• Reuters, Tuesday, March 7, 2006 11:15 AM

Time Warner's AOL unit, which has been in the midst of a much-needed transformation for better than a year, will soon behave even more like Web rivals Yahoo! and Google when it begins selling content on its site. The company says it will not limit content to what is produced by Time Warner's various divisions. Instead, it is in discussions with an array of TV networks and other providers of video and music. One reason AOL is beginning to go where others have gone before is the perception that Apple's iTunes site, which has been enormously successful, imposes too rigid a price structure on consumers. AOL will be more flexible in its pricing. Some of the content available for download will even be free. "One analyst was skeptical of the pay per download business model AOL plans to employ and said it would face stiff competition against lower cost alternatives, such as EchoStar System Corp.'s PocketDish system," reports Reuters. The PocketDish lets viewers move recorded shows from their living room digital video recorders to a portable media device. "I'm still skeptical of the size of an individual download model, as [digital video recorder] technology is growing," Richard Greenfield, an analyst at Pali Research, told Reuters. AOL's system "needs to evolve to a traditional advertising model, rather than a pay per download model."

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