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Technology Stocks : AOL, now I get it

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To: Richard Vaughn who wrote (281)1/14/1997 9:58:00 AM
From: yard_man   of 496
 
You're right about the early stages of a new industry. The problem is with the current game plan that AOL's chance for success is practically nil, IMO. My prediction: Company will never make a profit from subscribers and will have difficulty growing the advertising part of the business.

Nothing wrong with valuing a Company based on the potential for future earnings and perhaps a lot of folks out there think AOL's got a lot of potential. I just think they are very wrong.

I don't see the Company as well managed or very forward-looking -- as others have said they seem to be reacting to events as they happen. This is especially true of stopping the phony amortization of costs exepended to get additional customers and the new pricing plan which they botched.

Of course, this is not to say that you might not make some money in the short term being long AOL. Real possibility. Such gains come at a hefty risk IMO.

Regards
Barry Hall
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