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Technology Stocks : America On-Line: will it survive ...?
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To: steve lipson who wrote (286)10/11/1996 10:28:00 AM
From: Zoltan!   of 13594
 
I'll accept what you say concerning CUC. But the larger question is whether that story is analogous overall to AOL. I think not.

AOL's growth targets are increasingly seen as chimera. Analysts have reported that AOL suffers a 50% churn each year. An increasing number of AOLer's do not pay at all, they try to cancel but AOL keeps them and their subscriber numbers by giving another 15 hours free.

In fact real profitability may never be achieved, even if the optimistic subscriber growth targets are met. And aggressive accounting will indeed haunt them in that area.

When asked if AOL would ever be able to pay its own way, Cowen's Jeff Goverman said "It is a goal. I'm sure you have goals, too."

Regards
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