CompuServe posts big quarterly loss; on-line pioneer to retreat from consumer market and end family service
Article Abstract:
CompuServe reported a loss of $58 million, or $.63 per share, its largest quarterly loss, for the 2nd qtr ending Oct 31, 1996. To address its losses, CompuServe plans to terminate its WOW online service for families. CompuServe introduced WOW in Mar 1996, hoping to attract mainstream customers with its flat-rate fees and mechanisms for parental access control. CompuServe has otherwise resisted the trend among other online services to adopt a flat-fee pricing strategy. CompuServe will now focus on its business customers, who generate more revenue and generally retain the service longer than home users. The company's network-services division remained strong throughout the quarter and is increasing at 33% a year. CompuServe's losses have adversely affected H&R Block, which owns 80% of the company. Block reported 2nd qtr losses of $74.1 million, $.71 per share. It reduced its quarterly dividend by 38%.
Publication Name: The Wall Street Journal Western Edition
Subject: Business, general
ISSN: 0193-2241
Year: 1996
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Prodigy's new owner exerts control, installs its own executives at the top
Article Abstract:
International Wireless Inc has taken control of Prodigy Services Co and is reorganizing the online service. International Wireless has merged its operations with Prodigy's and renamed the new organization Prodigy Inc. Two of International Wireless' executives will be Prodigy's chairman and CEO. Greg Carr, who will serve as chairman, has named Paul DeLacey as Prodigy's president and CEO. Ed Bennett, Prodigy's former CEO, will head the company's venture-capital division and guide Prodigy's investments in new technology and media. Bennett will focus on the development of new companies, some of which could prove more valuable than the company's online service. Prodigy executives hope the move to the Internet will improve profitability. A Spanish version of Prodigy's service will be introduced to the Mexican market in fall 1996.
Publication Name: The Wall Street Journal Western Edition
Subject: Business, general
ISSN: 0193-2241
Year: 1996
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Comment about this article or add new information about this topic:
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