Free AOL: a look at the numbers

Iria · Jul 12, 2006, 04:09 AM

Source: Ars Technica
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Last week we talked about AOL's new plan to make money: free access for broadband users combined with an online ad push. The idea is to find future profits in advertising (like Google) instead of in the shrinking market for AOL subscriptions, which has always been the company's bread and butter. Today, the Wall Street Journal offers more details about what the move could cost AOL (subscription required).

The paper expects that AOL will give up almost US$1 billion in profit over the next three years if it does do away with subscription fees for broadband users. Even to a company as large as AOL, this is some serious cash. The plan is to offset this loss by cutting the same amount from the company's marketing budget (which won't be as focused on signing up new subscribers) and by boosting ad sales.

Jul 12, 2006, 04:09 AM	#1
Iria DriverHeaven Extreme Member Join Date: Apr 2004 Posts: 7,275 Rep Power: 89	Free AOL: a look at the numbers Source: Ars Technica _______________ Last week we talked about AOL's new plan to make money: free access for broadband users combined with an online ad push. The idea is to find future profits in advertising (like Google) instead of in the shrinking market for AOL subscriptions, which has always been the company's bread and butter. Today, the Wall Street Journal offers more details about what the move could cost AOL (subscription required). The paper expects that AOL will give up almost US$1 billion in profit over the next three years if it does do away with subscription fees for broadband users. Even to a company as large as AOL, this is some serious cash. The plan is to offset this loss by cutting the same amount from the company's marketing budget (which won't be as focused on signing up new subscribers) and by boosting ad sales.