AOL A Media Company? Get Over It!
from the it's-all-about-the-technology dept
An interesting opinion piece saying that AOL’s problems stem from the fact that they haven’t realized they’re really a technology company, and not a media company. They act like a media company, and that’s making them lose ground to companies that realize they’re technology companies. As an example, the writer talks about how Amazon and Google have opened up their APIs so that other companies can use them. AOL, however, has kept its interface closed, and charge lots of money for companies to get access. The argument for doing this is clear: they want the money. But, the long term strategy is dangerous because it marginalizes AOL. Suddenly, it’s less important to get tied in with AOL when you can do it for free with Google or Amazon. There are also a few other examples of where AOL has worked hard to remain proprietary due to their mindset as a media company, which is killing them on the technology side, and making partners and customers less willing to work with AOL.
Comments on “AOL A Media Company? Get Over It!”
No Subject Given
They are a media company and always will be as long as they “mediate” content, commerce and services to the mass market. Technology is just an ever evolving set of tools to power that mediation. They are not stupid to be a technology oriented player when their bottom line comes from mediation. And why would they offer APIs to their services when such can only dilute their monetization achieved with a closed system.
Re: No Subject Given
What if, by keeping them closed, they start losing business? It’s the same argument that applies to Hollywood and everyone else who freaks out at the idea of an open service.
Go ahead and leave your services closed and protect your revenues. Just don’t go crying foul when others come along and offer open services and you lose all your business.
Re: Re: No Subject Given
I understand your point but open services cause commoditization and lower profits. Fortunately for them they own a considerable amount of top tier content & services which still keeps 10% of America online via their service. In such position they can risk being closed for as long as possible. Their true competitor MSN is really following the same route with closing off certain content to premium subscribers. Why? Cause it makes economic sense.
Re: Re: Re: No Subject Given
Right, but the article is suggesting that it’s not going well for AOL, which can be shown by them losing commerce partners and such…
I guess the real question is how long can they hold onto that position by not being open. Once the tide turns, it’s dangerous to be remembered as the player who kept everything closed when everyone else is enjoying the fruits of an open system.
My point is that the strategy you propose makes short term economic sense, but is dangerous long term strategy.
Re: Re: Re:2 No Subject Given
AOL is not doing good cause they still need to digest the merger with Time Warner successfully and they are too slow to adapt internally to the changes necessary to capture new advertising dollars, plus they made some bad bets. I do not believe any smart commerce partner would want to leave such a high market share of consumers.
You are right, this strategy may be dangerous in the long term but if they need to they can always open up if subscribers started jumping overboard in large numbers (doubtful).
Re: Re: Re:2 No Subject Given
“Once the tide turns, it’s dangerous to be remembered as the player who kept everything closed when everyone else is enjoying the fruits of an open system.”
Indeed. One fine example comes to mind: Sony’s Beta. And many to this day believe Beta is superior to VHS. But pretty much everyone – including their own subscribers – is in agreement that AOL sucks. America Online may have acquired a bazillion members through their carpet-bomb marketing, but do you know *anyone* who has finally left AOL who’s sorry they did? I’d love to know what sort of membership churn goes on.
No Subject Given
Who cares? AOL bites. I like it when they hurt themselves.
Discrimination
AOL dupped me by offering me service with out credit cards or debit cards. they said I could charge it on my phone line so I did…..DUHOOOO! Now I can’t access my name change or use chat which was one of the require those cards to “verify my age” although they can use my password or “secret question “to log mr on or verify me on yhe frequent cakks I makr to them to complain…….(crappy service)
Discrimination
AOL dupped me by offering me service with out credit cards or debit cards. they said I could charge it on my phone line so I did…..DUHOOOO! Now I can’t access my name change or use chat which was one of the require those cards to “verify my age” although they can use my password or “secret question “to log mr on or verify me on yhe frequent cakks I makr to them to complain…….(crappy service)