AOL believes less ads will equal more revenue

Gavin O'Malley from MediaPost has some excerpts from the Goldman Sachs conference where AOL execs CEO Randy Falco and Chief Operating Officer Ron Grant presented. I have been a customer of AOL since 1993 and still have the same username. Yet today, AOL is a distant memory for me except for checking the email and when my mum has issues accessing the service. AOL was the first most-hated company online and today is trying to reinvent themselves with their programs including the free service for users who bring their own connection.

From the article (includes my comments):

"Our ads are delivering better value for our advertisers," he said. It's all part of the six-month plan to relaunch all of AOL's products and content verticals, which Falco initiated when he took the company reins last November.

"We were behind in terms of product development," Falco admitted. "We know we're behind in sports and social networking," Falco added.  Hrm, behind? I would say they are laps down with a car with 3 wheels. I smell an acquisition.

"We need to open up AIM," said Grant, referring to AOL's hugely popular instant messaging service and how it could be integrated into other areas of a consumer's Web experience.

MapQuest, AOL's mapping service, is another area where the company has so far failed to capitalize, letting rival services like Google Maps move in on market share, he said.

MapQuest is a great example of an AOL property which has the lead in share of market but is losing on innovation. They finally rolled out dynamic maps and they still dominate the "my mum" segment but younger folks like myself are using Yahoo or Google for our mapping needs before thinking of the once-only choice MapQuest. I used to be a MapQuest loyal but don't know the last time I used them for directions.

Asked if AOL has an image problem with younger consumers, Falco insisted AOL is able to reach a broad range of consumers. This is a bunsh of hooey. AOL is absolutely not connected to the young twenty-something generation that now dominates the startup space. Can they get with this crowd? Sure, but it will take a lot of work and thought changing. It's just not cool to roll with AOL right now.

I still stand firm that a Yahoo-AOL merger would help both companies.