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Technology Stocks : COM21 (CMTO) -- Ignore unavailable to you. Want to Upgrade?

To: jeff greene who wrote (619)	6/24/1999 3:45:00 AM
From: Jay Fisk	Read Replies (1) \| Respond to of 2347

New spin on AOL and broadband - excellent source: thestandard.com AOL today argues that cable cannot ignore its huge customer base. At an October 1998 conference sponsored by investment banker Volpe Brown Whelan, AOL's CFO Michael Kelly reprised the party line: "AOL will drive acceptance for broadband." That same month, CEO Pittman told Adweek, "Over the next five years, we'll pay $10 billion to some third party for connectivity. If you are either cable, wireless or DSL, we will give you the money to make your investment up." Sounds logical. Yet not a single cable operator has yet seen it that way. Why? Cable smells blood. It appears that AOL's stickiness and subscriber loyalty doesn't hold up well against broadband. AtHome claims that 66 percent of its subscribers come from AOL. Meanwhile AOL says that 22 percent of broadband subscribers also subscribe to AOL's $9.95-per-month "bring your own access" plan. Even if At-Home's 66 percent includes AOL's 22 percent, the hit to AOL is substantial. Cable's resistance is emboldened by the prospect of advertising and e-commerce opportunities. If cable continues to be allowed to program its data channels as it programs video ones, cable can secure premier placement for its own ad and commerce initiatives; from default portal to services developed by cable specifically for broadband.