Infrastructure
News
3/1/2004
10:59 AM
Connect Directly
RSS
E-Mail
50%
50%

AOL Discontinues Bundled Broadband Offer

It's now requiring subscribers to provide their own high-speed connection via DSL or cable modem.

NEW YORK (AP) -- America Online Inc. has quietly stopped offering a complete broadband package, requiring subscribers to instead obtain their high-speed Internet connections directly from a cable modem or DSL provider.

The reversal in strategy stands as another black mark against the purported wisdom of the $160 billion merger between America Online and Time Warner at the height of the Internet boom, a deal the companies had described as a perfect marriage of new and old media with the means to deliver it.

The decision to stop selling bundled service--an AOL-branded cable or DSL connection combined with AOL's walled garden of content--follows a strategic realignment that began in December 2002, AOL spokeswoman Anne Bentley said Friday.

The change, which took effect late last month, does not affect customers who bought the package before then.

Although AOL would not provide a detailed breakdown, relatively few of the company's 3 million broadband subscribers had the $54.95-a-month package. Most had AOL's "bring your own access" service for $14.95 a month and obtained access separately, Bentley said.

In addition to the broadband customers, AOL has about 21 million dial-up subscribers in the United States.

Dave Burstein, editor of the online DSL Prime newsletter, termed the termination of bundling an admission of defeat.

Microsoft Corp.'s MSN online service also withdrew from selling broadband access last year, though customers can buy a bundled access-and-content package directly from partners Qwest and Verizon.

Burstein questioned whether that many more customers would want to buy AOL content on top of access from another provider.

"Selling access, you had to buy something from them," Burstein said. "That was a real service. ... Now they are essentially another Web site."

But Bentley said uncoupling access from content permits nationwide marketing of "AOL for Broadband," a service with richer audio and video content for high-speed.

Before, AOL could offer bundling only in select markets, primarily areas served by sister company Time Warner Cable and a handful of DSL companies with which it had deals.

Comment  | 
Print  | 
More Insights
2014 Next-Gen WAN Survey
2014 Next-Gen WAN Survey
While 68% say demand for WAN bandwidth will increase, just 15% are in the process of bringing new services or more capacity online now. For 26%, cost is the problem. Enter vendors from Aryaka to Cisco to Pertino, all looking to use cloud to transform how IT delivers wide-area connectivity.
Register for InformationWeek Newsletters
White Papers
Current Issue
InformationWeek Government Oct. 20, 2014
Energy and weather agencies are busting long-held barriers to analyzing big data. Can the feds now get other government agencies into the movement?
Video
Slideshows
Twitter Feed
InformationWeek Radio
Archived InformationWeek Radio
A roundup of the top stories and trends on InformationWeek.com
Sponsored Live Streaming Video
Everything You've Been Told About Mobility Is Wrong
Attend this video symposium with Sean Wisdom, Global Director of Mobility Solutions, and learn about how you can harness powerful new products to mobilize your business potential.