AOL
Webpages concerning "AOL"
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Wikipedia-Article "AOL"
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| Type | Subsidiary of Time Warner |
|---|---|
| Founded | 1985 |
| Location | Dulles, Virginia |
| Key people | Jonathan Miller, Ted Leonsis |
| Industry | Internet & Communications |
| Products | ISP |
| Revenue |  $8.7 billion USD (2004) |
| Operating income | {{{operating_income}}} |
| Net income | {{{net_income}}} |
| Employees | Unknown |
| Website | www.aol.com |
| {{{footnotes}}} | |
America Online, or AOL for short, is a U.S.-based online service provider, Internet service provider, and media company. Based in Dulles, Virginia, a community in Loudoun County, Virginia, with regional headquarters installations in many cities around the world, it is by far the most successful proprietary online service, with more than 32 million subscribers at one point in the US, Canada, Germany, France, the United Kingdom, Latin America (declared bankrupt in 2004), Japan and formerly Russia. In early 2005, AOL Hong Kong stopped its service. In the fall of 2004, AOL reported total subscribers had dropped to 24 million, a drop of over a quarter of its subscribers.[1] In late 1996, AOL suspended all dialup service within Russia in the face of massive billing fraud, forcing the company into a rare case of full market retreat.
For many Americans through the mid to late 1990s, AOL was the Internet, but the rise of high-speed Internet access from cable and telephone companies as well as the increasing sophistication of the public in handling browsers and other Internet utilities has cut into its user base. In 2000 AOL and Time Warner announced plans to merge, and the deal was approved by the Federal Trade Commission on January 11, 2001. This merger was primarily a product of the internet mania of the late 1990's, known as the internet bubble. The subsequent massive decline in value of stocks such as AOL resulted in much recrimination over the merger.
News reports in the fall of 2005 indicated a renewed interest in buying out AOL. Suitors such as Microsoft, Google, Yahoo and Comcast have had discussions with Time Warner about a possible purchase, and on December 16, 2005, Time Warner and Google announced that they were starting exclusive talks for Google to purchase $1 billion in AOL stock, a 5% share.
Although its dialup market is shrinking as more members switch to high-speed services, the success of its AOL for Broadband program has helped it to maintain members that would otherwise totally drop the AOL service. This combined with its growing advertising revenue through its relationship with Google, AOL collected 8.7 billion US dollars in revenue for 2004.
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History
AOL began as a short-lived venture called Control Video Corporation (or CVC), founded by William von Meister. Its sole product was an online service called Gameline for the Atari 2600 video game console after von Meister's idea of buying music on demand was rejected by Warner Brothers. (Klein, 2003) Subscribers bought a modem from the company for $49.95 and paid a one-time $15 setup fee. Gameline permitted subscribers to temporarily download games and keep track of high scores, at a cost of approximately $1 an hour.
In 1983 the company nearly went bankrupt, and an investor in Control Video, Frank Caufield, had a friend of his, Jim Kimsey, brought in as a manufacturing consultant. That same year, Steve Case was hired as a part-time consultant; later on that year, he joined the company as a full-time marketing employee upon the joint recommendations of von Meister and Kimsey. Kimsey went on to become the Chief Executive Officer (CEO) of the newly-renamed Quantum Computer Services in 1985 after von Meister was quietly dropped from the company.
Case himself rose quickly through the ranks; Kimsey promoted him to vice-president of marketing not long after becoming CEO, and later promoted him further to executive vice-president in 1987. Kimsey soon began to groom Case to ascend to the rank of CEO when he himself retired, which Case did in 1991.
Kimsey changed the company's strategy, and in 1985 launched a sort of mega-BBS for Commodore 64 and 128 computers, originally called Quantum Link ("Q-Link" for short). In May 1988, Quantum and Apple launched AppleLink Personal Edition for Apple II and Macintosh computers. After the two companies parted ways in October 1989, Quantum changed the service's name to America Online. [2], [3] In August 1988, Quantum launched PC Link, a service for IBM-compatible PCs developed in a joint venture with the Tandy Corporation.
In February 1991 AOL for DOS was launched using a GeoWorks interface followed a year later by AOL for Windows. In October 1991, Quantum changed its name to America Online. These changes coincided with growth in pay-based BBS services, like Prodigy, CompuServe, and GEnie. AOL discontinued Q-Link and PC Link in the fall of 1994.
| AOL release timeline | |
| 1991 | AOL for DOS launched |
| 1993 | AOL for Windows launched |
| 1994 | AOL 2.0 launched |
| 1995 | AOL 3.0 launched |
| 1998 | AOL 4.0 launched |
| 1999 | AOL 5.0 launched |
| 2000 | AOL 6.0 launched |
| 2001 | AOL 7.0 launched |
| 2002 | AOL 8.0 launched |
| 2003 | AOL 9.0 Optimized launched |
| 2004 | AOL 9.0 SE launched |
Massive growth
Case drove AOL as the online service for people unfamiliar with computers, in particular contrast to CompuServe, which had long served the technical community. AOL was the first online service to require use of propreitary software, rather than a standard terminal program; as a result it was able to offer a graphical user interface (GUI) instead of command lines, and was well ahead of the competition in emphasizing communication among members as a feature.
In particular was the Chat Room, which allowed a large group of people with similar interests to convene and hold conversations, including:
- Private rooms — created by any user. Hold up to 27 people.
- Conference rooms — created with permission of AOL. Hold up to 48 people and often moderated.
- Auditoriums — created with permission of AOL. Consisted of a stage and an unlimited number of rows. What happened on the stage was viewable by everybody in the auditorium but what happened within individual rows, of up to 27 people, was viewable only by the people within those rows.
Under Case's guidance, AOL committed to including online games in its mix of products even when it was only a Commodore 64 service. It hosted the first Play by email game from any service Quantum Space (1989-1991); the first graphical online community (Club Caribe from LucasArts); and the first graphical MMORPG, Neverwinter Nights from Stormfront Studios (1991-1997).
AOL quickly surpassed GEnie, and by the mid-1990s, it passed Prodigy (which for several years allowed AOL advertising) and CompuServe.
Originally, AOL charged its users an hourly fee, but in 1996 this changed and a flat rate of $19.99 a month was charged. Within three years, AOL's userbase would grow to 10 million people.
AOL was relatively late in providing access to the open Internet. Originally, only some Internet features were accessible through a proprietary interface but eventually it became possible to run other Internet software while logged in through AOL. They were the first online service to seamlessly integrate a web browser into content.
AOL introduced the concept of Buddy Lists, leveraging their one-on-one instant messaging technology.
In recent years, its traditional dial-up service has been declining in subscribers and popularity. In an attempt to combat this, the AOL for Broadband service, which delivers AOL content and chatrooms but no Internet access to users who have an existing high-speed Internet connection, was launched, but in 2004 the company pulled back from this plan.
Since its merger with Time Warner, the value of AOL has dropped from its $200 billion high and it has seen a similar losses among its subscription rate. It has since attempted to reposition itself as a content provider similar to companies such as Yahoo!. In 2005, AOL broadcast the Live 8 concert live over the Internet, and thousands of users downloaded clips of the concert over the following months. This was part of AOL's plan to reposition itself a content provider, as opposed to an Internet service provider which delivered content only to subscribers in what was termed a "walled garden."
More recently, AOL has announced plans to offer subscribers classic television programs for free with commercials inserted. Programs available include Wonder Woman and Eight is Enough.
CD-ROM distribution
- See also: AOL disk collecting
AOL has tirelessly pushed itself through regularly mailing sign-up diskettes and CD-ROMs to over 100 million households, helping forge dominant growth. The long campaign has produced a backlash, including a program called No More AOL CDs that seeks to gather one million unwanted AOL CDs and dump them at AOL headquarters. Other organizations have objected under both environmental and privacy grounds. Environmentalists say that AOL's CDs are largely unwanted and result in massive non-biodegradable plastic waste. However, AOL's mailings have never violated the law, and always interest some people. AOL has also always provided means for people to remove themselves from AOL mailing lists, though No More AOL CDs has documented claims that these removal attempts are sometimes ineffective. Others view AOL disks as valuable collectible items due to the vast number of CD-ROM design variations.
AOL users' reputation
People using AOL (often referred to as "AOLers") have a reputation online for being excessively noobish— ignorant of netiquette. This is in part due to the fact that AOL is aimed towards users who are new to the Internet. To a segment of the online population, an e-mail address ending in aol.com is a sign of ignorance, to be avoided at all costs. Some web, game, and chat servers even go as far as to ban the AOL hostmask, preventing AOL users from logging on. However, this reputation doesn't stop aol.com addresses from being widely used, even in serious business contexts; it is still commonplace in advertisements in non-computer-related publications to see lines like "See our website at www.whatever.com, or e-mail us at whatever@aol.com," to the puzzlement of those who believe an address in the company's own domain would be more logical and professional.
AOL further provoked disdain from other Internet users during the early 1990s, when AOL began to provide access to the Usenet bulletin board system for its users. This led to a flood of relatively net-illiterate, commercial, young and immature users into what had previously been the almost exclusive domain of scientists, academics and technical personnel associated with universities and computer companies. The new AOL contingent immediately gained a reputation as pests in Usenet's numerous forums, making near-constant requests for pornography, bootlegged software and hacking information. (See: "Me too.") In early 2005, AOL ceased providing newsgroup access, instead referring customers to the Google Groups site, stating "Google does a very good job of hosting newsgroups and the typical AOL user probably doesn't use newsgroups that often."[4]
AOL e-mail accounts used to be only accessed using a nonstandard proprietary protocol not supported by other vendors' e-mail programs, compelling users, in the past, to use AOL's own mail program and be subject to its quirks and limitations. One consequence of the past practice is that when people receive e-mails from AOL users, the address, not the name of the user, is displayed, since the user's real name is not added in the manner that most other mail programs do it. In instances where the AOL user has chosen an alphanumeric alias, eg: "jwds75@aol.com" rather than "John Smith", the identity of the user is less clear to the recipient. Also in the past, users of the AOL client software were unable to click on hyperlinks in the text. Many experienced Internet users remain unaware that these inherent limitations of the AOL software are not due to any possible lack of computer skills by AOL users.
In a different vein, AOL users also have a reputation in some online communities for disruptive activities. AOL makes use of aggressive web caching proxy servers that effectively makes it impossible for a website, (such as a wiki), to block an abusive user without excluding large segments of the entire AOL community. Combined with the fact that their free service offers make it all too easy to join, many Internet trolls take advantage of this and choose AOL as a preferred means of hiding their true identity, in a manner that is almost as effective as using an anonymous proxy. This has only served to further harm the reputation of AOL users as a whole and is a large part of why some places implement a policy of banning all AOL users.
Controversies
Community Leaders
Prior to the middle of 2005, AOL used volunteers called Community Leaders, or CLs, to monitor chatrooms, message boards, and libraries. Some community leaders were recruited for content design and maintenance using a proprietary language and interface called RAINMAN, although most content maintenance was performed by partner and internal employees.
In 1999, Kelly Hallissey and Brian Williams, former Community Leaders and founders of anti-AOL website filed a class action lawsuit against AOL citing violations of U.S. labor laws in its usage of CLs. The Department of Labor investigated but came to no conclusions, closing their investigation in 2001. In light of these events, AOL drastically began reducing the responsibilities and privileges of its volunteers in 2000. The program was eventually ended on June 8, 2005. Current Community Leaders at the time were offered 12 months of credit on their accounts.
Billing disputes
AOL has faced a number of lawsuits over claims that it has been slow to stop billing people after their accounts have been cancelled, either by the company or the user. In addition, AOL changed its method of calculating used minutes in response to a class action lawsuit. Previously, AOL would add fifteen seconds to the time a user was connected to the service and round up to the next whole minute (thus, a person who used the service for 11 minutes and 46 seconds would be charged for 13 minutes). AOL claimed this was to account for sign on/sign off time, but because this practice was not made known to its customers, the lawsuit won (some also pointed out that signing on and off did not always take 15 seconds, especially when connecting via another ISP). AOL disclosed its connection time calculation methods to all of its customers and credited them with extra free hours. In addition, the AOL software would notify the user of exactly how long they were connected and how many minutes they were being charged for.
Account cancellation
In response to approximately 300 consumer complaints, New York Attorney General Eliot Spitzer’s office began an inquiry of AOL’s customer service policies. The investigation revealed that the company had an elaborate system for rewarding employees who purported to retain or "save" subscribers who had called to cancel their Internet service. In many instances, such retention was done against subscribers’ wishes, or without their consent.
Under the system, consumer service personnel received bonuses worth tens of thousands of dollars if they could successfully dissuade or "save" half of the people who called to cancel service. For several years, AOL had instituted minimum retention or "save" percentages, which consumer representatives were expected to meet. These bonuses, and the minimum "save" rates accompanying them, had the effect of employees not honoring cancellations, or otherwise making cancellation unduly difficult for consumers.
Many consumers complained that AOL personnel ignored their demands to cancel service and stop billing.
On August 24, 2005, America Online agreed to pay $1.25 million to the state of New York and reformed its customer service procedures. Under the agreement, AOL will no longer require its customer service representatives to meet a minimum quota for customer retention in order to receive a bonus.
Company purchases
As it grew, AOL purchased many other software companies, including:
- BookLink bought in December 1994.
- NaviSoft's NaviServer (later to become AOLserver) in 1994.
- ImagiNation Network (I.N.N.) from AT&T in 1996.
- CompuServe in February 1998.
- Mirabilis (maker of ICQ) in 1998.
- PLS text-search software in 1998,
- Nullsoft (maker of Winamp), in 1999 for $86 million
- Netscape, in 1999 for $4.2 billion.
- Mapquest in 1999.
- Tegic in December 1999.
- Singingfish search engine, November 2003.
- Advertising.com, an Internet advertising agency, in June 2004.
- MailBlocks, a personal, Web-based email service, in August 2004.
- Wildseed, a privately held mobile software vendor, in August 2005.
- Xdrive, a leading provider of online storage and file sharing services, also in August 2005.
- Weblogs, Inc., a blogging network that runs such sites as Engadget, Autoblog, Cinematical and TVSquad, in October 2005, for $30 million.
Notable persons associated with AOL
- Jim Kimsey (former CEO and board chairman)
- Steve Case (former CEO and board chairman)
- Jan Brandt (former President of Marketing)
- Justin Frankel (Nullsoft founder)
- Ted Leonsis (Vice-Chairman, President AOL Audience Group)
- Michael Powell (during merging with Time Warner)
- Marc Andreessen (Netscape co-founder)
- Jason Smathers (former AOL employee convicted of stealing the Internet provider's entire subscriber list -- over 30 million consumers, and their 90 million screen names -- and selling it to a known spammer.)
- Jason Calacanis (Co-founder of Weblogs, Inc.)
AOL Computer Checkup
AOL Computer Checkup is a service offered by AOL to AOL members. It is a performance and hardware analyzer, not unlike the scans in Norton Utilities.
See also
References
- Klein, Alec (2003). Stealing Time: Steve Case, Jerry Levin, and the Collapse of AOL Time Warner. Simon & Schuster. ISBN 0-7432-5984-X.
- Mehta, Stephanie N. & Vogelstein, Fred (Nov. 14, 2005). "AOL: The Relaunch". Fortune, p. 84–88.
External links
- AOL US
- AOL Brasil
- AOL Canada
- AOL Germany
- AOL France
- AOL México
- AOL UK
- AOL Japan
- AOL: A History
- AOL Disk Collection
- Important Dates & A Look at AOL's Evolving Interface
- The "No More AOL CDs" campaign
- alt.aol-sucks: Anti-AOL Usenet group (via Google)
Corporate Directors: Jim Barksdale | Steve Bollenbach | Frank Caufield | Robert Clark | Jessica Einhorn | Miles Gilburne | Carla Hills | Reuben Mark | Michael Miles |
Ken Novack | Richard Parsons | Ted Turner | Francis Vincent | Deborah Wright
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Annual Revenue: $42.1 billion USD (11% FY 2004) | Employees: 84,900 | Stock Symbol: NYSE: TWX | Website: www.timewarner.com