CEO Calls For AOL Paradigm Shift

An anonymous reader writes "The New York Times is reporting that Jonathan Miller, AOL's chief executive, is calling for the effective dismantling of marketing for their dialup service. In a new plan to be presented to the Time Warner board in a couple of weeks, Miller outlines a new direction for AOL which moves towards using advertising as the main source of revenue while offering most everything they have (software, AOL.com email addresses, etc) for free."

Comments

Cancellation?

[imaginaryelf]

You think cancelling AOL is hard when they charge for services?

Think how much harder it would be to "cancel" when it becomes free.

This makes absolutely no sense

[Fubar411]

FTFA: Under the new plan, almost everything AOL offers -- its content, software and AOL.com e-mail addresses -- will be available to any Web user free.

Even my mother who has had broadband for only a year now knows user@aol.com == newbie. She knows better than to pay attention to mails from there declaring "Important, new email virus alert!!!" as these people are still wet behind the ears.

Given the number of CDs AOL has sent out, and the negative response to their bloated dial-up software, I don't think people will be scrambling to aol.com to get their hands on the latest.

So why would anyone go to AOL.com? The article leaves me unconvinced. About the only thing I can agree with is the CEO's statement about it is going to get worse (before it gets better, but there is no guarntee of that)

Re:This makes absolutely no sense

[mbradshawlong]

I don't buy it that one is stuck with his or her first e-mail address forever. I've used the same username for years, but changed domains several times (i.e. joeuser@anydomain.com). I simply send out several mass e-mails to my contacts in my address telling them and reminding them that my email address is changing. I've lost a few contacts along the way, but generally they weren't close contacts anyways.

Paradigm Shift?

[Dryanta]

More like refocusing on what actually makes AOL profitable. We knew this was coming when we saw AOL ad-words on superbowl commercials, and REALLY knew it was coming with the 10% Google aquisition. Can you really blame them for no longer competing in the sub $25/month dialup when FIMUX and muni wi-fi networks easily bring in close to 2X that per month for broadband after taking out TCO?

Just a thought

[Andrew Nagy]

AOL sucks. We all know this. So they think that providing their services for free, in an advertising based model will help them. It probably will. I think it misses the point, though. How many stories have we heard about their terrible support, lacking features, and inability to change with the market? They should probably focus on providing a great product before they make it free. Free crap is still crap.

Re:Just a thought

[clayanderson]

You clearly have not had to deal with AOL's continued poor decision-making over the years.

In the early days, they were actually much better. They made a valuable contribution back then: they made this new 'Internet' thing accessible to the masses. (And back then, it needed the help...when it was mostly a bunch of BBS's.)

But AOL soon lost it. They got exceptionally greedy, for one, evidenced most clearly by the purchase of Time Warner. And they completely lost any and all focus on their customers. For YEARS now, they've been giving the hardsell to anyone who tries to "quit AOL". (I'm sure you've heard the recent phone recording that's been circulating.)

So now, instead of being a great place for newbies to stick a toe in the water, AOL has become a detriment for newbies. AOL complicates the Internet much more than is necessary. In these days of broadband and wireless, most people (even newbies) need to do nothing more than open up a browser and type in an address. There is no need for a fat client to manage the connection.

And AOL's software is a real porker. It's e-mail. It's virus and spyware protection. It's a photo manager. It's a web browser. It's a dozen other little value-added features that AOL has included in a desperate attempt to preserve their user base.

Nice generous gesture, but AOL, of all companies, does not deserve your generosity or trust. They are an ugly, prideful company who fully deserves the fate which has befallen them.

Maybe it's the content?

[Dekortage]

"In May 2006, 14.8 billion pages were viewed on AOL's branded service -- by both paying users and others -- down 27 percent from a year earlier, according to comScore MediaMetrix. In the same period, Yahoo's page views increased by 10 percent, to 38.1 billion."

Here's a clue: try improving the quality rather than lowering the price. Actually, chances are that AOL's stuff isn't that bad (/. bashers aside) but just the fact that it says "AOL" on it gives people a certain predisposition against it. So, a second clue: try honestly rebranding yourself to improve market perception. If McDonald's can do it, AOL can too.

Re:Maybe it's the content?

[Aladrin]

I'm so gonna get modded down for this. -sigh-

I'm not sure exactly how you mean 're-branding', but if you think changing their logo or even their name will make techies think anything but 'newb' when they see it, you're dead wrong.

I think you may also suffer from a perspective problem. Not every person out there thinks of AOL as 'newb-ville'. Most non-geeks actually think it's just a rather large internet service provider that has many 'features' and is very very well known. They have heard jokes about it, I'm sure, but every company out there has its 'haters' and people will make fun of every company. It's just human nature. If we listened to everyone, nobody would ever use any company.

Instead, most people think of AOL as 'safe' ISP that will help protect them from the dangers of the internet. Why is this? Re-branding! They recently went through a major ad campaign that has lasted years and tells people that AOL will protect them from viruses, spam, and other problems. Most of the things they advertised were new services, which is another aspect of re-branding.

This ad campaign didn't faze techies one iota. But the general populace now sees AOL as warm and fuzzy instead of a rabid bunch of fools that has no control over itself. I'm sure there's someone on AOL that isn't a freak, but I haven't met them.

In case you think I'm just talking out of my ass, I should tell you my background. I've worked for many years as a PC Technician. People that come in with problems with AOL don't say 'Get this horrid crap off my computer!' they say 'AOL doesn't work. Can you fix it?' We (sadly) usually just uninstall the latest version and install an old one and tell them not to upgrade because it isn't stable yet. (Always true, fortunately for us.) Even attempting to explain what AOL is never works unless the person is already biased against AOL. After a certain amount of time, you just give up and accept the fact that people believe the marketting. No matter what someone actually knowledgeable says.

So again... Rebranding? Nah, they've already successfully done that. As for whether their 'paradigm shift' is going to work... Well, I doubt it. But that's their decision and anything that hurts AOL is probably good for me.

Wait A Sec...

[somethinghollow]

They are just now relying on ads as their main source of revenue? Back when I used AOL, their ads were pervasive to the point of being annoying. Everyone I know that uses AIM thinks the number of ads are annoying.

So, what they are saying is that it will only get more annoying as they bump off dial-up. Great plan, AOL.

If AOL wanted to swap from service revenue to an ad revenue, they shouldn't have been shoving as many ads down people's throats before the switch.

Re:Simple question

[Millenniumman]

What does "regardless ... or not" mean?

Re:It's AOL...

[couchslug]

Free will get a shitload of subscribers.
Not ME, but there are many, many people who are not going to get broadband wired connections and cannot justify/afford satellite internet. They do spend money and buy stuff. I fix and reload lots of AOLified machines for happy/semi-happy AOL users.
Make it free and you 0wn them.

Re:An ad for every surface on earth

[Kadin2048]

Once the mass of humanity is freed from the need to scramble for scarce necessities...

I think this is a beautiful, but utterly naive sentiment. As society progresses, we constantly change what we define "necessities" to be, so that everyone can never have them.

Consider what was considered the 'basic necessities' for life 100 years ago, and compare it to today. Things that were utterly frivolous luxuries (like air conditioning) not too many generations ago are considered so critical to life today, that if you can't afford it you can sometimes get a government handout. Easy example: electricity.

This is because society defines "necessities" not as 'things a person needs in order to stay alive' (which is surprisingly minimal), but 'things a person needs in order to lead a reasonably average life.' At the same time, people who do have an income constantly strive to exceed that average -- to do better than the people surrounding them. Thus, the "average" bar gets constantly higher.

The net result is that there will never be enough "necessities" for everyone. If the total amount of resources in the world is n, then the amount you'd need to provide for everyone is permanently defined as n+1.