AOL's Blog King

Last October, the question of whether blogging could be a business was pretty much decided when AOL paid a reported $25 million for Weblogs, Inc., a network of almost 100 blogs on topics like technology, travel and parenthood. The founder of Weblogs, who will still run the company, is 35-year-old Jason Calacanis. A Brooklyn kid with relentless hustle, Calacanis made a splash in the '90s with publications (like Silicon Alley Reporter) that tracked the dot-com boom, and when the bubble burst, he--like the companies he covered--didn't get the expected giant payout. But in 2004, Calacanis got a second chance by setting up a company to generate dozens of ad-supported Weblogs, largely written by freelancers who split the loot with him. His most successful is Engadget, a real-time guide to gadgetry run by Peter Rojas, who jumped from rival blog concern Gawker Media. Calacanis, who now lives in Santa Monica, Calif., talked to us on a trip to New York to visit the Time Warner mother ship.

LEVY: Why did AOL buy Weblogs?

CALACANIS: We had really phenomenal earnings--not just revenue but earnings. The margin on the business is very high. And the growth was spectacular. AOL has this incredible machine that the right property can plug in to, and make back whatever they spend on buying something incredibly quickly. They promote it for a couple days on the home page, and all of a sudden there's a couple of thousand more users or, in our case, more page views.

You've seen that boost already?

It's definitely happening. In two or three months, we've had a lot of our sites go from 10,000 or 20,000 pages a day to 50,000 pages.

Anyone can start a blog. Why couldn't AOL have started its own blog network?