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: Kenneth Lu who wrote (464)	10/31/1996 4:49:00 PM
From: Art Stone	of 13594

<< I am curious how did you arrive at the number of modems needed, would appreciate if you can let me know. >> The generally accepted number in the Internet Provider business is that you can support about 8 "unlimited" accounts per modem before you start having serious busy signal problems. 6.7 million accounts / 8 = 837,500 modems. AOLNet currently has about 170,000 modems (AOL's figures). A shrinking percentage of AOL's traffic is on SprintNet - best estimate I have is that AOL has access potentionally to 100,000 modems on Sprintnet (but has to pay per hour charges). If you want to assume that some accounts will choose to retain the measured time options, or the "Bring your own TCP/IP" accounts, you can lower this modem estimate, but also lower the associated revenue streams.

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