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AOL LLC (formerly America Online, Inc) is an online service provider, bulletin board system, and media company operated by Time Warner. AOL is based in Dulles, VA. With regional branches around the world, the former American "goliath among Internet service providers"• on several continents. In 2000, AOL and Time Warner announced plans to merge, a deal approved by the FTC on January 11, 2001. The total value of AOL stock subsequently plummeted from about $226 billion to about $20 billion.• News reports in fall 2005 identified companies such as Yahoo!, Microsoft, and Google as candidates for turning AOL into a joint venture•; those plans were apparently abandoned when it was revealed on December 20, 2005 that Google would purchase a 5% share of AOL for $1 billion.
History
Beginnings
Massive growth Case positioned AOL as the online service for people unfamiliar with computers, in particular contrast to CompuServe, which had long served the technical community. The PlayNet system that AOL licensed was the first online service to require use of proprietary software, rather than a standard terminal program; as a result it was able to offer a graphical user interface (GUI) instead of command lines, and was well ahead of the competition in emphasizing communication among members as a feature. In particular was the Chat Room concept from PlayNet, as opposed to the previous paradigm of CB-style channels. Chat Rooms allowed a large group of people with similar interests to convene and hold conversations in real time, including: AOL quickly surpassed GEnie, and by the mid-1990s, it passed Prodigy (which for several years allowed AOL advertising) and CompuServe. Originally, AOL charged its users an hourly fee, but in 1996 this changed and a flat rate of $19.99 a month was charged. Within three years, AOL's userbase grew to 10 million people. During this time, AOL connections would be flooded with users trying to get on, and many canceled their accounts due to constant busy signals. Also, games which used to be paid for with the hourly fee migrated in droves to the Internet. AOL was quickly running out of room in 1996 for its network at the Vienna, VA campus and and moved to Dulles, VA a short distance away. The move to the Dulles took place in 1997 and provided room for future growth. AOL was relatively late in providing access to the open Internet. Originally, only some Internet features were accessible through a proprietary interface but eventually it became possible to run other Internet software while logged in through AOL. They were the first online service to seamlessly integrate a web browser into content. AOL introduced the concept of Buddy Lists, leveraging their one-on-one instant messaging technology. Change in focus Since its merger with Time Warner, the value of AOL has dropped from its $200 billion high and it has seen similar losses among its subscription rate. It has since attempted to reposition itself as a content provider similar to companies such as Yahoo! as opposed to an Internet service provider which delivered content only to subscribers in what was termed a "walled garden". In 2005, AOL broadcast the Live 8 concert live over the Internet, and thousands of users downloaded clips of the concert over the following months. AOL eventually announced plans to offer subscribers classic television programs for free with commercials inserted via its new IN2TV service. At the time of launch, AOL made available Warner Bros. Television's vast library of programs, with Welcome Back Kotter as its marquee offering. Other shows include Scarecrow and Mrs. King, The F.B.I., F Troop, and Growing Pains. In 2006, AOL informed customers that it would be increasing the price of its dial-up access to $25.90. The increase was part of an effort to migrate the service's remaining dial-up users to broadband, as the increased price was the same price they had been charging for monthly DSL access. • However, AOL has started offering their services for $9.95 a month for unlimited dial-up access. • On April 3, 2006, AOL announced that the full name "America Online" will be retired, and that the official name of the service is now "AOL".• On August 2, 2006, AOL announced that they will give away e-mail accounts and software previously available only to its paying customers in a strategy shift likely to accelerate the decline in its core Internet access business. The decision removes the few remaining reasons for many AOL subscribers to keep paying when they already have high-speed Internet access through a cable or phone company. AOL hopes that by making services free, it can draw Internet users to its ad-supported Web sites and keep them from defecting to Microsoft and Yahoo!, which have offered free e-mail for years. CD-ROM distribution AOL was able to rapidly bolster its growth by mailing out sign-up diskettes and CD-ROMs containing free trials to hundreds of millions of households. Once offering only a few hours of free service, the discs now include up to a month's worth of free subscription time. This long and relentless campaign has produced a backlash, however. One program, called No More AOL CDs, seeks to gather one million unwanted AOL CDs and dump them at AOL headquarters. Other organizations have objected upon both environmental and privacy grounds; for example, many environmentalists say that AOL's CDs are largely unwanted and result in massive non-biodegradable plastic waste. Others view AOL disks as valuable collectible items due to the vast number of CD-ROM design variations. Community Leaders Prior to mid 2005, AOL used volunteers called Community Leaders, or CLs, to monitor chatrooms, message boards, and libraries. Some community leaders were recruited for content design and maintenance using a proprietary language and interface called RAINMAN, although most content maintenance was performed by partner and internal employees. In 1999, Kelly Hallissey and Brian Williams, former Community Leaders and founders of an anti-AOL website, filed a class action lawsuit against AOL citing violations of U.S. labor laws in its usage of CLs. The Department of Labor investigated but came to no conclusions, closing their investigation in 2001. In light of these events, AOL began drastically reducing the responsibilities and privileges of its volunteers in 2000. The program was eventually ended on June 8, 2005. Current Community Leaders at the time were offered 12 months of credit on their accounts. Billing disputes AOL has faced a number of lawsuits over claims that it has been slow to stop billing people after their accounts have been cancelled, either by the company or the user. In addition, AOL changed its method of calculating used minutes in response to a class action lawsuit. Previously, AOL would add fifteen seconds to the time a user was connected to the service and round up to the next whole minute (thus, a person who used the service for 11 minutes and 46 seconds would be charged for 13 minutes). AOL claimed this was to account for sign on/sign off time, but because this practice was not made known to its customers, the plaintiffs won (some also pointed out that signing on and off did not always take 15 seconds, especially when connecting via another ISP). AOL disclosed its connection time calculation methods to all of its customers and credited them with extra free hours. In addition, the AOL software would notify the user of exactly how long they were connected and how many minutes they were being charged. Account cancellation In response to approximately 300 consumer complaints, New York Attorney General Eliot Spitzer’s office began an inquiry of AOL’s customer service policies. The investigation revealed that the company had an elaborate system for rewarding employees who purported to retain or "save" subscribers who had called to cancel their Internet service. In many instances, such retention was done against subscribers’ wishes, or without their consent. Under the system, consumer service personnel received bonuses worth tens of thousands of dollars if they could successfully dissuade or "save" half of the people who called to cancel service. For several years, AOL had instituted minimum retention or "save" percentages, which consumer representatives were expected to meet. These bonuses, and the minimum "save" rates accompanying them, had the effect of employees not honoring cancellations, or otherwise making cancellation unduly difficult for consumers. Many consumers complained that AOL personnel ignored their demands to cancel service and stop billing. On August 24 2005, America Online agreed to pay $1.25 million to the state of New York and reformed its customer service procedures. Under the agreement, AOL will no longer require its customer service representatives to meet a minimum quota for customer retention in order to receive a bonus. However, many AOL users outside New York still claim to have problems cancelling their accounts. On June 13, 2006, a man named Vincent Ferrari documented his account cancellation phone call in a blog post, stating he had switched to broadband years earlier. In the recorded phone call, the AOL representative refused to cancel the account unless the 30-year-old Ferrari explained why AOL hours were still being recorded on it. Ferrari insisted that AOL software was not even installed on the computer. When Ferrari demanded that the account be canceled regardless, the AOL representative asked to speak with Ferrari's father, for whom the account had been set up. The conversation was aired on CNBC. When CNBC reporters tried to have an account on AOL cancelled, they were hung up on immediately and it ultimately took more than 45 minutes to cancel the account.• On July 19, 2006, AOL's entire retention manual was released on the Internet. * (7MB PDF) On August 3, 2006, Time Warner announced that the company would be dissolving AOL's retention centers due to its profits hinging on $1 billion in cost cuts. The company estimates that it will lose more than six million subscribers over the next year. * Software In 2000, AOL was served with an $8 billion lawsuit alleging that its (now dated) AOL 5.0 software caused significant difficulties for users attempting to use third-party Internet service providers. The lawsuit sought damages of up to $1000 for each user that had downloaded the software cited at the time of the lawsuit. AOL later agreed to a settlement of $15 million, without admission of wrongdoing. Now, the AOL software has a feature called AOL Dialer, or AOL Connect on Mac OS X. This feature allows users to connect to the ISP without running the full interface. This allows users to use only the applications they wish to use, especially if they do not favor the AOL Browser. Usenet newsgroups When AOL gave clients access to Usenet in 1994, they hid at least one newsgroup in standard list view: alt.aol-sucks. AOL did list the newsgroup in the alternative description view, but changed the description to "Flames and complaints about America Online". With AOL clients swarming Usenet newsgroups, the old, existing user base started to develop a strong distaste for both AOL and its clients. The AOL clients got renowned for their one- or two-worded replies, saying nothing more than "me too" and the likes, contributing absolutely nothing to the overall discussions. Thus, whenever someone today writes "AOL" in a post, they usually mean "I agree" or some intentionally stupid comment with reference to the early days of AOL clients' access to Usenet. This is frequently written in pseudo-html (arguably XML) as " Terms of Service (TOS) There have been many complaints over rules that govern AOL's members conduct, called the Terms of Service, which apply to everyone who uses AOL, regardless of age, or where an AOL member is on the Internet. Claims are that these rules are too strict to follow and do not allow swearing. TOS is known as COS (conditions of service) in the UK. Certified e-mail In early 2005, AOL stated its intention to implement certified e-mail, which will allow companies to send email to users with whom they have pre-existing business relationships, with a visual indication that the email is from a trusted source and without the risk that the email messages might be blocked or stripped by spam filters. This decision has drawn fire from MoveOn, which characterizes the program as an "e-mail tax". Esther Dyson defended the move in a New York Times editorial saying "I hope Goodmail succeeds, and that it has lots of competition. I also think it and its competitors will eventually transform into services that more directly serve the interests of mail recipients. Instead of the fees going to Goodmail and AOL, they will also be shared with the individual recipients."• Censorship in mainland China AOL, along with Google, Microsoft, Yahoo, Cisco, Skype, and others, has cooperated with the Chinese government in implementing a system of Internet censorship in mainland China. Many critics of these corporate policies argue that it is wrong for companies to profit from censorship and restrictions on freedom of the press and freedom of speech. The alternative, however, is censorship of the entire website. Human rights advocates such as Human Rights Watch and media groups such as Reporters Without Borders point out that if companies would stop contributing to the authorities' censorship efforts the government could be forced to change. Search data release On August 4, 2006, AOL released a compressed text file on one of its websites containing twenty million search keywords for over 650,000 users over a 3-month period, intended for research purposes. AOL pulled the file from public access by August 7, but not before its wide distribution on the Internet by others. Company purchases As it grew, AOL purchased many other software companies, including: Notable persons associated with AOL McAfee AOL includes McAfee VirusScan and McAfee Firewall Express for its subscribers. Upon introduction, McAfee VirusScan was 8.0 and Firewall Express was 5.0. Initially, it was only available to subscribers using AOL 8.0 and 9.0 software; but has since become available to anyone using versions as old as 6.0. AOL Keywords Keywords are words or phrases that act as shortcuts to AOL areas and Web sites. For example, to view football news and results, you go to AOL Keyword: Football. Many companies used to pay AOL to have their content featured as an AOL Keyword. One used to see AOL Keywords listed on products or in advertisements in much the same way that Web URLs are used today. Some AOL keywords at AOL USA, AOL Germany, AOL Canada or AOL UK only work in these countries and cannot be used by AOL customers in other countries (and vice versa). Every other country (where AOL is available) has its own AOL keyword(s). Free services
Xdrive Xdrive is a service offered by AOL which allows users to backup their files over the Internet. The service provides a free 5 GB account (free online storage) to anyone who has, or is willing to sign up for a free AOL screenname. Xdrive also offers remote backup services or higher levels of storage for monthly fees. Movie studios partnership On Friday, August 25, 2006, AOL announced that it had signed a deal with the major movie studios to open an online video store allowing users to "download to own" full length movies and television shows. The deal was signed with News Corp.'s 20th Century Fox, Sony Corp.'s Sony Pictures Home Entertainment, NBC Universal's Universal Pictures, and Time Warner Inc.'s Warner Bros. Home Entertainment Group See also Footnotes | |||||||||||||||||||||||||||||||||||||
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