Originally created 03/19/00

Problems do not deter fans from login on to AOL

Its customers sometimes still grumble about busy signals, annoying ads that pop up after they sign on, software that trashes other Internet connections and, it seems, a gadzillion other things.

Regardless, America Online Inc. remains the Earth's most popular front door to the online world -- with 21 million members and more than 40 percent of the market, it's six times the size of its nearest competitor, EarthLink Inc.

To its critics, the answer to why AOL has been such a phenomenal success is one of the world's great mysteries. Perhaps its aggressive marketing, they speculate, the ubiquitous disks carpet-bombed across America and the family-oriented television plugs. Or maybe it's simply because people sign up for the initial free hours and then loathe to change their e-mail addresses.

"It boils down to one thing.°.°.°. We make it very easy to get online," says Barry Schuler, president of the company's interactive-services group.

This philosophy of creating a simple, newcomer-friendly service has surprised elitists who predicted the company's demise. All the while, technology novices continued to gravitate toward AOL, more than doubling its membership in the past three years. As the subscriber totals have zoomed upward, AOL has kept adding new modem lines and ramped up its technology so that some of the problems it experienced during the 1997 "access crisis" -- when hundreds of thousands of new users jammed the phone pools -- are no longer a critical problem. And once someone signs up for the service, experts say, it's difficult to leave. (How many members do leave is difficult to tell; the company treats its "churn rate" as classified information.)

Some say they use AOL because friends or family members have it; they say the service makes it difficult to chat with anyone from the outside -- consider AOL's recent fight with Microsoft Corp. over allowing MSN users to exchange "instant messages" with AOL users. But for all the criticism of AOL's "walled garden" approach, some users say it inspires a cozy sense of community while other Internet service providers, or ISPs, are simply conduits to the vast Internet.

Adam and Wendy Labenow, of Herndon, Va., met in a Jewish singles chat room on AOL. Mrs. Labenow, 32 and a middle-school teacher, describes the friends she has made on the online service her "extended family."

"They have been with us with happy times. When we announced our marriage through a mass e-mail, we got back all their well wishes. On a less happy note, when my father passed away recently, we sent out the same kind of notice and we got the same amount of support from people we've never met face to face but feel like we know," she said.

Can this take place outside AOL? Of course. But it can be much more confusing to navigate the array of newsgroups, Web forums and chat systems that sprawls outside AOL's gates.

Erik Brynjolfsson, director of the Center for eBusinessMIT, also says "bundled" solutions such as AOL are popular with consumers who don't want to go to the trouble of the "a la carte" way and pick a separate access provider, then a search and directory "portal" and then a news site and map provider and so forth.

"Some people buy AOL for the stock quotes, and some buy it for the horoscope. It appeals to a broader section of people," he said.

EarthLink -- which has a reputation as a more "sophisticated" service -- recently unveiled its Version 5.0 software, which looks eerily similar to AOL's and allows users to access basic services via one menu.

Meanwhile, AOL's own Version 5.0 program has become a controversy itself. Customers and competitors in Maryland, California and Washington are suing AOL, claiming that it hijacks computers and requires tedious tweaking for subscribers to reach other ISPs. Some observers say the suits could represent a public-image problem for AOL if they make the company look like a schoolyard bully, beating up other Internet providers for their lunch money.

AOL officials have said the suits have "no basis in fact or in law."

They also note that most AOL users don't have another Internet provider. Many of them rarely leave the service at all; among AOL's most popular features are proprietary tools that allow people to hold virtual conversations with other members -- mail, instant messaging and chats.

"It's really socializing," Mr. Schuler said, pointing out that users spend only about 13 percent to 15 percent of their time outside AOL on the Internet at large.


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