rapid growth with clients across retail, consumer packaged goods, automotive, entertainment and travel sectors. Every high-definition asset in a Pictela unit can be navigated without the user leaving the page. Content can be updated instantly during a campaign, based on data from advanced analytics that measure impressions, interactions and time spent across both paid and shared placements. Pictela data shows that the solution can drive engagement metrics that are three times higher than traditional online advertising.*

Transaction Complements Project Devil
Today's acquisition is the first for AOL Advertising since AOL became an independent, public company in December 2009. It follows the public launch of AOL's Project Devil display advertising format last September. Designed and developed with creative input from some of the most respected people and agencies in the advertising industry, Project Devil radically improves the aesthetic quality, impact and interactivity of online ads. In a departure from traditional display advertising, the new format offers a large ad space segmented into three panels that can be customized with a range of media streams and applications. As with Pictela technology, every Project Devil ad is fully interactive, eliminating the need for consumers to navigate away from the page to explore its features.

Early campaign results, according to AOL internal data, show that Devil ads greatly outperform standard online ads, engaging users to interact with brand advertising at much deeper levels. By uncluttering the page, ensuring 100% advertiser share of voice and providing a large, multi-functional advertising canvas, early Devil ad campaigns have achieved significantly better Interaction Rates (ITR) than the industry average for rich media banners. Following advertiser demand, AOL intends to enable Project Devil across all AOL Media sites by March 31, 2011.
* "2009 Year-in-Review Benchmarks" by DoubleClick

Forward-Looking Statements
This press release contains "forward-looking" statements within the meaning of the Private Securities Litigation Reform Act of 1995 regarding business strategies, market potential, future financial and operational performance and other matters. Such forward-looking statements include, but are not limited to, statements regarding the anticipated benefits of the transaction and other statements identified by words such as "may," "will," "intend," "should," "expect" or similar expressions. These statements are based on management's current expectations and beliefs, and are subject to uncertainty and changes in circumstances, including, but not limited to, changes in our plans, strategies and intentions; the competitiveness and quality of our products and services; our ability to retain, hire and develop key employees; our ability to timely and successfully enable Project Devil across AOL properties; and the intensity of competition. Any forward-looking information is not a guarantee of future performance and actual results may vary materially from those expressed or implied by the statements herein, due to changes in economic, business, competitive, technological, strategic and/or regulatory factors, as well as factors affecting AOL's operations and businesses. More detailed information about these factors as they relate to AOL may be found in the section entitled "Risk Factors" in AOL's Annual Report on Form 10-K, filed with the Securities and Exchange Commission. AOL is under no obligation to, and expressly disclaims any obligation to, update or alter the forward-looking statements contained in this press release, whether as a result of new information, future events or otherwise.

About AOL
AOL Inc. (NYSE:AOL) is a leading global Web services company with an extensive suite of brands and offerings and a substantial worldwide audience. AOL's business spans online content, products and services that the company offers to consumers, publishers and advertisers. AOL is focused on attracting and engaging consumers and providing valuable online advertising services on both AOL's owned and operated properties and third-party websites. In addition, AOL operates one of the largest Internet subscription access services in the United States, which serves as a valuable distribution channel for AOL's consumer offerings.

About Pictela
Pictela, Inc. provides a global platform for distributing high definition brand content and advertising. Pictela units support videos, photos, text and applications. Since forming in 2009, Pictela has experienced rapid growth with clients across Retail, CPG, Automotive, Travel and Entertainment. Pictela technology has been certified by premium publishers and approved by top social networks.

Contacts:
Caroline Campbell (Press)
404-444-7970 (cell); 917-606-4772 (office)

Eoin Ryan (Investor Relations)
212-206-5025
Eoin.Ryan@teamaol.com

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