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To: Frank A. Coluccio who wrote (5440)	2/15/1999 10:10:00 PM
From: Ahda	Read Replies (1) \| Respond to of 29970

Frank from my point of view once you have caught them most of them don't know what they are doing. This give AOL an edge it is not a system i like but it is system that works and walks you through easily. The tack on prices work because people don't question raise the rent in bits and pieces the tenants don't move. Most people care diddly poop about down loading capabilities or speed until they know what it feels like. Big IMHO I have world net and during the week sometimes in the morning to try to get on the net re watching market is difficult . Pure truth.

To: Frank A. Coluccio who wrote (5440)	2/16/1999 1:45:00 AM
From: Jay Lowe	Respond to of 29970

>> why would they avoid the revenues I think T/ATHM look at it differently. They see that each AOL sub is valued at $1,400/year currently (if memory serves) and each sub pays $240/year in fees. Even if T/ATHM can get half the fee basis, they are still leaving 1000% more on the table. They want those subs to switch. They wants the associated revenues. They want the direct marketing subscription base (MatchLogic). They want PnP telephoneers. They want it all ... because ... that's what they do. They don't want to share. Mr T knows sharing. Mr T doesn't like to share. (I think the reasonable potentials for sharing the buildout costs are being lost in the drive to control the maximum number of eyeballs).

To: Frank A. Coluccio who wrote (5440)	2/16/1999 2:08:00 AM
From: E. Davies	Respond to of 29970

Frank, I'd like to reply to you based on my limited understanding of the situation primarily to see if I might generate a response from someone telling me where I might be wrong: If this is not a case of insufficient capacity on their systems, and if it is not a basic contradiction to the modality of cable system architectures to do so, then why would they avoid the revenues that they could be garnering from the lease of spare, or future built-to-suit, capacity? First, of course there is going to be severe limited capacity issues and structural problems with multiple providers as well. The MSO's are going to have to spend big to keep up with the demand for bandwidth. They need to know they are going to get adequate return for that investment. But the problem goes way deeper than that as I understand it. what is so preposterous about these same users forking up a portion of their ISP fee (to be broken out and distributed by the ISP back to ATHM) for the privilege of riding over an MSO's, and then ATHM's facilities? Heres the critical thing. ATHM has already offered to work an revenue sharing arrangement with AOL, Everyone would win, AOL gets broadband and ATHM gets customers. AOL rejected it flat out. AOL & Mindspring and everyone else want to bypass ATHM completely and just deal with the MSO's. What benefits do the MSO's get out of this? Nothing, only confusion. ATHM gets even less. So how will this "open fair & equal" access happen? By regulators deciding how much the MSO's are going to be allowed to charge for access to the lines. Even the regulators have not yet considered that they have no idea how to base the charges, but somehow thats not really relevant right now. Something is unspoken here. It's more likely a diligent dose of recognition on the parts of the MSOs that in short time their bandwidth resources on those segments will very likely not be enough for ATHM's own use, much less for one of its competitors. And also something even more simple than that. Every customer that gets to use TCI's lines to access Mindspring is one customer that ATHM doesnt get and business that TCI (as majority owner of ATHM) loses. Otherwise, there's a whole lot of folks out there who have found permanent homes on other providers' portals who could be adding substantially to ATHM's and the MSOs' treasuries. This is the basic principle driving your comments I disagree with. The number of people willing to pay for broadband at any moment in time will be roughly the same regardless of how many ISP's are fighting for their attention. Just because Mindspring says "we now have cable access" doesnt mean suddenly lots more broadband customer appear. How long will people choose to stay with a dial-up Mindspring vs. a broadband ATHM just so they can keep the Mindspring email address? A while for sure, but not that long. AOL is of course a slightly different situation due to the proprietary content, but you can already get that for $9.95/mo. Eric

To: Frank A. Coluccio who wrote (5440)	2/16/1999 4:40:00 AM
From: Robert Scott	Respond to of 29970

Perhaps the answer lies in the fact that broadband cable is a shared media and so to permit competitors on your network, while it provides revenue, actually hurts your service.

To: Frank A. Coluccio who wrote (5440)	2/16/1999 4:46:00 AM
From: Robert Scott	Respond to of 29970

BTW, for my US Telcom Policy course this term, we have been asked to write a paper (8-12 pages) on the issue of content and carriage historically and in light of the ATT, TCI, @HOME marriage. Should be a fun project.

To: Frank A. Coluccio who wrote (5440)	2/16/1999 9:08:00 AM
From: RocketMan	Respond to of 29970

Frank, you raised some good points. I don't think it is only a structural problem. From AOL's perpective, they do not have a lot of incentive right now to strike a deal with T/TCI/ATHM that might turn out to be not to their benefit over the next few years. Technology issues aside, the fact remains that AOL has 17M subs at $20-some per month, versus one fiftieth of that for ATHM. So to strike a deal right now for an additional 2% in subs, the deal would have to be one they couldn't refuse. Furthermore, AOL is rolling out their BellAtlantic/DSL deal this summer, and by the end of the year will have more "broadband" subs than ATHM. Even if DSL might have architectural problems, might not deliver the theoretical throughout, etc, it will still be a quantum improvement over 56k modems. So AOL has another year or two to see how this plays out, and that is an eternity in internet time.