Tuesday, December 14, 2004


AOL doesn't get it. As I wrote a while back, their broadband strategy and executives leading the company reflect their lack of knowledge on who they are servicing... technology neophytes or high-speed pipe huggers? The latter is the obvious choice if you want to be a "broadband" company.

Fat-trimming has helped ailing America Online set a course to recovery--but questions persist about whether that will be enough for the Internet veteran to reclaim its former glory.

Early next week, AOL is expected to undergo another painful round of layoffs, ranging north of 700 workers, according to sources familiar with the plans. Most of these layoffs will hit AOL's 5,000-employee Dulles, Va., headquarters, with operations such as broadband, technology development and marketing hit particularly hard, other sources close to the company said.

Analysts said the tough medicine will further boost AOL's operating income, which has soared even as millions of subscribers turn their backs on the company's dial-up service in favor of faster broadband connections. Customers are taking their money to cable and DSL providers at the expense of the dial-up giant. AOL executives have been looking at ways to deal with a shift that shows no sign of stopping.
(full article)

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