
AOL Is Still the Weirdest Successful Tech Company in America - awwstn
http://www.theatlantic.com/business/archive/2013/05/aol-is-still-the-weidest-successful-tech-company-in-america/275673/
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obituary_latte
I'm pretty sure a good chunk of their profits are coming from people who have
gone _years_ without realizing they can cancel their "AOL" and still have
access to the internet via the DSL/Cable they are paying the phone/cable
company for.

I've seen this many, many times.

~~~
colkassad
I don't know...this sounds apocryphal. I've seen the occasional AOL email
address but I've haven't seen anyone claim they use AOL for internet in years.

~~~
kunai
My parents up until 2010 did not switch to a high-speed ISP and continued to
use AOL dialup until 2008, which is when they switched to NetZero which was
marginally faster but far cheaper.

In some ways, perhaps dial-up is a better proposition than DSL or cable due to
its slowness. It does discourage distraction and waste of time on the net, and
since I don't browse YouTube and use

    
    
      links2 -g
    

to browse the web, perhaps it isn't such a bad idea. Although, I would have to
go to Starbucks whenever I wanted to download a new Linux distro. ;)

As for email, I still do use an AOL email address. I use it for Facebook and
AIM, but I use my Hotmail (now "Outlook") for personal email and inquiries.

But AIM. Can't live without it.

If AOL calls it quits on AIM, I will probably shed a few tears. There is
nothing like AIM left. Facebook is locked-down and doesn't support buddy
lists, MSN is dead, Skype is proprietary and forces you to use its own client,
and nobody I know has a Google Talk account and my IM client doesn't support
it, even though I've tried to set it up as a Jabber/XMPP account.

~~~
kalleboo
> Facebook is locked-down

Facebook Chat has a Jabber interface.

Among my social group, everyone now uses Facebook Chat, iMessages, or Google
Talk. I think I only have one or two people still on AIM. I think the problem
with AIM is the lack of a default mobile client. Everyone's phone has Facebook
installed, or comes with either iMessages or Google Talk. Nobody bothers to
install an AIM client (I'm not even sure if there's an official one, and if it
supports Push notifications)

~~~
aaronbrethorst
Except for, y'know, AOL's AIM client.

[https://itunes.apple.com/us/app/aim-free-
edition/id281704574...](https://itunes.apple.com/us/app/aim-free-
edition/id281704574?mt=8)

(not that I've ever used it, mind you. Just wanted to make it clear that it
existed)

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untog
This is what makes stuff like closing AOL Music even sadder- AOL is in a
really weird position where they're making a ton of money where they shouldn't
be- they are in a prime position to do some really interesting things on the
net. But they don't.

~~~
ryguytilidie
It's actually pretty much the main problem with capitalism. Innovation often
drives prices down, and prices going down means less profit, so at a point,
there is an absolute disincentive to innovate. Obviously in theory people
would leave the inferior product, but that is clearly not the case in
situations like this.

~~~
dx4100
It happens in any type of economic system, except in capitalism, it happens
much slower. I'd prefer eventual stagnation with the possibility of reviving
innovation to a forced stagnation by a particular economic system.

~~~
shaddyz
I wouldn't consider capitalism an economic system. It is more of a description
of the behavior of organisms. Free markets naturally produce monopolies just
like humans have monopolized Earth. Once the monopoly is achieved, the
motivation to innovate diminishes along with the entity's competitiveness.
Eventually, someone will challenge the monopoly-holding alpha entity and the
cycle continues. It happens in economies, societies, ecosystems, and any
domain where evolution takes place.

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nathan_long
>> [dialup subscriptions] plus revenue associated with services like AIM,
accounts for more than 100 percent of the company's profit

More than 100 percent of its profits? Can someone explain that to me?

~~~
criley
Maybe the amount of profit from those two equals say a number that is 120% of
their total net profit, but losses in other divisions bring their total net
profit down.

Therefore, the profits of those two divisions is greater than the profit of
the company?

~~~
Waiting4Hellban
Effectively, their customers are paying to be advertised to.

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arbuge
I find it hard to believe those media properties like Huffpo are losing money.
I didn't read their financial statements but I wonder if it's just a financial
artifact caused by deprecation/amortization. They bought Huffpo for $315m a
few years ago for example... if they're amortizing that over several years,
they could really be printing money but ending up with an accounting loss.

~~~
jcampbell1
Goodwill does not depreciate, thus your accounting explanation doesn't make
sense. Huffpo cannot be that profitable because their ad inventory is total
garbage. That site is probably worth less than $1 CPM. They probably make a
mere million dollar per billion page views.

~~~
andrewthornton
If they are getting $1 CPM it would be a miracle.

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WayneS
So they profit from idiots? That is a pretty good strategy, they will never
run out.

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etrautmann
This does not consider market cap. Yes, AOL's stock price has done better, but
the total revenues are a tiny fraction of Apple...

~~~
wpietri
Yes.

Stock A rising more than stock B only means that the market has been more
pleasantly surprised about A than B.

So given that the point of the article is "AOL is doing surprisingly well
thanks to low expectations", it'd be natural that the stock would gain more
than companies that people expect more from.

Also, I'd have a hard time calling AOL successful (which the article does).
They're _net profitable_ , but on something that's doomed. And the thing
that's supposed to save them, selling ads against content, is looking pretty
sickly as well. Profit is correlated with success, but they're definitely
different.

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spoiledtechie
I was just asked for an Interview by AOL for their Streaming Media business.
The recruiter told me that the media business was totally profitable as I
questioned AOLs future.

I guess now, in hindsight, im glad they were working with tech I didn't want
to put my hands into or someday, I would be looking for another job.

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Demiurge
AOL also own Winamp, my favorite music (and internet radio) app since the 90's
:(

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rokhayakebe
I am wondering they don't run TV ads targeted towards this demographic.

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fluidcruft
Revenue for that division/activity happens to be larger than overall company-
wide profit. The author's use of "accounts for" implies some sort of
causality, but I suspect literary flourish and innumeracy.

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dgbsco
MapQuest.

