Hector,
1) You say that adoption of DSL service will increase subscription growth much faster than estimated. Actually, it is much more likely that broadband technologies of any kind will be used mostly by existing AOL customers, a cannibalizing effect. As I mentioned in a post the other day, DSL and other broadband technologies are like HDTV to a TV station, something very expensive that they have to have to stay competitive. There is not a long line of new customers just waiting for AOL to get DSL to sign up. The number of new subscribers, as opposed to subscribers cannibalized from the existing AOL customer base, will probably be much less than you anticipate.
2) AOLTV will only be of marginal interest (see webTV as an example of a flop) until the bandwidth allows, say, downloading or streaming on-demand movies.
3) The AOLPC is actually quite a good idea. Whether AOL gives away the PC for a commitment of a fixed subscription to AOL or sells an AOL subscription and PC bundled, anyone who goes for this is a captive of AOL and has to buy an entirely different PC to switch to a different service. In addition, since subscribers are worth something in market cap (I've seen $5000 but that number is much too high, figure $1000 for a conservative number) spending $100 to buy $1000 is not a bad investment, though how many people will go for a non-windows dedicated PC is hard to guess. AOL could also set up the PC to advertise even when off line, then update the ads when it goes on line!
Best,
--Steve |
