Has blogging queen Huffington really failed in the UK?

It’s been a long-running discussion among UK online journalism enthusiasts over why blogging didn't develop the same way it has in the US. For all the Guido Fawkes and Mumsnets we have, there isn’t much to match Gawker, Techcrunch, Mashable, Blogher, GigaOm and the rest in terms of reach and business success.

But that didn’t stop Arianna Huffington, founder of the biggest blog of them all, launching her eponymous online news and comment site here in the UK six months ago, the first launch outside North America from the Aol-owned site, followed by the launch yesterday of Le Huffington Post in France. Is the project working, or is our sceptered isle too full of newspapers and magazines (and the BBC) to take notice?

Despite some very negative press – including the occasional hatchet job – the omens are not that bad although the challanges are huge. comScore (via paidContent) says that Huffpo UK received 1.6 million unique visits from the UK in December and 4.1 million including non-UK traffic.

That makes it the 11th-most visited news site in terms of UK-based readers, well behind the likes of Mail Online Loading... companies dailymailcouk , Guardian.co.uk and the aggregate traffic being sent to Newsquest Loading... companies newsquest and Johnston Press Loading... companies johnston-press ’s local newspaper sites. It's the most-read news site in America, but has a long way to go to replicate that audience anywhere else.

Engagement is high and Aol tells me that the site received 7,000 comments in one day last week. Today it boasts articles from Cherie Blair and Vladimr Putin – two of the 2,500 people who’ve written for the site since its launch.

Internal problems

Not all may be well with the transition to a wider Aol media group led by Huffington, however. Aol says that Huffpo UK has 20 in-house editors led by editor-in-chief Carla Buzasi, double what it had at launch in july – a staggering amount for what is a relatively small site here. To give some perspective, when the Guardian launched its then-pioneering Comment is Free blogging platform (partly inspired by Huffington) it had a staff of four.

Here's Buzasi speaking at the News:Rewired conference in October on the site's place in the UK's media jungle:

And there are rumblings from within the company that it is diverting resources away from existing longstanding Aol sites with sizeable audiences and respectable revenue streams. One person with knowledge of the company’s operations tells me the impression among staff is that all resources are being given over to the HuffPo project, with some sites fighting to retain their independence. Some 18 properties were launched or re-launched in Q310 alone.

A company spokesman told me: “We are expanding the AOL Loading... companies aol /Huffington Post Media Group business in Europe – as you will have seen from recent announcements this is a key growth area for the business. However, AOL is not only focused on growth through AOL HPMG but also has big plans for investment in our Ad.com Group network business in Europe.”

Aol declined to say what HuffPo UK is making in revenue, but added that its regular advertisers include BA, Nissan, HSBC, Google, Channel 4 Loading... companies google , Vauxhall and News International Loading... companies news-international .

Can Aol afford it?

The big picture here is that Aol is betting the farm, the picket-style fences and all the cows on original and curated content driven by its own branded sites. The question is how long investors are willing to wait to see the benefits of this expansion.

In Q310 (the most up-to-date accounts, pdf) the business had $444.1 million in cash (£285.4 million) with $81.1 million of that coming from on-going operations in the quarter. So there is breathing space and room to invest abroad.

But overall, the revenue trend is not good, with Q310 sales dropping six percent year on year to $532 million (£341.9 million). The company blamed the drop on some longstanding deals it's now got out of and it made $136.7 million from display ads in Q3, 15 percent more than last year.

Essentially this is a problem of scale - most of HuffPo UK's readers come from overseas and London ad buyers don't want to reach people in Texas. Blogging entrepreneur Ashley Norris's analysis in 2008 is just as relevant now:

"It is possible to monetise non-UK ad inventory but it is generally at much lower rates than the UK inventory. The difficulty for most UK blogs and websites is that they simply don't have enough UK readers to interest ad agencies and brands, so they are left to monetise even their UK traffic using ads that have very low CPMs."

Don’t write off the power of the platform - but beware local challenges

Huffpo is denigrated, normally by professional journalists, because it lacks the quality to compete and hired "unpaid bloggers". But its focus on giving over is platform to its readers, who happily contribute thoughtful articles by the thousand, is low cost and has been hugely popular in the States. HuffPo's social tools and system of interpersonal sharing is the best any one has come up with.

London media-land’s obsession with big traffic figures as a proxy for success is (hopefully) waning and there is real long-term commercial value in building relationships with readers and finding out more about them (see here for my views on “unique users”).

Of course, whether the Huffpo-Aol project succeeds in the UK, France, Spain and Italy remains to be seen. Broadband penetration and behavioural shifts to online reading still have a long way to go in Europe – but the sites that capitalise on those trends are the ones building audience and engagement now.

UK publishers have to deal with perhaps the best and most innovative online publisher in the world, the BBC, as well as at least ten serious online compeitors.

So, failed? No, not yet. It's a waiting game for Arianna and Aol's shareholders will be dearly hoping a) she knows what she's doing and b) that the online ad economy grows as fast and some analysts predict it will.