AOL may be brushing up its brand image in preparation for its spin-off IPO in December, but brushing up its underlying business will take a little longer. Barclays analyst Douglas Anmuth released a report on AOL today complete with an earnings and revenue model going out to 2014 (see below). He projects absolutely no growth in revenues over the next five years, and only a one-time bump in profits in 2011, due to cutting one third of its current labor costs, before declines set in again.

In other words, investors who buy AOL stock will do so because it is a cost-cutting and turnaround story not a growth story, and that will determine what kinds of investors will buy the stock. Anmuth outlines some of the key factors which investors should be paying attention to.

As AOL prepares to spin off from Time Warner early next month, it is going through a slight rebranding. The AOL logo is changing to lowercase with a period (Aol.). The new branding campaign that is about to launch features the logo revealed as white space inside different images and pictures (see below).

The video above is a sneak peak of AOL’s brand advertising campaign, which again reveals the new AOL logo over different images that the company wants to associate the brand with. The attempt here is to try to portray AOL as trendy, vibrant, and interesting—as far as artsy splashes, a headbanger and an acrobatic trio doing flips off one of their own manages to do that. The point is that AOL wants to reveal itself in unexpected ways.

It does need to reboot its image, I’ll give it that much.

Last week, it was reported that AOL – amid restructuring efforts in the lead-up to the imminent Time Warner spin-off and IPO – was putting its instant messaging service unit ICQ on the block and had hired bankers Allen & Co. and Morgan Stanley to assist in the sales process.

According to the reports, AOL was looking to offload the asset for $300 million and talking to a pair of non-US companies about an acquisition (likely in a part cash, part stock transaction).

Question is: who are those potential buyers?

AOL CEO Tim Armstrong this morning informed staff that the company will be looking for 2,500 people to voluntarily hand in their resignations, which would represent about one third of the company’s payroll.

The news comes a mere week after AOL, which is preparing to spin off from Time Warner and go public, said it would be firing at least 1,000 employees and spend about $200 million cleaning house prior to the planned IPO.

Remember all that talk about Bing starting to fizzle in September? Well it didn’t happen, and now October numbers and Bing gained another half a point to reach 9.9 percent market share of U.S. searches, according to comScore’s qSearch service. Five months after launch, Bing has steadily gained two points of market share.

And it is keeping the pressure on, with deals to index realtime data streams from both Twitter and Facebook (Google also has a deal with Twitter, but not Facebook), a deal with Wolfram Alpha for nutrition and diet data, and the constant rollout of new features such as better video search.

It’s been a long decade, but AOL will once again be an independently traded company on December 9, when Time Warner will spin off shares. Every Time Warner shareholder (disclosure: including me, from when I was employed there) will receive shares in AOL using the following formula: one share of AOL will be distributed for every 11 shares held in Time Warner.

In other words, we finally have an approximate market capitalization for AOL. The business will be valued at 1/11th 1/12th the value of Time Warner. At today’s market cap of $37.8 billion for Time Warner, based on a closing price of $32, that implies a $3.4 $3.15 billion market cap for AOL. Unless Time Warner shares surge over the next few weeks, it will be in that ballpark. Update: My initial math was slightly off. As some commenters point out, the implied value is 1/12th of Time Warner since at the time of the distribution everyone with 11 shares will receive an additional share. SInce we know how much Time Warner is worth, it is possible to come up with an implied value for AOL based on that ratio, even though that value will change the minute the shares start trading.

As AOL prepares to spin off from Time Warner in an IPO, it wants to gussy itself up so that it looks as appealing as possible tp ublic investors. Today, AOL disclosed that it plans yet another restructuring which could cost as much as $200 million. The biggest cost savings from any restructuring is usually through layoffs, and the latest round has already started at AOL, with 100 let go this week and as many as 1,000 of its 6,000 jobs at risk of being eliminated.

Despite new leadership under CEO Tim Armstrong, AOL has yet to turn around financially. Last quarter, revenues sank 23 percent to $777 million. The biggest drop came from subscription revenues to its legacy Internet access business, down 29 percent, but advertising revenues also took a hit, down 18 percent. AOL depends on display advertising, which has not yet rebounded like search advertising appears to be doing.

After two straight quarters of annual declines (aka, the Great Ad Recession of 2009), it looks like online advertising revenues stabilized in the third quarter. The combined online advertising revenues of Google, Yahoo, Microsoft, and AOL rose 1.2 percent to $8 billion. While the online advertising industry is not out of the woods yet, it might be stabilizing.

At least it is for Google, which was the only one of the four horsemen of Internet advertising to see its ad revenues rise in the quarter (up roughly $400 million from both last quarter and last year). Yahoo, AOL, and Microsoft were all down on both a sequential and annual basis. (All the individual company figures are in the table below). Google benefits more from search advertising and is less exposed to display. The question now is whether display advertising will follow the recovery already being experienced by search advertising.

Brad Garlinghouse, a former SVP at Yahoo, joined AOL as President of Internet and Mobile Communications two months ago. And he’s clearly doing a little housekeeping, and forming his own exec team. His first major hire? Kiersten Hollars, a Digg PR exec.

Hollars is part of Garlinghouse’s old team at Yahoo, and left the company shortly after Garlinghouse did to take over PR and communications at Digg. She joins AOL later this month.

“This is more about working with Brad again, and nothing about Digg,” she told us in a phone interview this morning, adding that she’s excited about the turnaround opportunity at AOL. She joins AOL as senior director of corporate communications, reporting to both Garlinghouse and EVP Corporate Communications Tricia Primrose.

Digg’s looking for Hollars’ replacement immediately. So if you want be the person to handle all corporate communications and Kevin Rose babysitting duties at Digg, let them know.

AOL is losing another longtime executive, David Liu. He is the senior vice president in charge of Global Messaging, which includes AIM, ICQ, and AOL’s more recent Lifestreaming products. Liu spearheaded the transformation of AIM into a lifestreaming client that mixes private and public messages from Twitter, Facebook, and elsewhere.

When CEO Tim Armstrong was looking for someone to head up AOL’s overall Internet and mobile communications, which also includes email, Liu was the strongest internal candidate. But Armstrong decided to go outside the company and hired Brad Garlinghouse, who used to be in charge of all of Yahoo’s communications products.

A couple days ago at the Web 2.0 Summit, AOL CEO Tim Armstrong caused a little bit of a stir when he hinted that AOL is working on a “secret” technology project. When pressed for details on what exactly it is, he was vague. But after fishing around with our sources, we have a pretty good idea.

The secret project is a new content-management system (CMS) which will make it easier to produce and publish Web content across AOL’s sites and perhaps beyond. It will also help AOL scale up the number of contributors who write articles and produce videos for its numerous media sites well beyond the thousands who are working for it today.

At the Web 2.0 Summit today in San Francisco AOL’s chairman and CEO Tim Armstrong took the stage for a discussion with Federated Media’s John Battelle. Armstrong, who was previously in charge of the Google ad group in America took the AOL job in March as the company prepares the split from its parent, Time Warner.

The Armstrong talk can be summarized pretty easily: Content, content, content. Armstrong made it very clear that not only is AOL in the process of spinning off into its own public company, but that they are now going to be a content company. In fact, they’ve gone from 500 journalists to over 3,000 since he took over. And that will keep growing.

An interesting tidbit has emerged from America Online’s lawsuit against Advertise.com over the latter’s alleged trademark infringement and unfair competition with regards to AOL-owned Advertising.com. (One is Advertise.com, the other is Advertising.com. Yeah, I was confused too).

Well, a preliminary ruling came out last week when the U.S. District Court for the Eastern District of Virginia granted the startup’s motion to transfer the case over to California, where Advertise.com is headquartered and where AOL boasts multiple offices.

We got our hands on the court documents (embedded below), which conveniently reveal some previously undisclosed numbers about Advertise.com’s current and projected revenues.

It’s the way of many acquisitions – a startup gets bought, and a couple of years later, after the earnout expires, the founders get an itch to start something new.

AOL acquired Goowy, a creator of Flash widgets, in early 2008. Now, we’ve confirmed, the core team – Alex Bard, Gary Benitt and Jeremy Suriel, have left AOL to start their next company, Assistly. Brad Birnbaum, formerly the CTO of eShare and Talisma, joins them as well.

So what is Assistly? We don’t know much yet. The website says little more than “Coming soon… Customer service done right. Brought to you by Alex Bard, Brad Birnbaum, Jeremy Suriel and Gary Benitt.” But I did manage to get a little bit of information out of Bard. He says of Assistly:

Foursquare is the location-based iPhone app getting a lot of love in the press (and from VCs) these days. And while there is no shortage of location social networking apps in the App Store, Foursquare works well on the platform because it’s based on the active checking-in to venues, which is perfect since the iPhone doesn’t allow apps to run in the background (though Loopt has a workaround). While Brightkite has also long been in this space, it’s been a while since any new viable competitors have come along. But we recently got two more: Gowalla and Going.

AOL has been seriously testing lifestreaming in various betas for AIM and AIM Connect for a few months now. At TechCrunch50, AOL just announced that lifestreaming will come out of beta on September 22 and will be part of the AIM product portfolio across Windows, Macs, the Web, iPhones and Windows Mobile.

Last week, the paid version of AIM for the iPhone was updated with lifestreaming capabilities. Today, lifestreaming is coming out of beta across AIM 7 for Windows, AIM for Mac, AIM for the Web, and AIM for Windows Mobile.

A few months ago AOL found a way to fuse AIM, its popular instant messenger client, with the broader messaging systems like Facebook and Twitter that have begun increasingly important on the web. AIM now includes a new tab dedicated to the lifestream — a combination of your friends’ activities on Facebook, Twitter, Flickr, AIM itself, and a variety of other services (think of it as a FriendFeed with integrated chat). Tonight they’re bringing the lifestream to the iPhone with AIM 4.0, which is now live on the App Store for $2.99 (the free version doesn’t currently offer this functionality).

AOL, under new management and with a spinoff IPO on the horizon, continues to fill out its executive ranks.

The newest hire: former Yahoo exec Brad Garlinghouse will join AOL as President of Internet and Mobile Communications. Garlinghouse will report directly to CEO Tim Armstrong.

Garlinghouse will take control of AOL’s mail and instant messaging products. He’ll also head AOL’s Silicon Valley operations in Mountain View and serve as west coast lead for AOL Ventures. Bebo, acquired by AOL in early 2008, is now part of AOL Ventures.

In July, AOL Instant Messenger (AIM) embraced the stream in a new beta (for both Windows and Mac) and started moving beyond simple IMs. You can now see your Facebook and Twitter feeds, along with AIM buddy updates and feeds from other services.

The problem was that the Twitter and Facebook feeds were only one way. You could read them, but you couldn’t send updates from AIM to the other services. A few weeks ago that changed, and AIM status updates can now appear as updates in Facebook and Twitter as well.

AOL, rather than fixating on building business and staying relevant post Time-Warner, is suing search and display platform provider Advertise.com for trademark infringement and unfair competition. Furthermore, the company is also partly responsible for the near-done sale of the domain name Ad.com for a reported $1.4 million falling through, leading to the seller of the domain name subsequently suing the buying party, says DomainNameWire.