The Huffington Post notes a New Yorker article (sub req) by Ken Auletta who describes how America Online (AOL) makes its profit. The article claims that 80% of America Online’s profits come from subscribers, and 75% of those subscribers are paying AOL for something they don’t actually need.
According to Mr. Auletta AOL still gets eighty percent of its profits from subscribers, many of whom are older people who have cable or DSL service but don’t realize that they need not pay an extra $25.00 a month to get online and check their e-mail. “The dirty little secret,” a former AOL executive says, “is that seventy-five percent of the people who subscribe to AOL’s dial-up service don’t need it.”
The HuffPost says a full 60% of AOL’s profits come from mostly older misinformed customers who don’t realize that they don’t need to subscribe to AOL to get online. Although the number of subscribers has sharply decreased from thirty-five million in 2002 to just over four million today, that is still a hefty number of confused people getting nothing for their money.
In an update on the Huffington Post, it says that This post originally assumed that all of AOL’s subscribers received dial-up. According to AOL’s corporate communication office, there are various plans offered and dial-up is not included in all of them. However, AOL declined to say what percentage of subscribers did not receive dial-up.
The HuffPost points that this may not be a scam, as Business Insider mistakenly suggested earlier, but it does seem to suggest that AOL could be doing more to keep their customers informed about the service they offer. Business Insider provides a handy set of screen captures to show customers exactly how to unsubscribe.
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AOL really, they are still around?
Now that AOL has bought the Huffington Post would they carry this story?
When was the last time you used AOL?
Ralph Bach has been in IT long enough to know better and has blogged from his Bach Seat about IT, careers, and anything else that catches his attention since 2005. You can follow him on LinkedIn, Facebook, and Twitter. Email the Bach Seat here.