/ Rob Beschizza / 7:11 pm Fri Jan 21, 2011

Most AOL revenue from dial-up zombies?

According to the New Yorker (via Consumerist) 80 percent of AOL's revenues are from subscriptions, and 75 percent of those may be paid subscribers who have another ISP. Dial down!

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  1. Must be those folks who got the free CD, and then found out that it was impossible to cancel without the secret handshake.

    1. @husseycombe

      What? You ARE surprised, then?

      I could care less.
      ——————————

      I can’t say I’m surprised; I know someone who has only just been persuaded to use IE to browse – previously did it all from inside AOL’s “application”. AOL uses the internet to make money from ignorance – a paradox for our times.

  3. I am definitely not surprised. I used to work as tech support for other dialup and highspeed ISP’s through the U.S. and can’t count the number of times per week I would talk to people who used and paid for AOL every month even though they had another service. Trying to explain it to them… near impossible.

  5. I got my first home PC in ’82 or so. And my first ISP was AOL. Back in those days there were about 400,000 users on AOL. I made a lot of friends and connections. Chat rooms were a lot of fun and a lot less scary there back then.
    Eventually, I managed to learn the secret handshake and get off.

    1. Don’t under estimate the power of automated billing. In the years to come you’ll start hearing more and more stories of some poor schmoe dying, but the bills were paid so nobody noticed.

      There should be some form of yearly mandatory renewal for stuff like that to at least limit the damages for someone who might forget they are paying for something they don’t need.

  6. They actually started selling a level of service just to people who used other ISPs, so probably a lot of these are from that, or people who don’t want to lose their old AOL email address because they’ve had it since the 90s.

  7. For a while, a lot of dialup ISPs were offering cheaper rates for 2- or 3-year contracts. I wonder how many subscribers are still on these contracts.

  8. Actually, I know a lot of overseas contractors that have them. Since AOL is the most reliable internet connection when you’re in out in a middle of nowhere in a 3rd world nation. Surprised the shit out of me too.

  9. AOL made it really hard to cancel the free trial. Almost everybody I’ve met who used it got bitten by that.

  10. I had a paid dial-up AOL sub until last spring.

    I share the account with some elderly relatives. We split the costs. I didn’t mind until the year before last, when WiFi availability exploded and it was no longer necessary for a business traveller to have a dial up account “just in case.”

    The last of my aunts got broadband last year, but wanted to keep their AOL email addresses and software, out of inertia. The free email plan would have been ideal, but we’re still paying . . . $4.99 a month so my relations can have phone technical support. They pay for that, and seem quite happy to do so.

  11. Quitting AOL was easy for me… when they stopped supporting the Apple // platform back around 1990, they unceremoniously kicked me off.

  12. Yeah, I think my wife’s Aunt and Uncle (befpre he recently passed) were paying for THREE ISP’s:

    1. “The wireless” appeared to be a local ISP of some sort, for the Aunt’s newish PC and iPhone.

    2. Some wired connection that could only be accessed by one ethernet cable, for the Uncle’s MacBook Pro. I think this was Comcast.

    3. AOL for the “Business email” because the Aunt was certain that is she ever switched accounts no one could ever find her. Mind you, this address was no aol.com address, she had just been trained to open AOL and let it -dial in- on a computer that was already on the wireless before she could check that email. With Entourage.

  13. my parents still have dial up provided by aol. they use it to check email and are able to load two web pages a day. they dont care to know or learn about the facebook or the google. i dont know if my dad knows how to check his aol email at work. going to aol.com to check would be to much. its cheap and suites their needs. luckily their neighbors have an open wifi connection so i can bring my laptop whenever i go over.

  14. That article was just one giant run-on paragraph. We’re supposed to pay “extra” for “journalism” like that?

    1. “That article was just one giant run-on paragraph. We’re supposed to pay “extra” for “journalism” like that?”

      That is just the first paragraph of an article that continues for another 6 pages (a fairly typical size of a New Yorker article).

      But if you’re already overwhelmed by that first paragraph, then I guess it’s no wonder publications like this are struggling to survive…

  15. I know it seems silly to most anyone near a decent sized city, but there are many out there in the country who would rather pay $20/month to check email and an occasional web page vs $50-100 a month for broadband.

  16. I wonder: is there a business opportunity for some organization
    to get the word out that “Youre paying for a service you don’t need”?
    Altho, these are people who, by definition, aren’t very good monitors
    of where their money is going, so why would they be customers for
    a business that helps them monitor their money…

    Just seems like with all the millions of zombie AOL customers
    spewing out $15 a month for nothing, you could monetize the service
    of killing zombies.

  17. Its telling that the original plan was to sell-off the access business like they did in Europe. However, the European experiment showed exactly how reliant they are on not only the dial-up subscriptions, but also the AOL client to drive the few remaining ad impressions and search queries they do enjoy.

    For example, looking at the Q2 2010 earnings report, advertising revenue for the quarter moved in lock-step with the decline in subscription revenue – both down by 27%.

    I’ve got friends who refuse to leave the paid service because they are so used to the environment of the AOL client. Their email is locked up in the proprietary PFC format, as are their bookmarks and address books.

    But the trajectory for AOL is clear – a huge chunk of their traffic is from legacy subscribers and that base is under attrition. Albeit slower than is should be, but its eroding.

  18. I bet that a good portion of those are rural users who do not have access to broadband. Nevertheless I know from a family member, who just dropped AOL dial-up, that was still being charged $29.99 a month for the service after 15 years. Customer retention said they could slash the rate to $12.99. No kidding.

  20. used to work as a zombie killer. a competing dialup internet had (has?) a habit of ending up on people’s bills.

    Details like wanting the service, having a computer were not factors in the signing up of these customers.

    My favorite zombie was an apartment elevator with two years of dialup internet.

    Cancelled the things, put in refund requests for some of the charges, but nearly got fired for that..

    was taken to an office and informed that if people wanted a refund of these charges, they could ‘fight for them’.

    suffice it to say not quite trusted their mothership company no matter how neat their smartphone is.

  21. I was one of the people who used AOL to first go on-line. It made sense at the time as broadband was just being introduced. The moment I got a high speed modem, I left AOL. After I moved from home, I discovered that my dad was still using it and thinking he needed it to use the internet…with his own high speed service. It took me a long time to convince him that he did not need AOL to browse the Web. I believe that are millions of people who have this belief.

  22. It would be nice to know the distribution of options available to the 75%. My parents, for example, who have AOL dialup, live in an area just outside the reach of the local wireline broadband providers, and theoretically have access to two-way satellite broadband (though they’re actually too deep in a valley for anything pointing at geosynchronous satellites to work), and I wonder which group they would count in.

  23. It’s pretty arrogant to consider that everyone who uses AOL is ignorant. Just because you don’t need it doesn’t mean there might not be situations unlike your own where the service is still useful. We have it, as well as another ISP, and AOL does have it’s uses. Like others, we also piggyback elderly relatives on it. Until recently dial-up was our only option out in the rural area where we live. Even now smartphones do not work well out here, so we don’t spend our money on those services. AOL has also come in handy while traveling. We’re certainly not paying $30 a month for it, but for the minimal cost, it’s useful to have sometimes.

  24. how many elderly are still paying a $30 quarterly fee for ROTARY TELEPHONE rental to AT&T/Lucent/Alcatel/whatever? Looks like 750,000 as of 2006, I hope that number’s gone down.

  25. It seems that the point the author was making is that there are many out there that don’t need to use AOL to connect to the internet any longer because they have a different ISP but still continue to pay the fees (knowingly or not). As a volunteer for Google’s help boards, we see tons of people that list an ISP and then tell us that they use AOL to browse…so AOL’s browser is still being used too. Note that some might also have AOL email addresses they just don’t want to give up…many reasons why some would still be on the service. It is the ones that don’t need it and aren’t aware that they are still being charged for it that I feel bad for. When we dropped AOL, it took threatening them with a credit card fraud complaint to get them to stop charging our card.

  27. I’m sure a lot of it is folks that had automatic billing and are busy folks that just keep putting off canceling the charge. Like I still made AOL payments for nearly 3 years after I no longer used the service. It was one of those little charges that if I saw it on the bank statement, it annoyed me for a few minutes and I’d tell myself I needed to call and cancel the account and genuinely thought I would. Back when I canceled you had to call in to cancel completely,couldn’t do it online. But I’d get distracted before I actually looked up a customer service phone number and called in. I moved on and then the next month I’d check the statement and think the same thing. Over and over, procrastination after procrastination for years. It was a waste and a shame. But I bet I’m far from alone.

  28. I’m not gonna lie, when I was younger, my parents left the decision of what internet we would have up to me (since I was the only one using it really). I didn’t want to give up AOL just because of the little cool features it came with and stuff only AOL users could get or go on. I got Bellsouth internet for free once and got mad when I saw it worked through IE (which at the time was boring and lame to me, lol). I eventually switched to my cable company’s internet, Comcast. I was so blown away by the high speed, I was like screw AOL! lolz. I dunno, I guess you can think of people with AOL like people with Mac computers. According to the stereotype (that I’m not saying I agree with) they pay for their high priced computers and they’re stuck up about it when they have a Mac computer and you have ur lame PC. They get perks and no viruses, you get viruses and retarded Windows (kind of agree with, lolz). Maybe it’s something like that… Perks will let people get or keep things that cost more.That’s how I look at it, lol…

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