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Technology Stocks : America On-Line: will it survive ...?
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To: steve lipson who wrote (3910)7/10/1997 8:57:00 AM
From: Thomas C. Donald   of 13594
 
Steve: AOL broke even last quarter while subscription fees averaged $18 per each of 7,000,000 customers. The $18 average suggests that almost all of these customers are accesing AOL via the old dial-up method. If these customers decided to access AOL via the internet (which still gives them access to all of the proprietary services that make AOL what it is), then AOL could lose revenues of as much as $8 per customer per month if it stuck with its current fee schedule. If AOL is forced to drop its fees to those Bill Gates charges for the same thing, AOL could lose revenues of $11 per customer per month.

I did not say that the recent advertising sales would cause this shift. I said that the advertising space being sold was on the internet site, and that that suggested that the advertisers envisioned a shift of customer access to AOL from the old ($18) ways to new ($10 or less) ways. If the advertisers correctly understand these trends, AOL will soon be bankrupt!
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