These shuttered sites will be relaunched "magazine style," highly edited, presumably long-form and no longer written by the rag-tag bunch of aspiring journalists that Weblogs has long paid dollars per article.

Update: AOL's Stephanie Dolgins has responded to our request for comment, saying that "There is absolutely no truth to this rumor. In fact, it's quite the opposite...We are so enthusiastic about the growth potential of our Living blogs that we need people to spend MORE time on them, and we are asking for more of a commitment from our lead bloggers than has been needed in the past so that we can provide consumers with more engaging and interactive experiences across our sites..." Take that for what it's worth, for now we believe our original source on this.

Six months ago AOL told an angry mob of Weblogs writers that despite cutbacks and work slowdown orders, everything was actually better than ever for the network. Several requests for comments on this story haven't been responded to yet.

Weblogs Inc. has long been a great place for new bloggers to find part time work writing on topics they love for between $5 and $15 per post. This author started there, for example, before getting a job at TechCrunch and then here at ReadWriteWeb.

There used to be a strong sense of camaraderie at Weblogs. In the early days every blog in the then sprawling network would put up one post each week linking out to the most popular posts on other blogs, as if the differences in content were less important than the blogging format readers were believed to love.

The egalitarian ethos suffered some turbulence with the rise of electronics blog Engadget as one of the very strongest blogs on the entire internet and presumably worth far more than the estimated $25 million that AOL paid for the entire network in 2005. There have been a handful of other standouts, but the majority of the Weblogs blogs have failed to deliver like AOL would have liked. Why, no one may ever know. Travel blog Gadling, for example, has only had 4 stories hit the front page of major traffic driver Digg in the past year, despite frequent pleas for promotion on its internal email list and an affinity for "boobs around the world" schlock content. If that formula doesn't work then maybe nothing will. Update: AOL wrote again to tell us that Gadling is no longer considered a Life Style blog. Lucky them.

Over the years, tensions never got resolved between the more corporate AOL and the scrappy Webloggers. Network co-founders left after their contractual requirements were up, Jason Calacanis now runs human search and Q&A site Mahalo and Brian Alvey runs another blog network called Crowd Fusion, focused on particularly high quality content and sophisticated publishing technology. Meanwhile the market for remainder content has grown more crowded by the expansion of Canada's B5 Media and MySpace co-founder Brad Greenspan's acquisition-happy web of crap called LiveUniverse.

What's AOL to do with Weblogs Inc.? Maybe turn it into what AOL knows and trusts more than blogs, a collection of mainstream-feeling magazine sites run by more traditional journalists.

The web won't be better for it. The loss of opportunities for aspiring pro-writers is a real tragedy. The failure of this landmark network of blogs calls the financial viability of blogging in general into question. We and others believe that an "anyone can do it" media economy is emerging, but if only a handful of blogs are truly able to effectively monetize then one has to wonder.

Immediate staff reactions though have been anything but positive. While Moe tells a story of aggressive growth, we're hearing that the bloggers who made the business are feeling manipulated and let down.

Posting schedules should be back at or near what they were before once budget bumps are resolved, Moe said.

Numbers

Moe told bloggers that the network saw record traffic in July, with more than 300million page views this month from 41m unique visitors. There was not any mention of how those numbers were distributed, though Moe emphasized the success of properties other than mega-blog Engadget. It's notable that Engadget founding editor Ryan Block recently announced his departure from the company.

2007 revenue grew by 115% and 2008 is on track to grow by "solid double digit margins," Moe said. Despite widespread unrest among staff, blogger compensation has also continued to grow, he told staff. Budgets for blogger pay grew 35% in 2008 and full time staff has already grown by 20%.

International Expansion

Moe emphasized that the company plans aggressive expansion outside of US markets, some having already begun. Properties have been launched in Germany, Poland, Korea and Spain but haven't been announced as AOL sites yet.

These claims are corroborated by reports we're hearing of AOL headhunters contacting top bloggers about expansion of new and existing properties.

How About A Raise Already?

Some bloggers complained in the call that they had not recieved a raise in more than 2 years, despite their properties seeing growing traffic. Moe told them that breaking the budgets out blog by blog would make those kinds of decisions "easier to make."

Moe also explained that many of the blogs that have faced cuts were struggling to reach a point of profitability that was desired. The same markets, from DIY to weddings, would be engaged with in the future - the company just hadn't decided how to yet.

Internal Reactions: Not Good

We're hearing from sources inside the company that morale is at an all time low and today's call may have made things even worse. Moe's denial that deep cuts are what is occurring was not well received. Smart bloggers on staff are cutting right through the corporate-speak, we're told, and it isn't a pretty picture. The rank and file is putting up a bigger fight than corporate apparently expected and things continue to be messy.

Update: Some Weblogs Inc. bloggers have responded in comments below that they are not upset at all. Note taken. We have received confirmation from multiple AOL employees that this post is an accurate representation of how many people inside the company feel.

If Marty Moe was describing the situation accurately, then Weblogs Inc/AOL is not at all an example of a blogging down turn. It's instead a story of one of the biggest blogging networks in the world getting lean and mean as it shoots towards the stars.

Maybe it's just a matter of whose framing of the events you believe. A blog network needs happy bloggers though, and AOL seems to have anything but that. What does it say for the business of blogging and new online media in general? That's what we'll be watching for.