UPDATE 1-AOL buys online marketing network buy.at

(Explains what buy.at does, background on AOL's other purchases)

By Kenneth Li

NEW YORK, Feb 5 (Reuters) - Time Warner Inc's (TWX.N) AOL said on Tuesday it has purchased buy.at, an online affiliate marketing network, as part of a strategy to bolster its Internet advertising operations.

AOL did not disclose financial terms.

Buy.at is a network in which advertisers pay its member Web publishers only when a visitor to the site takes an action in response to an ad, such as making a purchase.

News of the purchase, AOL's fifth in 12 months, comes a day ahead of Time Warner's first quarter financial report, during which investors hope newly appointed Chief Executive Jeffrey Bewkes will discuss a plan to restructure the media conglomerate.

Microsoft's surprise $31 per share offer to buy Yahoo Inc (YHOO.O) last Friday has heightened urgency on figuring out a plan for its smaller rival, AOL.

Time Warner's plans are likely to include a strategy to spin off its 84 percent ownership of Time Warner Cable (TWC.N) and what it has in mind for the future of AOL, Wall Street analysts said.

The one-time online king that served as the training ground for generations of U.S. Internet users has been restructured to focus on being a one-stop shop for online advertisers.

Time Warner shares have fallen as much as 12 percent since the beginning of the year amid a broad market-wide sell-off on fears an economic recession could hurt ad sales.

Since the $112 billion 2001 combination of AOL and Time Warner, its stock has traded primarily on the performance of only two divisions, cable and AOL, discounting the merits of its other content units including cable networks and Hollywood movie studios.

Time Warner shares rose 10 cents to $15.94 in midday trading on the New York Stock Exchange. (Reporting by Kenneth Li, editing by Gerald E. McCormick, Leslie Gevirtz)