Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Technology Stocks : AT&T -- Ignore unavailable to you. Want to Upgrade?

To: Jeff Hayden who wrote (2708)	7/26/1999 12:36:00 PM
From: Mark Palmberg	Read Replies (1) \| Respond to of 4298

Interesting, Jeff. Do you read TheStreet.com? Check out this excerpt from a story today about AOL's latest screwup with their instant messenger: This kind of nonsense by AOL isn't fatal by any stretch of the imagination. It's not like announcing a bad quarter after you've pumped the analysts, or like Steve Case announcing he's come to believe most technology inventions were brought to us by little men from space. It won't send the stock into a 25-point tailspin. But it is a stupid thing to do, something that screams to the world that in spite of its 18 million-plus AOL members, the 46% jump in its most recent quarter's revenue, the billion-dollar year just concluded ... America Online STILL DOESN'T GET IT about the Web. With so many ISP's out there, paying AOL for the hassle of having to wade through their crappy software just to get on the Web seems like a very, very foolish thing to do. Mark

To: Jeff Hayden who wrote (2708)	7/26/1999 1:25:00 PM
From: lml	Read Replies (1) \| Respond to of 4298

I don't think AOL is as concerned with getting new customers as they are with losing the customer base they have. Jeff: The drop in the rate of new customers is where AOL is particularly vulnerable over the longer term, which has the potential to impact its stock price immediately. Check out AOL's churn rate -- the rate of new subscribers vs. the rate of existing subscribers who leave AOL in favor of another ISP. AOL must maintain a modest growth of new "netters" or growth in its subscriber base will begin to slow & ultimately contract. I presume you know what this will mean to its stock price. The big risk to AOL is manifested by ATHM's position on the cable platform. There are many potential AOL subscribers out there who have yet to sit down in front of a PC & get on the Net, or online service. This market is most likely characterized by TV viewers, which is why AOL has pursued it venture with DirecTV in addition to its DSL partnering strategy. But consider ATHM's position in this "new" subscriber market. By offering Internet access over the co-axial jack in the home, that connection is most likely going to be in the same room as the TV, although it does not have to be. IMHO, cable access will introduce the PC into the TV room where it has not necessarily existed before because of phone jacks throughout the house. These TV-oriented "newbie" subscribers are going to be natural targets of ATHM service, which is an obvious threat to AOL's need for new subscribers.