(COMTEX) A: AOL: AOL outlines plans to lead Europe into next phase of Internet growth.
MAR 18, 1999, M2 Communications - AOL Europe will lead the drive to
bring Europe online, announced Company President and Chief Executive
Officer (CEO) Andreas Schmidt at a press conference today. A series of
business and policy initiatives will position the Company to build on
its leadership and accelerate Europe's emergence as an Internet power.
Schmidt stated the Company's ultimate goal was to reach 10 million
households in 2002 with its differentiated online services. It would be
the leading online service in every market it serves and have the
number one combined portal reach in Europe.
To achieve this, Schmidt laid out a multiple-brand strategy under
which AOL and CompuServe will be supported by a unified, efficient
infrastructure and a portal strategy aimed at driving additional
advertising and e-commerce revenues.
In addition, Mr. Schmidt announced an extension of AOL's
unlimited-access pricing policies in key markets, and reiterated AOL's
determination to seek a regulatory environment that would benefit
consumers and build the medium through free and fair competition.
The goals were aggressive but achievable, said Schmidt, given the
success of AOL Europe since its formation in late 1995. "AOL Europe has
invested heavily to build a service offering unmatched convenience,
ease-of-use, member experience and customer support. As a result, we
have connected 2.6 million households in seven European countries. We
employ 2000 European staff to provide local content and customer
support services and have created one of the best performing networks.
In Europe alone, our network carries over 7 million emails daily and
over 55 million Instant Messages daily."
"Now, AOL is poised to lead Europe into the next stage of mass-market
growth and acceptance, driven by our superior value and a powerful
growth strategy based on a tested business model," Schmidt continued.
"At the same time, we will continue to push for policies and a business
environment that will allow Europe to realise its potential as a
competitive, modern 'Net-centered' economy."
Multiple-Brand Strategy Capitalizes On Company's Unique Strengths
Across Europe
Under the multiple-brand strategy announced by the Company today, AOL
and CompuServe will remain separate brands but will be served by
combined business support functions.
AOL will continue to serve the mass-market home user, while
CompuServe will increasingly be focused on vertical business and
professional audiences. AOL will invest aggressively in marketing
behind the two brands to further build their respective market shares.
New Portal Strategy to Drive E-Commerce and Advertising Revenues The
Company also announced a new portal strategy aimed at giving the
company a significant additional share of the projected $2.77 billion
in Internet advertising revenue in Europe by 2003. Parallelling the
successful model of AOL.COM and CompuServe.com in the U.S., planned AOL
Center and CompuServe Center portals will serve the distinct market
segments established for the two brands. The portals will run on a
unified technical platform, based on Netscape technology, and will
feature ecommerce, advanced search facilities, email and a strong focus
on local market content. AOL and CompuServe's powerful communications
tools, including Instant Messenger and NetMail, will also be
integrated.
Unlimited Access Plans to Be Extended As AOL Renews Calls to "Turn
Off the Clock"
Mr. Schmidt announced that AOL's unlimited pricing plans will soon be
available to even more members in Europe. The unlimited usage price
model that has already been successfully implemented in France and the
UK will soon be extended to Germany and to other markets the Company
enters.
Citing the US, where usage increased dramatically with the
introduction of flat-rate price plans, Mr. Schmidt commented. "By
turning off the access clock we can start to change the online
behaviour of our members and enable them to embrace this medium as a
central, daily part of their lives."
At the same time, Mr. Schmidt reconfirmed his commitment to fighting
the obstacles that prevent consumer choice and keep call charges
artificially high in Europe. "To accelerate Europe's emergence as a
leading Internet power, we must stop the clock-based charging that has
driven up costs for consumers and slowed the development of the medium
here," he said. "AOL supports the actions of many of the consumer
advocacy groups in this area and will continue to keep pressure on the
dominant suppliers in our markets to stop the practice of metered
billing."
Schmidt pointed out that European telecommunications costs are
approximately five times higher than in the United States. With the
present framework, by 2001 the U.S. will have more than three times the
Internet penetration rate of Europe (40% versus 13%), despite Europe's
largest overall population and economy. Schmidt cited a recent Jupiter
Communications report that 41 % of households who were not using the
Internet would be "likely to go online" if per-minute phone charges
were dropped.
Initiative to Connect Politicians Across Europe
To highlight these policy issues and increase policymakers' awareness
of the interactive medium and its value to people's lives, Mr. Schmidt
extended an offer to connect all of Europe's parliamentarians to AOL
Europe online services. He commented, "This is a cross-border medium.
All politicians, regardless of country or party, should have the same
opportunity to access, explore and use online services in the same way
as their constituents."
AOL Europe was formed in late 1995 as a joint partnership between
America Online Inc. and Bertelsmann AG, Europe's largest media group.
From the first service launch in 1996, it has grown from 0 to 2.6
million households in just over 3 years, making it the largest
pan-European Internet online service, serving a total of almost 8
million users. AOL Europe manages all of AOL's and CompuServe's
European services in 12 operations across 7 countries and employs
almost 2000 people, including close to 1400 in customer services roles.
Members of each European service enjoy AOL's traditional ease of use,
convenience, unique content and seamless Web connections, combined with
special local features, language, content, billing and customer
service. AOL Europe is committed to the same multiple-brand strategy
successfully developed by AOL in the US. AOL is the service for the
whole family, providing its members with interactive entertainment,
information and education services while giving access to a global
online community. CompuServe is aimed at the corporate customer and
professional user offering specialized information, large-scale
databases, matchless forums and professional communication tools.
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