AOL needs to make broadband work

AOL is struggling to survive as an ISP. The free portal continues to grow, but AOL's traditional dial-up business could be sliding into obscurity, unless new initiatives under way succeed.

AOL has teamed up with leading telco's to provide a nationwide own label braoband newtork and are now working aggresivley to try and convert the dial-up customers they have left (they lost 7M in the last few years!) to broadband prices.

And they are taking some risks as they have increased the price of their dial-up service so it costs the same as their broadband offering. They hope to convert 1M dial up users this year. And they'll need to keep up with Comcast and Verizon.

AOL’s broadband service, with about 5M customers in the US, has failed to establish itself as a premium internet service while AOL’s dial-up service in the US has lost 7M subscribers over three years. By comparison, AT&T had 6.9M broadband customers at the end of 2005, while Comcast, the US cable group, was the biggest broadband supplier with 8.5M customers.

2006 could prove pivotal for AOL - they need to move fast.