The following commentary comes from an independent investor or market observer as part of TheStreet's guest contributor program, which is separate from the company's news coverage. NEW YORK ( TheStreet) -- The departure of TechCrunch founder Michael Arrington could have adverse consequences for AOL's ( AOL) business. It also casts an unbecoming light on its leadership, as the media world continues to whine over potential conflicts of interest between AOL's TechCrunch and Arrington's poorly named CrunchFund. Following the announcement of the fund, the ensuing confusion of what Arrington's role with AOL was going to be only added to the drama. What should have been a simple announcement turned into a mess where AOL management, including CEO Tim Armstrong and Ariana Huffington, appeared confused, with conflicting statements on Arrington's role and the treatment of TechCrunch. So while this should be a non-event, the bigger question is whether this provides a window into how AOL runs. It could also explain why AOL is, losing ground to competitors like Google ( GOOG), Facebook and Yahoo! ( YHOO) on most metrics. We have a price estimate of $14 for AOL stock, which is roughly in line with the current market price.
With already dwindling revenue in many of AOL's businesses and drooping traffic, it doesn't want to change anything at TechCrunch, if at all possible. It does not want to kill the machine that has been working well for the last year that it has owned it. On the other hand, it can ill afford the bad press it received and so does not want something similar to happen again at, let's say, Huffington Post. So where to from here? It makes sense for Arrington to step down formally and clear the air himself, but given how engrained he is at TechCrunch, this might be difficult. He could keep his head low and wait for this to blow over, but that seems unlikely, given his personality. So all eyes are on AOL and whether it will be forced to make a decision on how to deal with TechCrunch. See our complete analysis for AOL's stock here Like our charts? Embed them in your own posts using the Trefis Wordpress Plugin.