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Technology Stocks : America On-Line: will it survive ...? -- Ignore unavailable to you. Want to Upgrade?

To: The Duke who wrote (8473)	3/4/1998 5:47:00 PM
From: AAC	Read Replies (1) \| Respond to of 13594

Intel reported weaker than expected OEM demand, revised first quarter to 10% decline in revenue, profit of $0.70 per share from expected $0.93. Also from the Wall Street Journal - Interactive Edition, (see below) after the close today. These two developments combined should give AOL some serious downside pressure. Good Luck! AOL's Rate Hike Gives Rivals Marketing Opportunity By Johanna Bennett NEW YORK (Dow Jones)--When America Online Inc. (AOL) unveiled plans last month for a 10% fee hike, US Internet saw a golden opportunity. About a week later, the Minnesota-based Internet service provider had a World Wide Web page up and running that promised to waive sign-up fees for AOL customers and offered a new toll-free telephone number, 1-888-LEAVE-AOL. Since then, Internet service providers have raced to kick off advertising campaigns designed to lure disgruntled customers away from the on-line giant. Using slogans like "Get Out Of AOL Free" and "1-888-QUIT-AOL," companies like Prodigy, Mindspring Enterprise Inc. (MSPG) and Earthlink Network Inc. (ELNK) are offering AOL users incentive packages that promise cheaper rates, free sign-up and even automatic change of e-mail notification if they switch carriers. "We are going to take it for what it's worth," said Joe Caldwell, vice president of sales and marketing for US Internet. As the nation's largest Internet provider, with 11 million customers, America Online is frequently the target of marketing campaigns by competitors trying to break its stranglehold on market share. Last month, AOL rivals found a chisel when the company announced that a massive restructuring plan would include hiking the monthly fee for unlimited access this spring from $19.95 to $21.95. The additional money was needed for networking costs, company officials said. Within a few weeks, companies like Earthlink, Mindspring and US Internet, to name a few, moved up planned advertising campiagns and redesigned them to capitalize on the brouhaha surrounding AOL's announcement. "We were planning to do a campaign anyway. But AOL managed to provide us with a better opportunity to launch ours," said Howard Lefkowitz, vice president of business development for Earthlink, among the largest ISPs, with 500,000 subscribers.