EP Diary Forum

AOL, Prodigy & CompuServe: commercial on-line end game

The last two weeks have brought a lot of bad news for commercial on-line service companies. After writing off $385.2 million in marketing costs, America On-Line is laying off 300 people, changing to a flat $19.95/month pricing plan and closing its GNN Internet subsidiary. Prodigy, which moved a lot of smart people to New York's Soho to be near the multimedia action, has now pulled many back to its suburban roots as it tries to become a regular ISP. And CompuServe, which went public last April, posted a second quarter loss of $58 million and is discontinuing WOW!, its 7-month-old web service.

In the last few years, it's become clear that these companies are doomed in the face of the Internet. Since Prodigy started offering web access in January of 1995, the handwriting has been on the wall. But it's a shame, really. These firms (especially early ones like CompuServe, Delphi and the Source) pioneered home on-line computing, and now the freight train of history is running over them.

Those who live by high tech will die by high tech.