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

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To: Dick White who wrote (691)11/24/1996 11:21:00 AM
From: Todd Daniels   of 13594
 
from AOL Q1 1997 10Q SEC filed 11/20/96

"While the Company expects high-margin other revenues will increase,
and expects that the growth and management of AOLnet will provide
lower per hour data communication costs, it is anticipated that these
factors will be more than offset by an increase in the total usage
hours, primarily as a result of the introduction of flat-rate pricing."

Also:

"The Company leases the majority of its facilities and equipment under
noncancelable operating leases, and as part of its network portfolio
strategy is building AOLnet, its data communications network. The
buildout of this network requires a substantial investment in
telecommunications equipment, which the Company plans to finance
principally through leasing."

IOW, AOLnet isn't nearly the `asset' some might think -- ditto
impact on reducing operating margins.
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