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America Online

The Sinking Ship that is AOL 613

EyesWideOpen writes "This article at Salon discusses the ways in which AOL is trying to stay afloat, with the release of version 8.0 of it's software, in a time when AOL (which recently merged with Time Warner) has had a string of bad press -- falling stock prices, SEC investigation, etc. -- attached to it's name. One of my favorite quotes from the article says of AOL: ''It was never really an Internet company. AOL was based on the idea that people needed to live in a halfway house while they became accustomed to the Net.'...If folks can get a better, faster, cheaper online experience by ditching AOL, they'll do it in a heartbeat.'"
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The Sinking Ship that is AOL

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  • by Anonymous Coward on Tuesday October 15, 2002 @10:35AM (#4453597)
    Bankruptcy!
  • by i_want_you_to_throw_ ( 559379 ) on Tuesday October 15, 2002 @10:36AM (#4453601) Journal
    Finally people realize......
    • You mean it made a profit?


      A lot of people will stay with AOL, either because of inertia or because, once you turn off the popups and spam, it's actually an okay ISP. (Not the best, but not terrible.)


      The company is still ****ed, because it's trying to grow at the same rate it was early in its life. It probably won't go bankrupt, but it's bascially the leader in a low-margin business without much room for growth.


      Interestingly, AOL realized this three years ago, and cashed in its own inflated stock for TW. For some insane reason, TW stock-holders took the deal.

  • by mrmaster ( 535266 ) on Tuesday October 15, 2002 @10:36AM (#4453605) Homepage
    While we all hate AOL they still do offer the most access numbers out of any other ISP if you do a lot of traveling.
    • by nightsweat ( 604367 ) on Tuesday October 15, 2002 @10:44AM (#4453689)

      Go with iPass if you can. They contract with a bunch of different ISPs around the world.

      When you call, your "call experience" is logged and reported for billing but also for quality control. If the number you dialed was busy or poor quality, the number will drop down the list of numbers for that city for everybody using the dialer. Thus, the ISP has incentive to keep the lines high-quality (since they don't get paid if you don't use their lines) and you get the best known number wherever you travel.

      Additionally, in a corporate setting, it uses radius for authentication. We use Steel-belted RADIUS to authenticate it against our Win2K domain, but you could use a built in tool.

      No, I don't make money from them. In fact I pay money to them, but I'm actually satisfied with this one vendor.
    • by rkent ( 73434 ) <rkent@post.harvarBLUEd.edu minus berry> on Tuesday October 15, 2002 @10:59AM (#4453841)
      Yes, but for the mephistophelian price of installing AOL 6 (or 7 or 8 or whatever) and letting it take over all of your network connections.

      The "most access numbers" statistic is sort of a chimera; you really only need 1 or 2 per metro area, it's the *traffic* on those numbers that's important. That said, I've had excellent experience dialing up to EarthLink in almost every (US) location I've ever been to, and I can almost always get a line by the 2nd call, while my brother across the room tries to dial the local AOL number for half an hour.

      Also, as a plus over some of the "local + roaming" others are mentioning in this thread, I don't think EarthLink costs more depending on where you are. I've used a corporate account at several locations and had no complaints from the accounting department about charges.

      I'm not a salesperson for EarthLink, but it just seems way preferable to AOL even if they technically have "more" dial up numbers.
    • While we all hate AOL they still do offer the most access numbers out of any other ISP if you do a lot of traveling.

      Actually, I don't hate AOL anymore. Most of the reason they were despised by the congoscenti was their members' idiotic presence on Usenet, but now Usenet has become all but unusable anyway, thanks to idiots from dozens of ISPs. All the worthwhile discussion forums are on private mailing lists and moderated web boards (like this one). I simply don't encounter AOL or its users, so they're really irrelevant to me. But I would be sorry to see AOL go out of business, they're a real bellwether of the industry, and if they're gone it won't be a good sign for the markets.
    • I set AOL up on our account managers laptop so she could access email and such while travelling. It was awful. The software tries to take control of everything in the computer. She was having sooo many problems accessing her company email not in the AOL domain using Outlook Express. I finally ripped it out and went to Earthlink. They have more access numbers in our neck of the woods (OR,WA,ID), OE is their default mail handler, and I have had NO problems yet. Oh yeah, and AOL kept billing us for 3 months AFTER we cancelled the service. They are supposed to be a technology company...who can't get their computer shit together. Give me a break. I think they are trying to milk people for a few more dollars.
  • aol staying afloat (Score:5, Insightful)

    by sallyL ( 581987 ) on Tuesday October 15, 2002 @10:36AM (#4453606)
    there's alot of non-techies out there that can't see doing anything but AOL. AOL has (at least historically) had the touchy-feel stuff down pat. There's also all the people who don't want to change their email addresses. AOL has more going for it than the person who originated this post thinks.
    • by trcooper ( 18794 ) <<coop> <at> <redout.org>> on Tuesday October 15, 2002 @10:46AM (#4453711) Homepage
      Yeah, jsmith893784@aol.com is really easy for people to remember and they don't want to lose that.

    • by Jucius Maximus ( 229128 ) <m4encxb2sw@@@snkmail...com> on Tuesday October 15, 2002 @10:49AM (#4453744) Journal
      One way that many people get AOL for free is that they install one of those thousand hour free CDs and then when the given number of free months has expired, they call up to cancel. Of course the agent tries to convince them to stay on by offering another free month. The user accepts this. The agent gets a monetary bonus for not losing a customer. The customer just lathers, rinses, repeats the next month.

      I suspet that the number of free hours given out by AOL accounts for millions of dollars each month in 'lost' revenue.

      I agree with your original comments about how AOL has the touchy feely stuff down pat. They have huge customer service departments to answer questions when the like "how do I send a picture through e-mail" and so on. I have worked in small home-based businesses selling custom computers and internet access and frankly, support is the most troublesome part of it because most users just don't get it. Although I eschew AOL internet and pre built PCs (dell, gateway, etc) for myself, I must unfortunately recommend such solutions for clueless users because it's the only way they're going to get support for answering stupid questions because the people who run small businesses that ship better products don't have the time or money of all of that.

    • by mmol_6453 ( 231450 ) <short.circuitNO@SPAMmail.grnet.com> on Tuesday October 15, 2002 @11:00AM (#4453857) Homepage Journal
      Indeed.

      When a customer switches from AOL to us [grnet.com], it's never because of our prices, (which are low, compared to the other services available in the area), but because they got fed up with AOL's customer service.

      Usually, they'd been with them for years, but when they started having problems, they'd discover AOL's customer service doesn't do much more than give away additional months of service as retainers.

      We've never, ever had someone switch to us from AOL because they wanted more powerful access.

      We affectionately call them "AOL refugees." :-)
    • by King_TJ ( 85913 )
      Yeah, I think you're absolutely right - but the numbers of these folks keeps decreasing. The point is, in the *long run*, the AOL business model will probably become non-viable.

      EG. At my last employer, we had several users who had AOL accounts. When we started allowing remote access to our systems through a VPN, the VPN tunneling software had compatibility issues with AOL's software. Of course, AOL made no effort to correct the issues. (It was pretty much "over the heads" of those doing their phone tech. support anyway.) We enacted a policy that "AOL is unsupported", if people wanted to use our corporate systems remotely.

      A couple die-hards still refused to switch. One guy even got a seperate Inet dial-up account just for connecting to us at work, but still used AOL for everything else. The biggest roadblock in the way of ditching AOL? Usually, the kids/family. The employee wanting to switch wasn't willing to make his kids and/or wife suffer through getting a brand new email address, learning everything all over again, etc.

      So yeah, right now, some people feel pretty "locked-in" to using AOL -- but the pressure is on them to move away from it. Every time AOL software causes conflicts with other software packages people need, it shrinks their customer base. Every time Microsoft makes it easier to get online without the need of additional software on top, AOL's customer-base shrinks. Every time someone is lured in by the benefits of broadband via their local phone company (who also serves as the ISP), AOL's customer-base shrinks.
  • can it really die? (Score:4, Interesting)

    by carpe_noctem ( 457178 ) on Tuesday October 15, 2002 @10:36AM (#4453608) Homepage Journal
    Is it really possible for AOL to go out of business? Sure, they suck, and they've been losing a great deal of their consumer base, but they are still the single largest commercial ISP in the US. Time-Warner, if anything, would sooner split up AOL into smaller regional ISP's than bankrupt it, I would believe.
    • AOL's Savior? HBO (Score:3, Interesting)

      by CerebusUS ( 21051 )
      Time Warner could save AOL in a heartbeat if they started really thinking about the products they could bring together.

      The merger was touted as the beginning of that great "convergence" thing VC's were all abuzz about in the mid 90's

      You want convergence? Offer AOL broadband subscribers the ability to stream Sopranos episodes on demand. Sex and the City episodes. Mind of the Married Man.

      think about it, they own the client and the transmission technology... it'd be (almost) hack-proof digital distribution.
    • by DrXym ( 126579 )
      Are they losing customers? Last I heard it had grown to 35 million with markets opening up in places like China.


      While I hate the interface designed for idiots, AOL does have certain merits, not least the fact it works from practically anywhere in the world. Most of the time I dial up and minimize the thing and fire up Mozilla or Netscape (which have AOL to thank for their existence BTW). In my trips around the US, I really appreciate the ease that it allows me to dial up some local number and avoid being screwed for long distance calls.


      As I say I tend to use AOL more like a conventional, but ubiquitous ISP, but there have been many times when I've turned to their content too. AOL has some truly excellent content which, unlike a lot of sites on the web is tailored for immediate access. As one example, I find the recipe site particularly useful.


      So really I believe it does have a place. Lot's of people really don't give a crap about learning what PPP is, or other nonsense. They just want to talk to their buddies, chat online or whatever. While AOL is not unique, it does make all this stuff easy and that's the reason people use it. If power users prefer bookmarks and web browsers, then they're probably not the kind of people AOL is pitched at anyway.

  • by Maeryk ( 87865 )
    Served its purpose for me.. I used the startup disk long enough to get (and this is in the misty 3.1 Windows days) the software I needed for my dialup, and never touched it again. I would just as soon see it go away.. think of all the letter carriers who would be able to work longer with not carrying that crap around!

    Maeryk
  • by LordYUK ( 552359 ) <jeffwright821@@@gmail...com> on Tuesday October 15, 2002 @10:37AM (#4453611)
    "Good-bye"
    • by Loki_1929 ( 550940 ) on Tuesday October 15, 2002 @10:40AM (#4453648) Journal
      "Good-bye"

      *Obi-Wan voice*

      "It's as if millions of voices cried out at once, and then suddenly went silent."

      • by GMFTatsujin ( 239569 ) on Tuesday October 15, 2002 @11:15AM (#4453989) Homepage
        Back in the days when I was an AOL tech support rep (shudder) we had this call tracking database that prompted up solutions for various problems encountered by the user base. It was some sort of knowledge base brain-sharing thing, forget what it was called, and everyone hated it anyway. We all had the ability to submit new call types and solutions. So on my last day there I entered a few in....

        This is one of them. For all I know it's still there.

        .
        .
        .

        Version: ALL PLATFORMS
        Problem Type: Connection -- Modem Dialing
        Topic: Other
        Symptom: SERVERS DOWN. CALL QUEUE STATUS LIGHT IS SOLID UNWAVERING RED, AS IF 10 MILLION MEMBERS CRIED OUT AT ONCE -- THEN CALLED TECH SUPPORT
        Resolution: ABANDON ALL HOPE, GIVE IN TO DESPAIR
        Solution: "Sorry, server's down, thank you for calling. Can I interest you in $20 worth of free gas?" ...beep... "Sorry, server's down, thank you for calling. Can I interest you in $20 worth of free gas?" ...beep... "Sorry, server's down, thank you for calling. Can I interest you in $20 worth of free gas?" ...beep... "No, you can't have your money back. Can I interest you in $20 worth of free gas?" ... beep... "Sorry, server's down, thank you for calling. Can I interest you in $20 worth of free gas?" ...beep...
        .
        .
        .

        My supervisor got a call from the QA team asking if that was supposed to be a joke or not, if you can believe it.
        GMFTatsujin
  • by AriesGeek ( 593959 ) <aries.ariesgeek@com> on Tuesday October 15, 2002 @10:38AM (#4453624) Homepage Journal
    Again, I go back to the parents. They used AOL for about a year, until they really learned "how to use" the Internet. Once they got a firm grasp on it, they took off the training wheels, cancelled their AOL account and got a "real" dial-up account through a local ISP. Now that the Internet boom is over, most people who want access probably have it, and they've had it long enough to have taken off the training wheels.

    Just my dos centavos, though.
    • A counter-example: my folks have been on AOL for years. I've periodically suggested that they get an ISP. But basically AOL does what they want, they've taken the time to learn how to navigate it, and they have zero reason to ditch it.
  • by JayDiggity ( 70168 ) on Tuesday October 15, 2002 @10:39AM (#4453629) Homepage
    My family used to use AOL at the rate of $23.95 a month, plus any phone charges that we incurred. When signing my apartment up for Ameritech DSL, they had a special going on - for one year, the price would be $30/month! For $7 more a month, we'd get a free DSL modem, free install, etc. etc. What an amazing deal! I don't know why Ameritech didn't advertise it more, but any family who has a teenage son or daughter that can install DSL can easily be stolen away from AOL - AOL simply can't charge as much as it does for what little it gives.
    • You're assuming everyone wants and would benefit from broadband.

      I'm a geek and I've considered getting rid of mine. Most of what I do on the internet is casual surfing and email reading. I currently don't have Flash installed and block popups; in the past I've disabled downloading graphics and don't miss much.

      Sometimes I do some work from home (via VNC or PuTTY), but I could do that with dialup, albeit painfully slowly.

      Basically I'm paying for broadand to have the convenince of fast downloads occasionally. (OS updates, GNU/Linux and other free downloads, the occasional silly video, etc.) And I used to do that before I had broadband--I'd just start downloading before I went to bed.

      If a non-geek is not a heavy Kazaa user I don't see that they would benefit much from broadband.

      Besides, some people are afraid of "on all the time" internet.
  • by Sabalon ( 1684 ) on Tuesday October 15, 2002 @10:39AM (#4453630)
    I've talked to quite a few people who complain about AOL, but when asked why they don't get a cable modem, or a dialup ISP they start spouting all sorts of reasons such as
    • The cost of an ISP
    • don't want a second phone line
    • don't want to loose their e-mail address
    • don't know much about computers

      Not really sensical arguments, but when they start giving answers like that it's hard to get through.

      Also, where I work, one of our techs had AOL before starting here. Even after having our dial-ups (free) and our T1, he still kept his AOL for a year or two - would even connect to it over our T1 connection.

      Must be nicotine levels or something addictive.
  • Ironic (Score:5, Funny)

    by Anonymous Coward on Tuesday October 15, 2002 @10:39AM (#4453632)
    The sinking ship that is Salon writing about the sinking ship that is AOL.
  • scary part (Score:2, Insightful)

    by alexc ( 37361 )
    the scary part is that some of these ppl are jumping on to MSN. thus giving microsoft another place to monopolize and passport will grow.
  • by IGnatius T Foobar ( 4328 ) on Tuesday October 15, 2002 @10:39AM (#4453636) Homepage Journal
    AOL, whether you hate them or not, is the primary (some might say only) obstacle preventing Microsoft from owning the Internet. If they were to go away, "MSN" and "The Internet" would become synonymous. Is that what you want?

    I don't think I could stand to live in that kind of world. I hope AOL retains its huge lead forever.
    • I'm more worried about Comcast owning the internet. They already own a major portion of the US cable market, and they're offering broadband to all those customers. In fact, they're pushing it rather heavily as a better solution than dial-up.

    • Exactly! (Score:5, Insightful)

      by blazerw11 ( 68928 ) <blazerw@nOSPaM.bigfoot.com> on Tuesday October 15, 2002 @10:48AM (#4453729) Homepage
      If MSN wins, then IE wins (or has it?)

      I'm tired of coding for the crap that is MS's constantly changing browser standards. I have a web app that works on Netscape 6.x and higher as well as the Mozilla's that spawned them and other Gecko based browsers. However, it only works on IE 5.5. It won't work on 5.0 because the JavaScript and DOM are incomplete and 6.0 renders pages horribly.

      If IE is to be the standard, then there will be NO standard.

  • Wishful thinking (Score:4, Insightful)

    by Eric Seppanen ( 79060 ) on Tuesday October 15, 2002 @10:40AM (#4453644)
    I have a hard time believing that the millions of 12:00-blink-blink idiots on AOL are suddenly deciding to abandon their safe little world and jump ship to less idiot-friendly ISPs. I have no problem with idiots using AOL; I just wish that it didn't give AOL the money and the power to affect the future of the internet.

    But they do have better focus on ease-of-use than almost any software company out there. Hasn't anyone here tried to talk people away from AOL? I have, and they won't leave. It's almost as though they... like it.

  • What? (Score:5, Funny)

    by sharkey ( 16670 ) on Tuesday October 15, 2002 @10:40AM (#4453645)
    It was never really an Internet company.

    That can't be right! The AOL tech I had helping me troubleshoot a cable-modem connection told me unequivocally that AOL is the Internet.
  • Ironic... (Score:3, Troll)

    by toupsie ( 88295 ) on Tuesday October 15, 2002 @10:40AM (#4453647) Homepage
    One failing media company [thestandard.com] is dissing another failing media company.

    I hope that AOL's woes don't tear down Time/Warner which has many great media properties that will be scattered to the winds if AOL needs to gin up some cash. Over the weekend, I heard analyst say that if AOL had not purchased Time/Warner, the Time/Warner stock would be around $40 and AOL would be around $4. Right now, AOL is at $11.89. I wonder if former Time/Warner stock holders feel like idiots for approving the merger.

    • Re:Ironic... (Score:5, Interesting)

      by guacamolefoo ( 577448 ) on Tuesday October 15, 2002 @11:19AM (#4454019) Homepage Journal
      > Over the weekend, I heard analyst say that if
      > AOL had not purchased Time/Warner, the
      > Time/Warner stock would be around $40 and AOL
      > would be around $4. Right now, AOL is at $11.89.

      I have always thought that AOL was never in the business of selling internet access. It was in the business of selling AOL stock.

      Because I own parts of a couple of various businesses, I get a pile of free magazines, including "Inc." "Inc." is for "growing businesses" and "entrepreneurs". Lovely people, those. Unfortunately, the writers at "Inc." are horribly out of synch with real live american small businesses. One example of this was the Inc article where it was discussed how one whould "market" a company for sale. Lo and behold, the company's products and business weren't the interesting thing anymore, the company itself was being marketed. AOL should have been listed in this article as the ultimate example of this. It made the owners of AOL billions.

      AOL shareholders had no way to justify the valuation of their ISP/online service based on revenues or expected future profits (the traditional model of valuation). The ISP business is hard: it is low margin, price-sensitive, the barriers to entry are low, it is basically unregulated, and you're at the mercy of the ILECs. AOL has all these problems -- it's not just other ISPs.

      "Ordinary" dial-up ISPs might sell privately today for $100-$150 a subscriber, and maybe $250-$350 during the bubble. AOL was valued at about $2,500. AOL didn't run from that -- it brayed repeatedly about how its size and scale were so valuable and about how controlling the onramps to the internet was so valuable. But they feared that the game would be up before that value could be locked in.

      So...faced with the prospect of having all their paper wealth evaporate, Case et al ginned up the idea of using a stock purchase deal to buy some legitimate assets. This made perfect sense, and I argued with some friends that more tech bubble babies should have done this.

      AOL could have bought GM or Chrysler or any number of major banks. Instead, they had to buy something with a tenuous connection to an ISP: a media company with a bunch of cable assets. Bingo. Content and a means to deliver (at some as-yet-undetermined date) high speed access and new services.

      As with most ill-conceived mergers of large companies, the big thing was "synergy." If you are unfamiliar with it, "synergy" is the modern financial philosopher's stone that auto-magically turns horseshit into honey. (Look for HP/Compaq to have either horseshit or honey coming out of its ears sometime in the next couple of years -- I suspect you know where my bet is).

      AOL essentially pimped itself so well that it fooled the stodgy old dorks at Time Warner (who feared and still fear that technology will impoverish them) that not only would AOL save them, it would make everyone filthy rich. It didn't. In essence, AOL gave some (not so) magic beans in exchange for the Time Warner cash cows. Time Warner was fleeced. They probably lost more in the stock market bubble than anyone else in the world.

      I wonder if former Time/Warner stock holders feel like idiots for approving the merger.

      What do you think?

      Note: I have no problems with how any of this went down -- everyone involved had smart advisors and lawyers and accountants. Time Warner people aren't sympathetic victims -- they just made a horrible decision about a business that they just really didn't understand, IMHO. I do not consider this to be an indictment of AOL or Time Warner. It's just an interesting story to me.

      guac-foo

  • WHAT?? (Score:5, Funny)

    by teamhasnoi ( 554944 ) <teamhasnoi@nospAm.yahoo.com> on Tuesday October 15, 2002 @10:41AM (#4453650) Homepage Journal
    'AOL was based on the idea that people needed to live in a halfway house while they became accustomed to the Net.'

    I thought AOL was based on the idea that people need a never-ending supply of drink coasters.

    • Re:WHAT?? (Score:4, Funny)

      by Jucius Maximus ( 229128 ) <m4encxb2sw@@@snkmail...com> on Tuesday October 15, 2002 @11:01AM (#4453865) Journal
      "I thought AOL was based on the idea that people need a never-ending supply of drink coasters."

      Drink coasters? How un-creative!

      I chop up my AOL CDs and use packing tape to create a mosaic on the doors of my wardrobe cabinet! If only I had a digicam I would link to a picture of it for you.

      And on that note, my (former) bank once sent me a co-branded AOL cd (with their logo and AOL's logo) and then did a follow-up call a few weeks later asking me about it. I was sure to describe to the girl in great detail why a relationship with AOL dirtied the bank's reputation (this is one of many reasons why they are my former bank). Also, when asked how I used the CD, I described in great detail how I cut it up and used it in my mosaic and she entered it into the records. I wish I could have seen the demographics statistics peoples' faces when they tried to add *that* to a pre-defined category!

    • You've brought up another question. Sure, every one refers to them as coasters - but really who actually uses them to sit drinks on? For me, AOL CD's go from my mailbox to my hand and then directly into the trash. I don't even use failed CDR's for putting drinks on. Who does this? Are there really people in the world that are either 1) too cheap to buy real coasters, 2) have no shame at all and prefer to use CD's than no coasters at all? I'd really like to know.
  • Keyword: CHEAPER (Score:4, Interesting)

    by Faggot ( 614416 ) <choads AT gay DOT com> on Tuesday October 15, 2002 @10:41AM (#4453651) Homepage
    If folks can get a better, faster, cheaper online experience by ditching AOL, they'll do it in a heartbeat.

    Especially now that no one has any money [sfgate.com] to spare on AOL pleasantries like half-assed chatroom censorship and 50% of bandwidth going to ads, AOL is dying. Expect A0L to lose more ground over the coming months... considering their future next to cable and DSL access, for all intents and purposes AOL is dead.
  • not a chance (Score:5, Insightful)

    by dunkelfalke ( 91624 ) on Tuesday October 15, 2002 @10:42AM (#4453657)
    when most non geeks think of aol they think of an "easy internet expirience", although most of them don't even know what internet is. they use aim, they use aol email and they don't want to go any further, hell they don't even know there is more than aol. such people don't care about the speed or price because they don't use it too often.

    as long there are still enough computer illiterate aol will stay.

    and as long as aol funds the mozilla team and winamp, it should stay - it is still the lesser evil.
    • Re:not a chance (Score:3, Insightful)

      by drinkypoo ( 153816 )
      Let us not forget mirrors.aol.com [aol.com]... it's shrunk somewhat over time but still contains info-mac, CICA, and simtel mirrors, among others. It used to include mirrors of linux but I guess they figured out that that was counterproductive. "Hmm, I'll use my AOL CD to get linux installed, and then go get a real ISP..."
  • This may be a last ditch effort to get the AOL side of the business profitable, before splitting back into two seperate companies again. I don't think anyone thinks that this merger was a good idea in the first place.
  • Huh? (Score:5, Insightful)

    by cybermace5 ( 446439 ) <g.ryan@macetech.com> on Tuesday October 15, 2002 @10:42AM (#4453661) Homepage Journal
    AOL was based on the idea that people needed to live in a halfway house while they became accustomed to the Net.

    I though AOL was based on the idea of a super-BBS that people could use, in the days of Prodigy and Compuserve, well before the Internet was remotely available to Joe 486.
    • Re:Huh? (Score:4, Insightful)

      by rkent ( 73434 ) <rkent@post.harvarBLUEd.edu minus berry> on Tuesday October 15, 2002 @11:15AM (#4453988)
      I though AOL was based on the idea of a super-BBS...

      Precisely. In fact, the first experience I had with AOL was when some guy was touting it as "way better" than the local BBS's we were all dialing up to. We thought he was a freak for paying for access. Oh, how times change.

      The article goes on to make the excellent point that this was always the real point of AOL, until it got taken over by MBAs in the mid-late 90s and they started implementing the "herd of eyeballs for sale" mentality In fact, this might be the *real* root cause of AOL's problems: a shift of focus from custom to advertiser, a plummet in the ad rates, and no corresponding reason to stick around.

      Ultimately I think AOL will be doomed even if they can turn it around and create an excellent customer experience, because as much as it's "a halfway house" between people and the internet, it's a full-service one: it takes a lot of resources to maintain community features people like. As they shift to lower-margin broadband connections, I think they'll just be squeezed out. Unless broadband wholesale prices are regulated *way* down.

      As much as I hate to draw the parallel, sites like SlashDot are actually starting to fill the need that AOL used to in this regard, albeit on a smaller scale. Especially with the new friend/foe system and the journaling, all we need is "/.IM" for this to be a full-featured nerd community a-la AOL forums. Of course, slashdot isn't immune from the need to make a profit, and I'm not entirely clear on how they're proceeding towards that end. Guess time will tell. But it seems like AOL might not be a significant part of the picture for much longer.
  • Bad idea (Score:4, Insightful)

    by beleg777 ( 551987 ) on Tuesday October 15, 2002 @10:42AM (#4453662)
    Just because it ceases to be the #1 ISP out there doesn't mean it should die. Perhaps scale back some of the overly wasteful advertising methods and you'll end up with a successful, if not overwhelmingly so, business. Not that I like AOL, but it's just rediculous to think that it has to be top dog or dead. Scale it back, let it stick around as just another ISP, it'll stay in profitable by name recognition alone.
  • by Alcimedes ( 398213 ) on Tuesday October 15, 2002 @10:42AM (#4453663)
    I'm sorry, but that sounds exactly right to me. I still remember when I first went online. It was through AOL. Why? Because they were the only easy way to get online at the time. Any idiot could pull a CD out of their mailbox and be online within hours.

    That was the first instant chat that I'd ever seen. It was a GUI IRC, which has a lot of pluses to it. It was basically the first internet that most people could use without having a whole lot of background in the area.

    Now fast forward 10 years.

    Now you've got everyone and their Uncle working as an ISP. Most companies have usable products to get online. The internet is a much friendlier place, it's pretty, it's readable, not nearly as much tech speak on the pages. It's become another form of TV. (or at least it's trying to)

    The biggest problem is that you don't NEED AOL anymore. They are great to get started, like diapers. Then you grow up and move on. AOL's problem is that less and less people need hand holding to get online, as that's gotten easier. At the same time they face some stiff competition, and the pool of brand new users is drying up.

    They need to figure out a way to get some fresh meat to stock their coffers.
    • by Loki_1929 ( 550940 ) on Tuesday October 15, 2002 @10:48AM (#4453735) Journal
      "They are great to get started, like diapers."

      Are you insinuating that AOL users frequently piss themselves?

      • Are you insinuating that AOL users frequently piss themselves?

        No, I think (s)he was alluding to "what AOL is full of"

        S
      • by hendridm ( 302246 ) on Tuesday October 15, 2002 @11:07AM (#4453919) Homepage
        > Are you insinuating that AOL users frequently piss themselves?

        Only when they see what competitors are charging.

        I just don't get it anymore. I have people coming into the store complaining of poor access speeds through dialup. Fair enough, perhaps dialup is best suited for your need. But then I find out that some of them have purchased a second line. That is when I scratch my head and ask why the hell they are not using cable or DSL.

        Let's do the math:
        Extra phone line ($~20) + ISP fee (~$20) = $40/month!

        Or the alternative: Our town has DSL and Cable Modems priced at $30/month for 384kbit or $40 for 768kbit cable.

        Let's say for a minute that you don't have a second phone line. Fine, but your AOL/MSN/Earthlink account is costing you $22/month for service anyway. Why not pay the extra $8 for broadband DSL or Cable?! It's worth it. Really!

        I also love these people that buy the latest and greatest 2.5GHz computer with a DVD burner and half a gig of RAM only to bring it home and plug a phone line into it. Ugh! What a shame.

        Mmmmmmmm, dialup!
  • This is true... (Score:5, Interesting)

    by dzym ( 544085 ) on Tuesday October 15, 2002 @10:45AM (#4453697) Homepage Journal
    I recently moved to the boonies, where there was no cable internet and I was too far from the nearest CO for DSL.

    What was left to me was AOL, so I signed up for that 1025 hours, and then did some shopping around online for another internet provider... I eventually ended up with a wireless internet service provider that uses the Motorola Canopy [motorola.com] system, which gives me sustained performance comparable to a decent cable or DSL service, plus even more nice things like static IP and RDNS allocation.

    Needlessly to say, then it was "Goodbye, AOL!" ... "The call" was pretty funny to me, since I had (ab)used their service to leap to a competitor. The rep on the other end tried in vain to convince me to keep my AOL account, and even tried to use the argument that "a dynamic ip is good because it's more secure." I got tired in the end and basically told him to cut the crap and just cancel my account.

  • by freerangegeek ( 451133 ) on Tuesday October 15, 2002 @10:45AM (#4453699)
    I'll admit it, I subscribe to AOL. (Internet acces only, of course) As a true geek (tm, perhaps I should be thrown in stocks and pilloried. Truth is there are LOTS of people out there who need training wheels, permanent training wheels. Personally I got deathly sick of [unable to display image] when my AOL friends didn't understand the differenct between embedding and attaching. Now those folks can send me stuff without me having to do lecture on attacments.

    People of my parents generation often don't have the technical understanding to setup and use more complicated solutions. Instead they buy a 'computer as appliance' and slap on M$N (shudder) or AOL, and learn that instead of trying to understand all the layers involved.

    The GUI is challenging enough, let alone configuring the network, setting up IMAP, trying to figure out why the modem script doesn't work, figuring out which ISP to use, and navigating support mazes to figure out what's really wrong.

    What they really want is a way to get connected to their children where they can send pictures, and exchange notes. AOL and MSN, and even Earthlink do that for them as package deals.

    It may not be the cheapest, but they're not poor, and they'd rather spend their time fishing, cooking, and hanging with their friends, than upgrading their DSL driver to version 2.8.
  • AOL has its place (Score:5, Insightful)

    by Chastitina ( 253566 ) on Tuesday October 15, 2002 @10:45AM (#4453702)
    It's long been an easy way for the clueless to get online with a minimum of pain or actually having to learn anything. I definitely plan to get my mother online via AOL so I can pawn her whiny phone calls off on the poor AOL staffers who are paid to deal with the functionally computer illiterate. It's what they're there for. Since there will always be newbies and the terminally cluefree, there will always be a market for products like AOL. It's ultimate niche may not be the massive media-infotainment-merchandising one-stop shop that they've aspired to, but it they focus on their original & enduring strenth, they will remain viable, although much reduced.

    Besides, while they do open the floodgates for any idiot to get online, put up a cheesy webpage, and harass the knowledgeable, they also make it easier to set up filters for my hotmail account. I have all aol.com addy's blocked.

    "C" ;)
  • by Billly Gates ( 198444 ) on Tuesday October 15, 2002 @10:47AM (#4453722) Journal
    I remember using AOL for DOS back when their was no ISP except netcom in my area. Netcom was truly terrible and worse then AOL. AOL wasn't as bad in the early days as it is now.

    Anyway the vast majority of AOL users were idiots and I was truly embarrased by having a @aol.com in my email address when posting to a unix usenet group for obvious reasons. Anyway I switched as soon as the internet boomed and I could finally pick a good ISP. I figured aol would slowly die as the internet became more popular.

    The only true benifit of AOL was that everything was centrally organized and you did not have to search to find specific information. However yahoo now has groups that relate to about ever interest known to man and the search engines have improved and can be catagorized.

    Anyway it seems the only true benifit of AOL is IM and chat.

    The internet is truly a superior platform now and the world runs on it. Its time aol became a portal like yahoo and an isp. THey can no longer have two different online platforms. Its expensive to maintain and the AOL network is the dying platform while the internet is the one thats growing and standard.

  • by namespan ( 225296 ) <namespan.elitemail@org> on Tuesday October 15, 2002 @10:50AM (#4453745) Journal
    Aside from my skepticism about AOL needing saving (since they are the biggest ISP out there, I understand), the challenges they face would be easy to deal with.

    (1) Create a straight PPP dialup product, comes with a modern mail client and web browser (hey! Nescape/Mozilla might work...).

    (2) Charge $5-7 per month LESS than current subscription rates. Yep, $15-$18 per month range.

    So now, they have a streamlined faster product for those who want it, available at a competetive price. Meanwhile, there's still the implication that there is value added for the whole AOL package (which there probably is, speed issues and pop-ups aside), and they can still sell to users who like those features and/or need the training wheels. Simple and appealing. They might even get new users.

    (And anybody who says ??? and PROFIT!! deserves to be the next sniper victim. Don't go there. It's not funny anymore.)
  • by skryche ( 26871 ) on Tuesday October 15, 2002 @10:52AM (#4453768) Homepage
    I convinced my sister-in-law to give up AOL. It costs more, it's slower, and half the people who see your email address assume you're an idiot. (The other half, of course, being other AOL-users)

    So I found her an (half the price) ISP, showed her how to do email, surf the web, etc.

    One week later, "I'm switching back."

    Reason?

    It's not pretty . And she missed the voices .

    I know!

    I am obliged to mention that my SIL is not an idiot.

  • by Josuah ( 26407 ) on Tuesday October 15, 2002 @10:56AM (#4453810) Homepage
    It was never really an Internet company. AOL was based on the idea that people needed to live in a halfway house while they became accustomed to the Net.'...If folks can get a better, faster, cheaper online experience by ditching AOL, they'll do it in a heartbeat.'

    I don't think this analogy is fair. AOL is definitely an Internet company, it's just that their "online presence" is so huge that they can justifiably call themselves their own little Internet (so to speak) even though none of their content is really available to the general Internet community. Hundreds of other Internet companies have tried to do with web sites what AOL has done with their business, namely the ultimate portal. Even the most successful of these attempts (e.g. Yahoo!, MSN, Netscape) has no where near the content, usability, and breadth that AOL has achieved through their proprietary software and business partnerships. No one advertises Yahoo! keyword "The WB".

    I ditched AOL years ago but AOL does honestly have an interface to and navigation context with an enormous amount of general content which cannot be rivaled by anyone else.
  • Define "failure". (Score:4, Insightful)

    by wfrp01 ( 82831 ) on Tuesday October 15, 2002 @10:58AM (#4453833) Journal
    Perhaps shareholders aren't happy, but screw 'em. Why should a company be considered a "failure" if it doesn't rake in gonzo billions? If you can make money, pay your employees decently, and you have happy customers, you are not a failure - despite whatever Wall Street jerky boys in their pinstripe monkey suits would have you believe. How did it come to pass that world domination is our only criteria for success?

  • by Anonymous Coward on Tuesday October 15, 2002 @11:01AM (#4453867)
    That's Funny, Salon trades at .01 and they are commenting on someone elses viability and business plan.

    Steve Case made a brilliant move with Time Warner. He used his hyper inflated stock value to buy a company with real sustainable assets. Sure they have experianced massive deflation, just like ALL internet related stocks. But they now have enourmous resources and infrastructure to leverage.

    AOL is not for geeks, it's for new users, non-techies and grandma's. And there are a lot of Grandma's out there.
  • by kfg ( 145172 ) on Tuesday October 15, 2002 @11:05AM (#4453908)

    http://iml.jou.ufl.edu/projects/Fall2000/McAtee/

    AOL simply finds itself in the position many online services found themselves in with the advent of the WWW, without an actual raison d'etre, and managed, somehow, to reposition themselves as the "hallway" where others failed to do the same.

    So while I believe the author is correct in that they're fighting a battle they will ultimately lose, the premise that they somehow positioned themselves for this is faulty.

    They were originally based on the premise that *ordinary* people would pay for online services, and for a number of years were the *only* such service available to such ordinary people.

    The "Information Superhighway" didn't happen to be built throught their "town," nor was its future existence predictable in the first place. Much as many ghost towns in the midwest were "created" by the particular route the railroad companies happened to pick, such railroad companies not being predictable when the towns were founded a century before on perfectly solid river routes.

    KFG
  • by CreepyNinja ( 615245 ) on Tuesday October 15, 2002 @11:08AM (#4453931)
    Because a majority of the population are not computer savvy. It's a sad fact but true. Slashdot readers are not a fair representation of society. For all the insulting of AOL each one of us likes to throw out there, 10 other people think of AOL as the only way to get online.

    And they are happy with that. Computers are not the end all, be all of life that they are to some of the people here. These other people prefer to go out golfing, take the kids to ball games or whatever, then just come home, take 5 minutes to check email, and then turn off the computer. They are the majority of internet users out there, and they are why AOL will likely never fold.

  • by sssmashy ( 612587 ) on Tuesday October 15, 2002 @11:09AM (#4453937)

    email sent by Robert Hughes, disgruntled Time art critic, to AOLTimeWarner macher Gerry Levin, quoted by Tina Brown: [timesonline.co.uk]

    How can I convey to you the disgust which your name awakens in me begins Hughes to LevinThe merger with Warner was a catastrophe. But the hitherto unimagined stupidity, the blind arrogance of your deal with Case simply beggars description. How can you face yourself knowing how much history, value and savings you have thrown away on your mad, ignorant attempt to merge with a wretched dial-up ISP? . . . I dot know what advice you have to offer, but I have some for you. Buy some rope, go out the back, find a tree and hang yourself. If you had any honour you would.

    Seems like some of the Time Warner employees are feeling some strong emotions about their management's attempt to hitch themselves to a sinking ISP...

  • by pjammer ( 90700 ) <pjammer@livejour ... .com minus punct> on Tuesday October 15, 2002 @11:12AM (#4453962) Homepage
    According to this news story about AOL CD collectors [kmed.com](???), unusual AOL CDs are now selling for more $$$ than AOL stock.

    Be afraid.
  • It's a conspiracy! (Score:4, Interesting)

    by Anonvmous Coward ( 589068 ) on Tuesday October 15, 2002 @11:18AM (#4454011)
    Heh. I just read a few of the posts here. Lotsa accusations of AOL tricking people into giving them money etc. Going back over the last few days, lots of people have really interesting (and false) ideas about how large companies get big.

    Let me give you all a piece of economical trivia: Q.) How does a company get big? A.) A lot of customers pay for a service or product it provides.

    It's true for AOL, it's true for Microsoft, it's true for Starbuck's, it's true for Walmart, it's true for Disney, it's true for the RIAA, etc etc etc.

    Have these companies done less than ethical stuff to get that way? Sure. Whatever. At some point, people still had to voluntarily give them money. At that same point, most had to be pleased with the service or product.

    In other words: You cannot build a business solely on thievery and deceit. You cannot just build a monopoly one day. You cannot just build a coffeeshop next to an existing one and turn on a magic mind beam to make customers zomby-walk into your store. There's something enticicing for them.

    AOL's not everybody's favorite ISP. So what? It does it's job. A.) They make it easy for one to get on the net, B.) They offer a price that seems (emphasize SEEMS) reasonable. C.) They don't make the user feel like it's a huge technical challenge to get up and running. There are better deals out that, but that doesn't negate what AOL provides. They didn't get big by playing games with people's credit cards or manipulating minutes or whatever the other overly-creative people have come up with.

    Just chill. A corp can't get big by being 100% bastard, 30% is about as high as you can get away with.
  • I don't know (Score:3, Insightful)

    by rppp01 ( 236599 ) on Tuesday October 15, 2002 @11:24AM (#4454071) Homepage
    I moved my girlfriend's parents from AOL to cable internet from COX.

    sheesh, wrong move?

    I can't tell. On the one hand, that puke of an app AOL is gone from the system, and they have a snappy connection.
    On the other hand, I have 2 people who call me when they click the wrong area, and the window goes behind Outlook Express, and they can't find it (yeah, I know, minimized, but they don't know that). Ruined my golf game on Sunday (miniture golf, that is ;-) ).

    On AOL, they knew what they were doing. I thought I was saving headaches when they moved over. I don't know about them, but my headaches have increased.

    AOL is still needed. Painful, but true. AOL is nice for users who still don't know what a power button is. I hope it survives as an 'entrance' to the net, and nothing more.
  • by Zeekamotay ( 115667 ) <zeekamotay@NOspAM.hotmail.com> on Tuesday October 15, 2002 @11:30AM (#4454120)
    I run about 1000 websites. Analyzing the logs for all sites combined over the past few years, the drop in AOL activity is pretty staggering. AOL alone used to account for 25% of all our traffic. As of today, it's down to about 8%.

    Jan 1 2000: 24.97%
    Jan 1 2001: 17.08%
    Jan 2002: 12.32%
    Feb 2002: 11.89%
    Mar 2002: 11.41%
    Apr 2002: 11.42%
    May 2002: 11.26%
    Jun 2002: 10.36%
    Jul 2002: 8.22%
    Aug 2002: 10.16%
    Sep 2002: 9.97%
    Oct 14 2002: 8.12%

    AOL is still holding the #1 slot, but not by much. In January of this year, it had a 6% advantage over the #2 spot, now held by attbi.com. Now, that margin is down to about 2.5%.
  • AOL MAIL (Score:3, Informative)

    by Anonymous Coward on Tuesday October 15, 2002 @11:53AM (#4454332)
    Amazingly, nobody has considered the one reasonably positive aspect of AOL... its MAIL.

    "he's off 'is rocker" I can hear as you are now pressing the "reply button" ready to flame me for such treasonous talk. However, I would ask you this:

    for $23.95 a month, does ANY other ISP offer you 500+ mails, each with a 16MB attachment?

    "what do you need that malarkey for" you may ask. Among the obvious statement of "thats how Email service SHOULD BE", there is another reason.

    I make freelance 3D Animations for clients. These files are often huge. Often the clients are computer-unsavvy. Setting up an FTP site is impossible for them - it's all I can do to get them to understand how to decompress a RAR/ACE file... or I will simply send them 16Mb edited versions of the videos I make.

    I cannot afford some special business Email from AT&T or Verizon... especially when AOL's is $23.95 a month. Webbased harddrives are too slow, and depend on a broadband connection - many of my clients are still on 56K modems. But, they all have AOL.

    There is a lot to hate about AOL, to be sure. But they STILL have some wonderful services for the money.... I can't understand why they don't play up their email service, though.
  • YRU Anti-AOL (Score:4, Insightful)

    by gtar ( 617384 ) on Tuesday October 15, 2002 @11:58AM (#4454381)
    AOL... No other ISP has created such a community of people, though it is being emulated in variations with success. And thank God the user community are not all computer geeks (like me) but actually use it to talk to each other about just about anything. No need to be smart about computers. I've seen families use it to stay in touch across the country, friends having a good time in chat rooms. They use it for what it was built for. Face it...AOL isn't only about the corporation... it's about the people who use it. If people pay extra for it, it's because they like the ammenities, the familiarity, the ease of use, and the fact that they find people online that they can actually relate to. Maybe you're just making things easy on yourself by stereotyping thousands of people. If you'd like to see AOL go out of business, tell that to the people who keep it running, the techs who put in the man hours to keep the servers running, the tech support people on the phones everyday, the programmers, the administrators, and the marketing people. Would you like to smile in glee to their face when they discover they've lost their jobs? Would that really make you happy? Bottom line - AOL, Inc. is a business entity but the people who run it are real and want it to be successful based on good merit. And the people who use it could care less if you don't like it because they find in it what they like. If you don't like it, move on. If enough people feel the same way, AOL will get the message and adjust to get people back...by trying to make it better. And it will always be your choice to take it or leave it. Criticism is good if you're trying to build something better. But if all you're trying to do is tear it down, I'd call that envy.
  • by Rogerborg ( 306625 ) on Tuesday October 15, 2002 @12:17PM (#4454512) Homepage
    ... the Mom and Pop ISP user ducks under it.
  • by Cryptnotic ( 154382 ) on Tuesday October 15, 2002 @12:22PM (#4454550) Homepage
    Not if they like the idea of meeting teenagers online for sex. If that's their game, then AOL is the place to be.

  • by aengblom ( 123492 ) on Tuesday October 15, 2002 @12:24PM (#4454565) Homepage
    AOL's roots are in providing "computer network services" to the masses: Simplifying internet services. AOL is still the great at this. However, AOL is massivley deluding itself as to where it should put its effort. How? The early 1990s "online" user is really different from the current "online" user.

    AOL is sinking because it's focus is still getting "technophobe grandma" online. That's messed up. (Hell I'm sure it's still the leader there, but grandma is either online or doesn't care at this point).

    AOL should focus on providing all the services WE AS GEEKS take for ganted.

    • Want 3 computers on your broadband? No problem. We'll HELP.
    • Want power yet easy to use mail support? Done
    • Want to backup to an online storage facility. Click here
    • Want to run a website. Buy a domain. Tie your domain to your aol mail. We're at your service. Click for new services.
    • Everything in .Mac
    • Continue to ad service and build the values (services prodvide) in AOL. Make
    • Run a micro-payment system. Want ads off slashdot? Don't pay slashdot 25 cents. Add 25 cents to your AOL bill. AOL pays slashdot it's monthly earnings from all of its users.
    • Provide premium content. Maybe salon. Maybe ... (ok we know what i'm thinking and it's the real way to save AOL ;-) )


    AOL will work it's ass off to be a broadband provider, but that isn't it's true strength anyway. (It makes things easier for AOL though). AOL is about "value added" and it has to add value for me to pay the "bring your own service" plan.

    That's the only way it will survive.

  • by phriedom ( 561200 ) on Tuesday October 15, 2002 @12:27PM (#4454583)
    Yeah, I see the stock price, and I'm glad that I'm not an owner. If I had owned some Time/Warner I would be irate. I'm not an AOL customer either.

    But they added another MILLION subscribers in the last 9 months. And they project $850 MILLION dollars in positive cash flow in 2003. They have a broadband problem, and it will probably cut into their margins. But they can solve that problem and may retain and continue to add to their customer base. That is a long ways from "You've got bankruptcy!"
  • by PHAEDRU5 ( 213667 ) <`moc.liamg' `ta' `deercsatsni'> on Tuesday October 15, 2002 @12:34PM (#4454668) Homepage
    I haven't finished tiling my office with AOL CDs.
  • by mfterman ( 2719 ) on Tuesday October 15, 2002 @12:42PM (#4454743)
    Or for something else. There are a lot of subscription services on the Internet for various things. Various premimum and subscription-only services.

    Something that AOL could do would be to cut deals with a lot of these providers, to get a discounted rate with these providers. And yes, a lot of these premium services would be very likely to be willing to give a discount in return for the number of potential subscribers AOL could toss in their direction.

    From the customer end, AOL gives discounted rates for various premimum services or even effectively free under the base rate. And they give centralized billing as well for all these subscription services. Just go to a single area and checkmark off what you want and don't want.

    AOL could even offer caching for these services as well, which also benefits both from the provider and and from the customer end. That's probably how they could negotiate a reduced rate "Give us the content at a lower fee and we'll be eating the bandwidth costs on our end". And the AOL customers are pulling this stuff off of AOL servers then.

    Yes, the Internet is all about eliminating the middlemen, but the fact is that middlemen have their uses. Of course I doubt that AOL is going to see this until its too late.
  • Simplify! (Score:4, Insightful)

    by LoudMusic ( 199347 ) on Tuesday October 15, 2002 @12:45PM (#4454773)
    Honestly, this sounds strange, but AOL needs to simplify things. They are known as "The ISP for your grandmother" but I even get confused by their bastard interface.

    And why exactly do they need two instant message protocals? Let one go (ICQ!!) to the OSS community.

    And it would be REALLY nice if they had a "thin client" (might actually exist and I'm not aware) that allows customers to use their pipe without installing all their bloated software. I mean, they are the broadest reaching ISP on the planet.

    ~LoudMusic
  • by tau_bada ( 465512 ) on Tuesday October 15, 2002 @12:53PM (#4454841)
    Is because I write "Return to Sender" on every CD they send to my house.
  • by CPT Carl ( 222361 ) on Tuesday October 15, 2002 @01:05PM (#4454959)
    If I follow this quote from the article correctly,

    "I'm not sending you a file that you listen to later," Kimball says, describing the service. "I'm getting you right now, while we talk. I know you like the Stones, and you're in my life, and as we listen to the song I say, 'Remember the time we went to the concert three years ago?'"

    Is this not a violation of copyright law? Even if the sender own a *legit* copy of the CD and ripped the Stones song, isn't sharing it in digital form illegal since the listener could also save the song?

    Or does this come under the realm of illegal broadcasting? Does the sender need to pay CARP fees? Is this addressed in the article on Webcasting from earlier today?

    OK, so who wants to bring AOL up on charges...
  • AOL will be fine (Score:4, Interesting)

    by supabeast! ( 84658 ) on Tuesday October 15, 2002 @01:15PM (#4455025)
    "If folks can get a better, faster, cheaper online experience by ditching AOL, they'll do it in a heartbeat.'"

    AOL doesn't really seem to be having this problem, given that their user base is up to nearly 40 million people and growing every day. As for broadband competition, most AOL users who go broadband just switch to the "roll-your-own" service that only costs $9.95 a month, and has way less overhead for AOL.

    AOL's real problem at the moment is the loss of advertising dollars that came after the dot-com busts, when companies realized that consumers tend to ignore online advertising, which doesn't really matter in the long run, because all the TW money will offest things in the long run.

    Give AOL a few years for AOL to be absorbed into TW, and for all the idiots who bought AOL at stupid prices to get over their losses, and the company will look just as good as it always did.

    AOL
  • by pimpinmonk ( 238443 ) on Tuesday October 15, 2002 @02:32PM (#4455657) Homepage
    If folks can get a better, faster, cheaper online experience by ditching AOL, they'll do it in a heartbeat.'
    Looks like their marketing campaign is working--you along with millions of others still think that there's no better, faster, cheaper online service than AOL...
  • by TheLostOne ( 445114 ) on Tuesday October 15, 2002 @02:51PM (#4455833)
    From the article:
    It was never really an Internet company. AOL was based on the idea that people needed to live in a halfway house while they became accustomed to the Net.'...If folks can get a better, faster, cheaper online experience by ditching AOL, they'll do it in a heartbeat.

    There is no doubt that this is what aol has become but you are incorrect in how it came about. AOL truly never was an Internet company as you say... but neither was it based on your halfway house idea. This is bullocks.

    It was not started as a buffer for the internet.. it as started without the internet... a subscription bbs. These things really did exist.... The internet killed the BBS.. aol is just hanging on longer then most.
  • by walterbyrd ( 182728 ) on Tuesday October 15, 2002 @02:54PM (#4455852)
    Save untold millions by stopping the flood of aol cdroms, and then lower prices to $15 a month?

    The dial-up ISP I used, access4less.net, only charged $6 a month. Juno charges $10. I think AT&T charges about $14.

    MSN charges $23, but they only get away with that by giving away $400 off the price of new computer.

    So maybe AOL isn't price competitive anymore?

  • by bigdave64 ( 255069 ) on Tuesday October 15, 2002 @03:05PM (#4455945)
    AOL has always marketed itself by encouraging the idea that the internet is a big bad scary place that is full of potential harm and is difficult to navigate. The term "half-way house" used in the post is right on.

    They have been very successful in particular with older, non-technical folks. For example, both my parents and in-laws use AOL and every time I suggest that they could get everything they need on the internet for less money and less hassle by dumping AOL, they look at me like I'm insane.

    What bugs me the most about AOL is that they disguise who their true customers are. They want people to believe that when they sign up for an account, they are the customer. In fact, those poor schmucks are simply fodder for the legions of advertisers and commercial interests that are AOL's true customers.

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