Commentary

AOL: A Legacy Of Most-Hated

By now, as I have, you've read tens of thousands of words about the Verizon acquisition of AOL. Personally, I couldn't care less if it paves the way for Verizon to serve video content and ads better, or results in the sale of HuffPo and TechCrunch to the Germans (or the Poles or the Estonians). Or vaults the value of Tim's shares to over $80 million. Just don't care.

I used to care about AOL a lot, because thanks to its early dial-up business, I got to wait three or four minutes for a page to load at a baud rate of about 2,400. Of course there were no real HTML Web pages then -- just photos or text that you could download off Usenet lists. But it didn't take long for AOL to become one of the most-hated companies in the country because it spammed millions with install discs, which came to be recognized as PCWorld’s most annoying tech product.

According to Jan Brandt, AOL’s former chief marketing officer: "At one point, 50% of the CDs produced worldwide had an AOL logo on [them]." Scores, if not hundreds, passed through my mailbox or fell out of periodicals or were tossed in my shopping bags. Today they sit in landfills, where they may never degrade.

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AOL slipped further in public esteem when it was revealed that trying to cancel its service was next to impossible. Recordings surfaced of ugly conversations between AOL "helpline" staffers who drove users to tears by refusing to stop the service.

Little more needs to be said about AOL's disastrous marriage to Time Warner other than the subsequent plunge in its stock price down to about $8 a share, wiping out a significant amount of savings for long-time Time Warner employees, whose options sank fatally under water.

In 2005, The Securities and Exchange Commission charged Time Warner Inc. for a wide array of wrongdoing by AOL, including fraudulent round-trip transactions to inflate online advertising revenues, fraudulent inflation of AOL subscriber numbers, misapplication of accounting principles relating to AOL Europe, and participation in frauds against the shareholders of three other companies. Lots of senior AOL execs were dumped — but not before they had comfortably lined their pockets.

As part of its TW holdings, AOL owned Time Warner Cable -- which in short order, became the most-hated cable company in the world, with perhaps the worst "customer service" in telecom history. The AOL legacy at work?  

Since Time Warner and AOL divorced in 2010, it has been the Tim Armstrong show. Not all of it pretty, such as when he offhandedly fired an employee during a conference call with over 1,000 attending, and when he claimed that Obamacare and two “distressed babies” increased healthcare costs for AOL by $7.1 million per year — pissing off nearly every woman in America. Under Armstrong's direction, AOL limped along, consistently missing ad revenue goals it had promised analysts. But to his credit, he acquired enough of the right technology to become a target for Verizon.

So now the circle is complete. AOL has gone from being the most-hated tech company in the country, to being part of the most-hated cable company in the country, to now being a division of the one utility that everyone loves to hate: the phone company.
Karma.

4 comments about "AOL: A Legacy Of Most-Hated".
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  1. Matthew Sharp from Novantas, May 15, 2015 at 10:33 a.m.

    Hey George, need a hug?

    Also - you might want to fact-check this sentence...

    "Under Armstrong's direction, AOL limped along, consistently missing ad revenue goals it had promised analysts."

  2. George Simpson from George H. Simpson Communications, May 15, 2015 at 11:13 a.m.

    For the fourth quarter, AOL reported revenue of $710 million, up 5% from the previous year, but below the $721 millionĀ estimated by analysts.

    ....a familiar tune




  3. Leonard Zachary from T___n__, May 15, 2015 at 5:12 p.m.

    George do you consider Verizon a legacy or futuristic company?

  4. George Simpson from George H. Simpson Communications, May 15, 2015 at 7:59 p.m.

    Anyone who has control over how and what is delivered to the handhelds of 100 million or so folks has a great future even if they began life as a baby Bell.

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