Case Analysis of AOL

Principal Problems

Potential problems include the following:

• Online system still subject to busy signals during peak hours of usage
• AOL may experience difficulty in luring users away from their local ISPs in favor of an AOL account
• Large number of subscribers may be a hindrance with regard to negative publicity
• Customer service usually weaker when number of customers increases significantly
• Transition to information-appliance-based access
• Global & domestic competition (free and fee-based ISPs)
• Investing in new services without sufficient knowledge as to how to sell the service
• European entry without sufficient due diligence of markets

America Online is now a wholly owned subsidiary of AOL Time Warner Inc. Based in Dulles, Virginia, America Online is the world's leader in interactive services, Web brands, Internet technologies and e-commerce services. The parent company, AOL Time Warner, is the world's...