Mon, Aug 20th 2007 12:47pm
Last year, in a move that came only six years too late, AOL decided that walled gardens were out and that free web services were in. For a brief period, there was a flurry of news about AOL's attempt to reinvent itself as a Yahoo-like portal. With the walls torn down, the challenge for management was to actually give people a reason to use AOL's services, thus driving up traffic and ad revenue. Simply being free would not be enough to bring people back unless there was a compelling reason. A year later, it doesn't look like the company has accomplished this. Earnings guidance was recently reduced as the company's growth rate continues to lag behind the industry average. As Wall Street gets antsy over its performance, it seems likely that we'll hear renewed calls for Time Warner to just dump AOL and finally wash its hands of the whole affair. AOL's problem is the same one facing Yahoo: it's not Google. The difference is that Yahoo still has a lot of market share and traffic to work with. Both companies have made several acquisitions in the past year or so in an attempt to reinvent themselves, but unless one of them stumbles onto the next MySpace, Facebook or YouTube, it's unlikely that acquisitions will hold the key to a turnaround.
If you liked this post, you may also be interested in...
- Google Hating Mississippi Attorney General Sues Company... With Ammo From EFF
- Software Copyright Litigation After Oracle v. Google
- Hulu Ditches 'Free' Model Without Giving It A Chance To Succeed
- Photographer Learns To Embrace The Public Domain... And Is Better Off For It
- Nintendo Cracking Down On Pokemon Go 'Pirates' Despite The Game Being Free