America Online to raise fee for unlimited use to $21.95: stock up nearly $12 after announcement
Article Abstract:
America Online (AOL) said that it was raising its standard monthly unlimited Internet access charge from $19.95 to $21.95. The move represents a significant departure from the $19.95 flat-rate plan AOL introduced at the end of 1996. AOL serves 11 million US customers, who account for more than 50% of the domestic home Internet market. The increase coincided with an AOL management reorganization that promoted AOL network division Pres Robert W. Pittman to pres and COO of the entire company. News of the price increase drove up AOL stock by $11.9375 to an all-time high of $110.4375. AOL Chmn Stephen M. Case said the company would apply the extra money to higher network expenses and innovation funds rather than boosting 1998 company profits. The company also announced that it was laying off 50% of the remaining employees of former rival Compuserve, which AOL purchased earlier in Feb 1998.
Publication Name: The New York Times
Subject: Business, general
ISSN: 0362-4331
Year: 1998
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A reorganization is expected at America Online
Article Abstract:
America Online is planning to dissolve its AOL Studios division in a management reorganization, according to people close to the company. The shift would widen the power of AOL Networks leader Robert W. Pittman, whose division operates AOL's core on-line services. Pittman also would take responsibility for the new on-line content development currently led by AOL Studios Pres Ted Leonsis. Pittman has drawn acclaim for establishing discipline through customer service improvement and bottom line emphasis. AOL created AOL Studios in mid-1996 to develop on-line programming. The reorganization would represent a significant turnaround for acquisition-minded AOL, which has decided to merge the studios back into the network division. Leonsis, who has reported directly to AOL Chmn Stephen M. Case, now is expected to report to Pittman in an undetermined role.
Publication Name: The New York Times
Subject: Business, general
ISSN: 0362-4331
Year: 1998
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America Online's triumvirate in cyberspace; the service provider everybody loves to hate changes by the nanosecond
Article Abstract:
AOL CEO Stephen M. Case has successfully anticipated what users want from an online service, keeping far ahead of competitors such as Microsoft, IBM, AT&T, Compuserve and the News Corporation. The executives Case has recruited to work with him are key factors in AOL's success. The company's stock tripled in value in 1997, however during its last quarter the ISP only earned $20.8 million on sales of $592 million. AOL's advertising revenue makes up 18% of its total revenue, nearly double what it was at the beginning of 1997. The ISP signed 2.9 million new members in 1997, reaching eleven million members who spend 250 million hours every month online. The company offers a flat monthly fee of $19.95 and has increased its dependence on advertising.
Publication Name: The New York Times
Subject: Business, general
ISSN: 0362-4331
Year: 1998
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