America On-Line: will it survive ...? Message Board

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Technology Stocks : America On-Line: will it survive ...?

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To: James F. Hopkins who wrote (1711)	2/13/1997 10:14:00 AM
From: Ramsey Su	of 13594

James, a number of posts ago, someone accused AOL of running a ponzi scheme. This is totally incorrect. A ponzi scheme is someone selling nothing while promising and delivering a fantastic yield by using new investor money to pay for the old. AOL is dumping, just like chip dumping in the 80s. In other words, they are selling a product below cost in order to squeeze out competitors, hoping to monopolize the market. IBM and Sears refused to play that game and got out of prodigy. Compuserve probably cannot afford to play that game, tried WOW for a short time, and immediately conceded, leaving AOL to jump off the cliff on their own. Now AOL no doubt controls the market, only to realize that the market is no where near what they think and they are stuck with losing big chunks of money. This is gut check time. If they admit that they made a mistake on their business model and retrench, they may have a chance. If they let their ego get in the way, they can join Apple at the "once upon a time, there was a great high tech company" heaven. Ramsey

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