Glenn,
Another view of some of the information presented:
Usage continues to increase and is now at an average of 51.5 minutes/day/sub, up from 41 minutes in Dec.
This means their costs of revenues will be up 25%, as they pay by the hour for their user's connection time. This is a mixed blessing for AOL, and IMO one of the main reasons they raised their rates recently.
22MM e-mails are sent per day to 70MM recipients.
How much of this was spam?
In calendar 1997, e-commerce revenues were close to $360MM.
Uhh, I think they need to read the 10-Q's a little more closely. There was $360MM in other revenues in CY97. But other revenues included ANS revenues, which are NOT e-commerce revs. This is just plain wrong.
The Tel-Save deal is going well as 200,000 customers have been signed in a relatively short time.
Going well according to whom? If I remember correctly, Tel-Save needs at least 1 - 2 million customers from AOL to conclude that their promotion was a success. They signed up 100,000 lines in the first 2 weeks, and another 100,000 lines in the next month. If the time it takes to sign up 100,000 lines keeps doubling (after all, if someone wants this program, they've already had plenty of chances to sign on by now), it's going to take over a year to get to 1,000,000 lines, which would not be successful. This will only be more difficult now that MCI has introduced a competitively priced service.
Ted indicated that the $2/mth price increase in subscriber fees to $21.95 is going well. There appears to have been no big changes in churn.
Well, since the price increase hasn't even taken effect yet, is it really a big surprise that no one has quit the service as a result of it? I think the bigger issue here is what affect the price increase will have on new subscribers, especially given targeted advertising by AOL's competitors.
We believe AOL is well positioned whatever way technology goes.
I think technology is going towards open standards such as HTML, but AOL remains a proprietary, closed system. I don't see why they're well positioned.
AOL created Love@AOL for next to nothing and it has become quite successful.
Sure, but how about all the failed content projects? They've spent enough money in this area that some of their projects were bound to succeed, but is Love@AOL the exception or the rule? What about the recently announced layoffs in their entertainment content project? I guess that one wasn't created for next to nothing, and isn't "quite successful". |
