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

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To: Brian K Crawford who wrote (2503)3/21/1997 7:18:00 AM
From: Zoltan!   of 13594
 
Actually at this point, the U.S. Post Office appears to indicate that it's AOL that hasn't performed, not PTP. Provident Bank of Maryland is suing AOL over AOL's breach and PTP will file shortly. What contrary facts do you have to support AOL's position?

from wired.com

"PTP was a leading player in the Baltimore Empowerment Zone,
part of a $100 million federal program to create jobs in
downtrodden areas of six major cities. But the company's
conflict with AOL - its biggest client - forced PTP to slash its
payroll from some 600 jobs as of last summer to about 40 at
present."

"We're talking about inner-city people who are now going to be
on welfare," said Benjamin Rosenberg, a lawyer representing
PTP. "This is all just a very clever ploy that AOL has used to
create a pretext for not doing what they should be doing."

"Specifically, he charged that AOL encouraged PTP last year to
invest more than $10 million in new factories and equipment to
handle shipment of about 20 million disks a month. At the same
time, however, Rosenberg said the online service was
pondering a switch to flat-rate pricing, making its existing
50-free-hours marketing campaign obsolete."

"When the flat rate was indeed implemented, he said PTP was
left holding the bag for its expansion costs and some $2 million
in outstanding invoices - bills that Rosenberg insisted AOL is
trying to duck by alleging impropriety on PTP's part.

"That conclusion is virtually inescapable in light of what we now
know was the shift by AOL in terms of marketing," he said. "PTP
greatly increased its capacity in reliance on representations that
AOL made in regards to its marketing, at a time when AOL
clearly was contemplating not pursuing that marketing strategy."

"The crux of AOL's allegation, Rosenberg said, centers on the
number of disks shipped on a day-to-day basis. PTP's
documents say one thing. The post office's records say
another. The discrepancy, says Rosenberg, is perfectly natural."

"When you're talking about mailings that go into the millions," he
said, "the post office will weigh the whole thing, deduct the
weight of the container, then weigh one piece to determine how
many pieces they have. It's a very inexact science."

"PTP did not, under any circumstances, falsify any official
Postal Service records," Rosenberg said. "That accusation is
false."

"But AOL's Primrose insisted that it is not normal for post office
records to differ from those of the shipper. "We want to pay for
work that has been done," she said, "and not for work that
hasn't.

"We really did work with this company to resolve the situation,"
Primrose added. "This company clearly has business problems,
but the problems are not AOL's fault."

"At PTP, Hays said it's just a matter of time before the company
goes under. "We've got a 300,000-square-foot facility, which
costs money just to open the door in the morning," he observed.
"If [AOL] lived up to their contracts, we would not be in this
position."

The fact that AOL management deceives and dissembles is well documented.

Anyway, how can you defend sleazy practices by that sleazy organization, AOL?

Are you, too, corrupt or just a determined member of the booboisie? Or merely reflecting your speculation in AOL stock?

For all the rest of us: If AOL succeeds in this, its latest scam, Taxpayers will ironically end up paying through unemployment compensation, welfare and loan guarantees for all those offensive AOL disks that were railed against.

Regards

March 21, 1997
6:32 am

BTW, How about that RICO (racketeering) suit recently filed against AOL?
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