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I understand that AOL is a frustrating company for bears and no doubt its stock will see a minor correction (10-20%) somewhere down the line but the overall trend will continue to mirror the growth of the interactive industry... UP, UP, UP. If you're hoping for a collapse I think you're an overly optimistic pessimistic. AOL will grow at a fast clip along with the entire interactive industry, period. Except for pure timing trades, where's the wisdom of shorting a company that has a good track record for growth and is the leading consumer brand in a long-term high-growth industry? Sure, AOL faces challenges but I don't see any likely scenarios even close to some of the doomsday predictions proffered on this board. Especially uncompelling are the arguments that AOL's tech is substandard and AOL is competing against the Web (and thus doomed). This is wishful if not outright delusional thinking. Objectively speaking AOL has some very good client, host, and network tech -- it's not perfect but it's much better than they get credit for. Also, AOL has been able to adapt and scale its tech to the needs at hand in the past: there's no rational basis for thinking there is a fatal weakness in this area. As for the Web, I think AOL has done a good job of incrementally combining what AOL does best (navigation, usability, e-mail, IMs, chat, low bandwidth multimedia) with what the Web does best. This has been a winning consumer-oriented approach and what's been called for up to now. Going forward, AOL is as well positioned as any company -- because of its size, experience, and market share -- to deal with the changes that are now reasonably foreseeable such as the continued development of the Web and the gradual phase-in of higher bandwidth connections. Does anyone really rationally believe that AOL is going to drop the ball on these issues? |
