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AOL Europe fights back against free ISPs

Plans revolve around new Portal strategy

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AOL Europe has take off the gloves and come out fighting against subscription-free Internet service providers. Stung by the phenomenal growth of free ISPs in the UK AOL Europe is worried that this same model could be replicated throughout Europe in a domino-like chain reaction that would jeopardise its position as a subscription service. Of course, executives at AOL Europe have stopped short of saying this is why they went on the offensive today at a pre-CeBIT press conference outlining a raft of new initiatives designed to show that AOL is an aggressive player in the marketplace. But they are worried -- that much is true -- especially if you believe the adage that the best form of defence is attack. Instead, spokesman Stephan Naundorf admitted that the more aggressive stance was due to a more "competitive marketplace" that was "heating up". On more than one occasion he denied any suggestion that AOL Europe is reeling from the pressure of upstart ISPs. But the strength and tone of today's announcements suggests that something isn't quite right. Among the new initiatives unveiled by president and CEO Andreas Schmidt, AOL Europe intends to introduce a new portal strategy aimed at generating a greater share of advertising revenue. He said that AOL and CompuServe would remain separate and distinct brands served by combined business support functions. AOL will continue to serve mass-market home users while CompuServe will increasingly be focused on vertical business and professional audiences, said Schmidt. He also renewed calls for telcos to offer flat-rate charges for Net access to help "accelerate Europe's emergence as a leading Internet power". And since this is only ever likely to happen -- if ever -- by legislation, he's also offering AOL Europe's services to politicians throughout the Europe as a way of educating out-of-touch MPs about the benefits of the wired world. "Now, AOL is poised to lead Europe into the next stage of mass-market growth and acceptance, driven by our superior value and a powerful growth strategy based on a tested business model," said Schmidt. "At the same, we will continue to push for policies and a business environment that will allow Europe to realise its potential as a competitive, modern 'Net-centred' economy." ®

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