Re: Some news that may affect AOL:
biz.yahoo.com;
Actually QWST is targeting MSFT. (credit Pruguy for this information)
Microsoft, like may of the free-services providers including Juno Online, must first reach the customers, second incent them to switch, and third, create compelling vehicles to retain their interest and attention. While the use of an E-Mail identity has long-been considered the sacred-cow of customer retention, increasingly, the E-Mail id is not enough. Users want content, entertainment, information and a definition of "their space." We understand that the term for
creating such patterns and actions is called "habituation" and, like AOL, Microsoft will have to spend tens, if not hundreds of millions of dollars to reach and retain audiences.
Doing so will, we expect, require the company, which has recently divested one of their core content assets "SideWalk" to TicketMaster-City Search will, at a minimum, have to create a compelling set of services for their consumers. Of course, making such an effort financially viable on a stand-alone basis (the same basis on which
AOL, Excite@@Home, and others are measured) will be important and one we would be surprised to see Microsoft reach quickly. While MSFT has ample resources to fund and promote the development of an "AOL Killer" we note that the ability to effect success in the market will prove challenging.
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