Ed,
You comment to Hector, The key for AOL is the number of new subscribers and revenues, especially from E-commerce and advertising.
I couldn't agree more. Last quarter, for the first time, the percentage of revenue contributed by E-commerce and advertising actually grew, moving to about 20%. Previously, "other income" had come out about the same percentage of total revenues quarter after quarter, meaning AOL could only grow by adding subscribers but last quarter that high margin "other income" went up. Personally, I would like to see E-commerce and advertising amount to between 20-25% of the total. AOL always fiddles the presentation of the number by saying advertising and E-commerce grew some enormous percentage, but, to repeat, the more important number is advertising and E-commerce as a percent of total revenues, an indicator of future growth above mere linear subscriber growth.
Best,
--Steve |
