AOL Having Trouble Wooing Broadband Customers

Overhype

from the gee,-I-wonder-why... dept

Yet another article pointing out that AOL is having trouble convincing people to sign up for broadband offerings. This has been covered before and still isn’t surprising. There are a bunch of reasons for it – and almost all of them have to do with shortsighted management. First, AOL makes more money from dialup subscribers, since they get everything. With broadband, AOL has to pay the broadband provider some cash. So, they haven’t been able to embrace the high speed offerings with much gusto. Of course, this is bad business thinking since their customers will embrace it – and if they can’t get it through AOL, then they’ll get it somewhere else entirely. The second problem is the ridiculous and amazingly costly politics within AOL-Time Warner. The fact that AOL and Time Warner Cable’s RoadRunner have not been cooperating on an offering since day 1 is a disaster that people deserve to be fired for. All this results in AOL offering insanely expensive broadband options that offer little of additional value to the customer. And people wonder why they’re having difficulties signing up customers? Update: Here are two interesting and related stories (both from the NY Times). The first is an article as to how Comcast has accidentally become a huge broadband internet provider whose revenue and profits are likely to trail only AOL by the end of the year (passing Earthlink and MSN). The second is how Microsoft is quietly shifting their MSN strategy away from being an AOL killer, and more towards being a software player and partnering with broadband providers to offer MSN. They’re already doing so with Qwest and will soon start with Verizon as well. Given AOL’s struggles, this makes a lot of sense. Of course, I still wonder why anyone needs any sort of required “portal” front end anyway. I just want my internet connection to let me go wherever I want to go.