Feeds

Broadband could cost AOL $1bn in revenue by 2005

Doh!

  • alert
  • submit to reddit

Beginner's guide to SSL certificates

AOL could lose $1bn in revenues by 2005 because of the growth of broadband in the US.

So say analysts at technology research and consulting outfit, Strategy Analytics, who reckon that AOL could be clobbered financially for the growth in broadband.

In its report Can AOL Bridge the Broadband Gap?Strategy argues that AOL will lose out financially as the dial-up market, which it dominates shrinks (as more and more people sign up to broadband).

Even if punters sign up to AOL's "Bring Your Own Access" scheme, which lets users who get broadband from cable or telephone companies sign up to AOL's content service for $14.95 a month, Strategy estimates that it would cost AOL almost $9 a month per punter in lost revenue.

The report speculates that the "combination of a shrinking dial-up market and the diminished margins produced by broadband subscriptions revenue could cost the company nearly a billion dollars by 2005."

James Penhune, of Strategy Analytics said: "Broadband subscribers account for only about a quarter of the US online audience today.

"But by 2005, we expect that half of all online homes will be using broadband connections, most of them provided by cable and telephone companies.

"AOL may be able to maintain a commanding share of the dial-up audience, but the overall size of this market will have declined significantly."

Last month AOL Time Warner announced that it lost $99bn in 2002. ®

Related Story

AOL TW posts record $99bn loss

Secure remote control for conventional and virtual desktops

More from The Register

next story
FCC, Google cast eye over millimetre wireless
The smaller the wave, the bigger 5G's chances of success
It's even GRIMMER up North after MEGA SKY BROADBAND OUTAGE
By 'eck! Eccles cake production thrown into jeopardy
Mobile coverage on trains really is pants
You thought it was just *insert your provider here*, but now we have numbers
Don't mess with Texas ('cos it's getting Google Fiber and you're not)
A bit late, but company says 1Gbps Austin network almost ready to compete with AT&T
prev story

Whitepapers

Cloud and hybrid-cloud data protection for VMware
Learn how quick and easy it is to configure backups and perform restores for VMware environments.
A strategic approach to identity relationship management
ForgeRock commissioned Forrester to evaluate companies’ IAM practices and requirements when it comes to customer-facing scenarios versus employee-facing ones.
High Performance for All
While HPC is not new, it has traditionally been seen as a specialist area – is it now geared up to meet more mainstream requirements?
Three 1TB solid state scorchers up for grabs
Big SSDs can be expensive but think big and think free because you could be the lucky winner of one of three 1TB Samsung SSD 840 EVO drives that we’re giving away worth over £300 apiece.
Security for virtualized datacentres
Legacy security solutions are inefficient due to the architectural differences between physical and virtual environments.