>> But in net, in the long term, if aol keeps way ahead of everyone
>> in member #s ....... eventually they win ... even if you and I
>> (and aol) aren't smart enuf yet to figure out exactly what the
>> business model will be.
>>
>> ...and now we're going to have a big holiday period of
>> computersales ... all w/aol "ready to go" on every computer....
>> soon there will be so many aol members that Coke will sign up
>> and then ......
>>
>> Sorry folks but the profits are irrelevant for a while yet.
I don't buy it. There are 300 million people in the US, I estimate at least 20% is on the net in one way or another. "On the net" means to have access to email and web browsing. It could be thru work, school, ISP, or AOL. That's 60 million people. AOL's 9 million is only 15% of that population. If the net population is higher, AOL's portion is even less significant.
The new member sign-up rate is slowing. Here is why. The initial hype of Internet is over. New users will have to come from people who lost free Internet access from previous source. The biggest potential group of new users is college graduates. But most of them will find access thru work. On the high school front, most students already have access thru school. They may have AOL at home as a hobby if they are computer savvy. And when they graduate, they go to college and get free access there. The non-college bounded half most likely are not computer savvy and don't care about the Internet, or again, find access thru work. The end result is slower subscriber growth.
AOL access is ISP plus content. The content component is becoming less significant in comparison to Yahoo, CNN, WSJ, and USAToday. In the long run, AOL will becoming more like an ISP, competing with hundreds of ISP's, including giants like AT&T, MCI, PacBells, and MicroSoft. AT&T and GTE can offer phone and ISP service in one bill. MSN is already installed in all new computer running Windows95 just like AOL. Facing these competitions, how can one be sure AOL will still be #1 in the future? (AT&T had 80% market share and lost it, AOL only has 6% right now assuming eventually 150 million needs home ISP connection).
Lastly, if AOL can't make money with 9 million, they can't make money with 90 million. Simple as that.
Yikes |
