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Technology Stocks : America On-Line (AOL)
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To: RocketMan who wrote (29403)8/13/1999 6:02:00 PM
From: Netwit  Read Replies (2) of 41369
 
Someone at AOL is looking at a spreadsheet that has costs and revenue sources. The question is how much ad $$ per eyeball, how big a % on click through sales, and how much from paid subscription. My hunch--and that's all it is--is that the trend is for the ad $ and % $ to overtake the Subscription $. When does that happen? I don't know; I don't have the spreadsheets in front of me. At some point, they can make it without subscriptions fees or with reduced subscription fees. AOL is a comfort zone for a lot of people who are new to or afraid of technology. I wonder what their demographics are for retirees--what % of the market do they hold. And then the newbies, and then the businesses with turnover. It may be that people will remain willing to pay. I got off of AOL because they drove me nuts with their banners and closed circuit sticky tactics. I went to a local carrier--terrible service and tough transition to the real world, then I went to netcom--great service still tough transition, finally I'm with Pac Bell--lousy service but great bandwidth and I'm past needing the hand holding of an AOL. I think a lot of people won't switch because of the high comfort level--which is part of AOL's strategy. But if they find customers beginning to switch, then AOL will need to eliminate or at least reduce the fees charged for their service. But because of the growth in the other two revenue sources I don't think this is the end of the world for them. The war is won to the player with the most eyeballs at the end of the day who survives. I'm betting on AOL.
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