AOL

1,535 views

Published on

Business Model and Engineering Management Background Analysis.

Published in: Business, Technology
0 Comments
4 Likes
Statistics
Notes
  • Be the first to comment

No Downloads
Views
Total views
1,535
On SlideShare
0
From Embeds
0
Number of Embeds
10
Actions
Shares
0
Downloads
0
Comments
0
Likes
4
Embeds 0
No embeds

No notes for slide
  • Business models often change when a company is trying to survive in an ever changing market. Keeping up with competitors can be difficult so the business strategy.
  • Strategy: focuses on growing the size, engagement and monetization of its worldwide audience by providing highly relevant content and advertising to consumers across the Web AOL is best known for its online software suite. - world's largest "walled garden" - Peak: AOL's membership was over 30 million members worldwide
  • Focus: Content Provider
  • Focus: Content Provider & Online Adveritising
  • Cable pioneer named William von Meister was looking for a way to use his innovative modem transmission technology - unsuccessfully presented the idea of downloading music through the technology - Had a a delivery tool and no content. - Converted his variable speed adaptive modem technology to download games from central servers to individual households.
  • Kimsey was brought in by an investor. Out of 100 employees from Control Video, only 10 remained in the new company. Kimsey changed the company's strategy, and in 1985 launched a dedicated online service for Commodore 64 and 128 computers, originally called Quantum Link ("Q-Link" for short).
  • After the company parted ways with Apple in October 1989, Quantum changed the service's name to America Online Kimsey soon began to groom Case to ascend to the rank of CEO, which he did when Kimsey retired in 1991.
  • Originally, AOL charged its users an hourly fee, but in 1996 this changed and a flat rate of $19.99 a month was charged. Within three years, AOL's userbase grew to 10 million people. During this time, AOL connections would be flooded with users trying to get on, and many canceled their accounts due to constant busy signals (this was often joked "AOL" standing for "Always Off-Line").
  • At it’s peak, AOL had 30 million subscribers. Competitors emerged - cheaper dial up providers; broadband sources AOL had - base technology and had a key technology but had no pacing technology
  • Brief timeline of important milestones
  • Aol would continue to upgrade its services but the upgrades lacked a new identitiy
  • Did not reinvent themselves. Compare to ipod
  • This would be the perfect time to do a SWOT analysis
  • Lack of swot analysis People expected this merger to have the strengths of both Management was bad - and unethical and that went down the management
  • Employees had quotas and bonuses for discouraging people from ending their service. They would also stall the discontinuation of billing. Released user search criteria.
  • New Business Model - as a content provider like yahoo
  • AOL

    1. 1. Business Model Evolution Sheena Deol Engineering Management An Analysis of AOL’s Products and Services
    2. 2. Overview <ul><li>Background </li></ul>Management History Rise, Fall and Redemption Conclusion
    3. 3. Overview <ul><li>Background </li></ul>Management History Rise, Fall and Redemption Conclusion
    4. 4. AOL <ul><li>AOL is a leading global ad-supported Web company, with a comprehensive display advertising network in the U.S., a suite of popular Web brands and products, and a leading social media network . In addition, AOL continues to run one of the largest dial-up ISP Access businesses in the US. </li></ul>
    5. 5. Specialties (2009) <ul><li>Online Advertising </li></ul>Internet Web WWW Websites Web Portal Homepages Blogs Streaming Content Provider SEO SEM ISP Narrowband
    6. 6. Specialties (2009) <ul><li>Online Advertising </li></ul>Internet Web WWW Websites Web Portal Homepages Blogs Streaming Content Provider SEO SEM ISP Narrowband
    7. 7. Overview <ul><li>Background </li></ul>Management History Rise, Fall and Redemption Conclusion
    8. 8. Before AOL <ul><li>Control Video Corporation (CVC) (1980s) </li></ul><ul><li>Founded by Bill von Meister </li></ul><ul><li>Gameline for the Atari 2600 video game console </li></ul><ul><li>Subscribers bought a modem for $49.95 and paid a one-time $15 setup fee. </li></ul><ul><li>Temporarily download games for $1 per game. </li></ul>
    9. 9. Before AOL <ul><li>Quantum Computer Services (1983) </li></ul><ul><li>CVC was near bankruptcy - Von Meister left the company. Jim Kimsey (a manufacturing consultant) became CEO </li></ul><ul><li>Commodore 64 & 128 </li></ul><ul><li>Quantum Link software was based on software licensed from PlayNet, Inc. In May 1988, Quantum and Apple launched AppleLink Personal Edition for Apple II and Macintosh computers. </li></ul>
    10. 10. --> America Online <ul><li>America Online (1989) </li></ul><ul><li>CEO Jim Kimsey until 1991: Steve Case </li></ul><ul><li>AOL as the online service for people unfamiliar with computers, in particular contrast to CompuServe, which had long served the technical community </li></ul><ul><li>Special Features: Chat Room, Music, Mail, Community, Search, News </li></ul>
    11. 11. Unique Features
    12. 12. Overview <ul><li>Background </li></ul>Management History Rise, Fall and Redemption Conclusion
    13. 13. AOL Subscribers [U.S. 2001-2009]
    14. 14. Timeline <ul><li>1991 AOL for DOS launched </li></ul>1990 1995 2000 2005 2010 1993 AOL for Windows launched 1996 AOL 3.0 for Windows 95 released 2001 AOL 6.0 for XP launched 2000 AOL and Time Warner plan to merge 2009 AOL and Time Warner plan to split 2004 AOL 9.0 for Vista Launched 2005 AOL (w/ Telepictures) launches TMZ.com
    15. 15. Timeline <ul><li>1991 AOL for DOS launched </li></ul>1990 1995 2000 2005 2010 1993 AOL for Windows launched 1996 AOL 3.0 for Windows 95 released 2001 AOL 6.0 for XP launched 2000 AOL and Time Warner plan to merge 2009 AOL and Time Warner plan to split 2004 AOL 9.0 for Vista Launched 2005 AOL (w/ Telepictures) launches TMZ.com
    16. 16. Updated Versions <ul><li>Ever since the original AOL was released, there was a consistent release of newer versions </li></ul><ul><li>The updates would create few changes - mainly in design - and not the user experience. </li></ul><ul><li>AOL was relatively late in providing access to the open Internet. </li></ul><ul><li>AOL has fallen from its peak of 30 million users to 10.1 million subscribers as of November 2007 </li></ul>
    17. 17. Timeline <ul><li>1991 AOL for DOS launched </li></ul>1990 1995 2000 2005 2010 1993 AOL for Windows launched 1996 AOL 3.0 for Windows 95 released 2001 AOL 6.0 for XP launched 2000 AOL and Time Warner plan to merge 2009 AOL and Time Warner plan to split 2004 AOL 9.0 for Vista Launched 2005 AOL (w/ Telepictures) launches TMZ.com
    18. 18. AOL-Time Warner Merger <ul><li>CEO: Gerald Levin, former CEO of Time Warner </li></ul><ul><li>Chairman: Steve Case </li></ul><ul><li>Followed by: Barry Schuler, Jonathan F. Miller (2002-2006), Randy Falco (2006-2009), Tim Armstrong (March 2009-present) </li></ul><ul><li>Since its merger, the value of AOL has dropped significantly from its $240 billion high. Its subscriber base has seen no quarterly growth since 2002. </li></ul><ul><li>The company failed to provide fast service while cutting costs and limiting access. </li></ul><ul><li>Time Warner announced that it would spin off AOL into a separate public company by the end of 2009. </li></ul>
    19. 19. Controversial Practices <ul><li>The Company grew too fast and couldn’t provide appropriate services. </li></ul><ul><li>Did not provide open internet access. </li></ul><ul><li>Did not adapt to broadband </li></ul><ul><li>Costs did not change to the new market </li></ul><ul><li>Call center - Discourage customers from ending service; delaying the end of service [Bonuses] </li></ul><ul><li>To cut costs, they outsourced their call centers </li></ul>
    20. 20. Timeline <ul><li>1991 AOL for DOS launched </li></ul>1990 1995 2000 2005 2010 1993 AOL for Windows launched 1996 AOL 3.0 for Windows 95 released 2001 AOL 6.0 for XP launched 2000 AOL and Time Warner plan to merge 2009 AOL and Time Warner plan to split 2004 AOL 9.0 for Vista Launched 2005 AOL (w/ Telepictures) launches TMZ.com
    21. 21. Current Business Model <ul><li>AOL has since attempted to reposition itself as a content provider similar to companies such as Yahoo! as opposed to an Internet service provider. </li></ul><ul><li>AOL, with Telepictures Productions, launched TMZ.com, one of the leading celebrity news and gossip sources on the web. TMZ.com has become known for its quickness to break celebrity news, often accompanied by exclusive videos and photos. </li></ul><ul><li>AOL also prides itself on being an online advertiser and publisher resource to drive site revenue. </li></ul><ul><li>AOL has planned to separate it’s content and internet provider divisions, possibly selling the internet side </li></ul>
    22. 22. Overview <ul><li>Background </li></ul>Management History Rise, Fall and Redemption Conclusion
    23. 23. Conclusion <ul><li>After AOL’s Merger, the company was lead by someone that was run by someone unfamiliar with the services. </li></ul><ul><li>The merger brought hope of a more multimedia service but failed to deliver. </li></ul><ul><li>The bad practices lead to bad publicity through word of mouth. </li></ul><ul><li>The company failed to adapt to the new competitive market </li></ul><ul><li>The updated versions failed to reinvent AOL for the new market </li></ul><ul><li>The New Model of a Content Provider provides a source of revenue for the new company </li></ul>

    ×