To: 911Turbo who wrote (6067 ) 3/3/1999 11:50:00 AM From: RocketMan Read Replies (2) | Respond to
Yes, LongOnEMC, the two things that concern me are sub fees and broadband. However, this is a concern for every ISP and content provider, and AOL has more opportunities to deal with these issues than others because of their clout. AOL's history has been one of facing tremendous challenges, being counted out by the pros, then coming back and not only meeting the challenge, but establishing a new set of rules. Remember when AOL was charging by the minute, and other ISPs started going to flat montly fees? Everyone was saying that this would be the end of AOL. Well, AOL met the flat fees, and put a lot of their competitors out of business. Then they had to meet the busy signal challenge because of the higher traffic due to the flat fee structure. Again the pros said they were dead. On the contrary, they went out and established a robust network (even though it has flaws), and can now handle 1M customers logged on at once. And on and on.... now it is the low fee challenge, and even free service. First, I think this is a gimmick, because unless you have a huge subscriber base you will soon go bankrupt giving away free service. Don't forget that ISPs still have to buy modems and pay access fees. But if they want to fight that battle against AOL, AOL is in a much better position to lower fees and shift their revenue model to ads and partnerships, something they are doing anyway. Look at the latest deal they are said to be striking with AT&T to provide phone service. Pittman is growing AOL into the next generation media company, and I agree that in the future access fees will have to decline in relation to other sources of revenue, the same as any media company. But access fees will never go to zero, IMHO, not for the long term. Just look at cable fees, you still have to pay a monthly charge plus the cost of premium channels, and these guys have been around for a while. You get what you pay for.
