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Google Finance, Govt, Policy and Business Issues Forum

    
AOL > Google
match made in heaven or hell?
Shak




msg:1234782
 5:36 pm on Mar 30, 2004 (gmt 0)

Had lunch with some interesting people today, and 1 of the topics that came up was AOL n Google teaming up to create 1 monster company (after aol departs from its current friends).

the basis for this seems "locked in users" which is what AOL has and Google is lacking compared to MSN and Yahoo.

I personally can see a lot of mileage in this, however I am neither a banker or a VC, so have NO idea what will happen.

any thoughts?

Shak

locked in users = registered members, such as MSN Hotmail, and Yahoo mail etc

 

steve40




msg:1234783
 5:58 pm on Mar 30, 2004 (gmt 0)

Heaven or Hell

AOL is known for milking its customer base and is loosing market share , so depends if you see it as google moving to AOL mindset or AOL moving to google mindset

depends which way would end up tail wags the dog or dog wags the tail

but Google could use locked in dbase i.e. messenger email ISP tie ups .
It would be a shame after IPO if bean counters looked at both businesses and only looked at Profit per eyeball and defined AOL most profit per visitor and then google might be tainted by such a move
steve

Chndru




msg:1234784
 6:03 pm on Mar 30, 2004 (gmt 0)

"locked in users" is honestly over-rated, from perspective of G. When was the last you checked weather in MSN, though you have a hotmail acct?

In the current google's view as a search and media company, it does not need to lock them. They have G Toolbar all over the places :)

Shak




msg:1234785
 6:10 pm on Mar 30, 2004 (gmt 0)

chndru,

I have to disagree with you on your point.

as I read somewhere "it took you 2 seconds to convert to Google from Yahoo, msn or whatever, it will take you another 2 seconds to move along again"

eyeballs, and signed in eyeballs is what is required.

Shak

Chndru




msg:1234786
 6:22 pm on Mar 30, 2004 (gmt 0)

2 seconds to convert to Google from Yahoo, msn or whatever

Yup. There in lies the point. Apparently, Yahoo or MSN's "locking-in" didn't prevent you from changing to Google.

How different is Yahoo or MSN from AOL? It would still take 2 seconds to change from Google+AOL to Yahoo or MSN.

imho, "Locking in" is not the solution for that.

bruhaha




msg:1234787
 6:25 pm on Mar 30, 2004 (gmt 0)

eyeballs, and signed in eyeballs is what is required

Isn't that precisely one of the things that has ended up costing AOL users? Who wants to be "locked in"?

I think the main reason for many signing up with AOL was convenience -- an easy way to get hooked into this new "internet thing" they didn't quite understand. But after a decade for people to get used to the whole idea the transition hardly seems as threatening anymore, and AOL seems more limiting than helpful.

So... why would Google want to sign on with this dying model?

martinibuster




msg:1234788
 6:29 pm on Mar 30, 2004 (gmt 0)

Locked in users is absolutely critical for Google's viability, hence Orkut and the email project, etc.

If you're having a hard time wrapping your minds around the concept of locking in a user base, then reconsider Shak's comment about it taking 2 seconds to like another search engine and ditch Google.

What kind of business plan is it that states their user base is dependent on the whim of their user base? Come on folks, please take a moment to catch up with this, it's Business 101, basic. Even drug dealers deploy the lock on users.

An AOL Google merger makes sense on many levels. In light of rumours that MSN was sniffing around AOL, it may be best to keep that piece of meat away from MS.

On the other hand, AOL's corporate bureacracy, declining user base, and it's lagging broadband adoption make it a... fixer-upper.

Earthlink would make a better match as it's well positioned for growth, is well ahead on rolling out broadband, is nimble, and even has a software R&D department.

If Earthlink and AOL were housing property, AOL would be an older house with bad plumbing and sketchy electrical wiring, located in a not nice neighborhood. Earthlink is a newer home in a nice neighborhood located near good schools and a couple of pubs.

[edited by: martinibuster at 7:26 pm (utc) on Mar. 30, 2004]

digitalv




msg:1234789
 6:37 pm on Mar 30, 2004 (gmt 0)

As long as they don't make the Google toolbar have a "1000 Free hours of AOL" button on it, then I'm fine with it.

Chndru




msg:1234790
 6:46 pm on Mar 30, 2004 (gmt 0)

martinibuster, it has nothing to do with Business 101.

If "locking-in" is supposedly such a powerful concept, what more "lock-in" could you do than having a search button on the world's most widely used browser and re-directs you to their search for any URL typos? If it were true, MSN would have the largest pie of market share.

Would you rather have a business model on forcefully locking users in or having a loyal user base?

loanuniverse




msg:1234791
 9:41 pm on Mar 30, 2004 (gmt 0)

AOL, even with its shrinking customre base, is a cash cow. There was an interesting article on Businessweek this week or last about how TW is looking to unload it, but has to wait for some items to clear up. Also debt that is assigned to the unit is less than US$3BB, which is frankly much less than I would have thought.

HughMungus




msg:1234792
 6:35 pm on Mar 31, 2004 (gmt 0)

"locked in users" is honestly over-rated, from perspective of G.

Of course it's over-rated from Google's perspective -- because they don't have locked-in users. What do you think they'll say? "Yeah, Yahoo is a better advertising platform because they have locked-in users."

AOL + Google might be a good move if Google can somehow get the managers at AOL to understand why people sign up for and use AOL (hint: it ain't for content).

HughMungus




msg:1234793
 7:44 pm on Mar 31, 2004 (gmt 0)

Would you rather have a business model on forcefully locking users in or having a loyal user base?

I think you're confused about the term "locked in users". It has nothing to do with forcing anyone to do anything. It means that you have users coming to you for one thing (e.g., mail) who then use your other services (e.g., search).

rcjordan




msg:1234794
 7:48 pm on Mar 31, 2004 (gmt 0)

2 predictions:

#1 - It'll happen.

#2 - 18 months after, Google will regret it.

martinibuster




msg:1234795
 5:52 am on Apr 1, 2004 (gmt 0)

It means that you have users coming to you for one thing (e.g., mail) who then use your other services (e.g., search).

Well HG, it happened. As is reported in other threads, Google has finally launched it's email application which will lock in users.

As was reported in the New York Times [nytimes.com],

E-mail has become a crucial weapon in the competition to win the allegiance of Internet users, who often turn to one or two Web sites as the foundation for their online activities...

That's what we are talking about when we say, Locked In. It has nothing to do with force. It's about satisfying a need. In this case, a user-focused email application.

It could also be providing a user-focused ISP.

RobbieD




msg:1234796
 8:43 am on Apr 1, 2004 (gmt 0)

Google need a Portal Period.

Chndru




msg:1234797
 3:48 pm on Apr 2, 2004 (gmt 0)

>>It means that you have users coming to you for one thing (e.g., mail) who then use your other services (e.g., search).

Ahh, Thanks Hughmungus. I stand corrected.

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