How Was AOL Created?
- In the mid-1980s, few people outside of military personnel and university researchers were able to access the Internet, and there wasn’t much public information to access. In 1985, a startup company known as Quantum Computer Services Inc. announced an online service, called QuantumLink. It offered access to the Internet specifically for the Commodore 64 for a low subscription fee. This service was primarily developed by one of the company’s founders, Stephen McConnell Case, a businessman and marketing consultant. In 1989, Quantum developed an instant messenger application and an email application which included the greeting, “Welcome! You’ve got mail.”
- In 1991, Case, then the CEO, changed the company’s name to America Online. A year later, America Online announced that its users had access to an email gateway that allowed them to send and receive emails from other email services, such as CompuServe, MCI Mail, AT&T Mail and others. The URL for the gateway was “aol.com.” In 1993, America Online launched a new product that allowed users of the Windows operating system to access their America Online services using icons located on the desktop. That year, subscribers paid a fixed monthly fee of $9.99 for up to five hours of Internet access per month.
- Already with 250,000 subscribers, America Online began in 1993 an ambitious and costly marketing program which involved mailing a package that consisted of the AOL software and a free trial subscription offer, as much as 700 hours of free service, to homes and businesses nationwide. Initially, the software was included on floppy diskettes, and later on compact discs. These packages were directly mailed to homes, included in magazines and located at retail store checkouts. The strategy worked, according to a July 2006 article by "Target Marketing" magazine, because America Online focused on mainstream consumers, while competitors Prodigy and CompuServe targeted more technologically savvy markets. Between 1993 and 1997, America Online’s subscriber base grew from 250,000 to 8 million, and it was easily the largest Internet service provider in the U.S.
- In February 2003, AOL, then known as AOL Time Warner, suffered its first quarterly loss of Internet subscribers after years of steady growth. Still primarily a dial-up Internet service appealing to casual users, AOL was losing customers to broadband services offering much faster speeds, such as digital subscriber line (DSL) and cable Internet services. Over the following years, AOL continued to lose millions of customers and has shifted its core business model to news and information content through dozens of websites, such as TMZ (entertainment) and the Huffington Post (news).
