AOL – Last of the Garden Walls Comes Down

Todd Borglund, our head of production at CXO, is fond of showing two sites to me, over and over again. One is ESPN, the other is the new AOL homepage, the "free" version that represents the end of AOL’s long-running battle to tuck content behind the walls that brought down Prodigy, CompuServe and the other proprietary online services of the 80s.

AOL has been bleeding subscribers to its ISP business at a rapid clip — I recall one news squib last winter that estimated 500,000 suscribers per month were cancelling their service and moving their business to their telco’s DSL offerings or cable company’s cable modem plan. AOL was built on racks and racks of modems, and now, with dial-up hanging on in the rural areas, something had to give in the demographic model to get people back in front of the content.

So the walls have come down.

Skip back to the late 90s, when AOL was the Google of its day, commanding massive marketing muscle during the nuttiness, asking for, and receiving $20 million marketing packages for high-velocity startups trying to amass, at all costs, all the eyes they could. Was there any more powerful force in new media? Could anyone have foreseen a time when AOL — as much a part as the cultural gestalt as any digital phenomena ever was or will be — would be replaced by something that was free? Having suffered in the land of Prodigy and CompuServe in 1994, my allergy to walled gardens hoped and prayed that the dumbing down of the Internet that AOL represented would be replaced by something less expensive, more standard, and more open. (Remember the idiotic Instant Messaging interoperability battles between AOL, Microsoft Messenger, and Yahoo? That towel got tossed last week.)

Then came the big  step-in-it-with-both-feet move by Time Warner in January 2000, the peak of the insanity, when Levin took off the suit, pulled off the tie, and committed one of the biggest M&A blunders of all time.

Today one wonders as Google and Yahoo and Microsoft circle AOL if they are suitors wooing a bride or vultures circling a crawling man in the desert, waiting for the inevitable? Whatever the state of AOL’s health, I agree with Todd, at least they have a nice homepage and some credible blogs after stealing Weblogs for $25 m.

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