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Bloomberg was all over the rumor that Time Warner would announced during today’s earnings call that it has a spin-off plan in place for AOL. That didn’t exactly happen, but it looks like Time Warner is indeed moving closer to an AOL spin-off. In fact, they’re buying back Google’s 5% stake in AOL.

But, could a spin-off mean a real challenge to Google, in the form of AOL? Well, AOL now as Tim Armstrong, Google’s former head of North American advertising sales and now CEO at AOL. Clearly, with the timing of his arrival to AOL as CEO, Armstrong is motivated. A spun-off AOL will give Armstrong that much more latitude to clean house and do things his way; presumably, the Google way.

For its part, AOL earnings dropped 23%. Armstrong had better get his broom ready, because he’ll likely need it if AOL is become the world-class advertising and content company that it once was.

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