Yesterday, AOL announced that
“most” of their services would be FREE going forward. All that great
content and all those services … FREE. If you read the FAQ, you can see how they
expect to make up for all the lost revenue …
1. Why Is AOL Doing This?
To give members more choice and
flexibility so they can get the online experience that’s right for them. As AOL
changes, other sources of revenue (such as advertising) will allow us to offer
many of our services free of charge.
I love this. It’s
another great validation that an advertising driven revenue model can work in
this day and age. In their case, AOL is betting their future that the ad model
will work better than the subscription based walled garden. It’s certainly
a big bet. The New York
Times reported that AOL will forgo at least $1.4B (that’s BILLION)
that it now earns in subscription revenue. Wow.
Ya think it’ll