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Love It or Hate It, AOL an Interesting Tale


In the introduction to her new book, "," Kara Swisher observes that America Online has spawned two large groups of people: those who "adore" the world's No. 1 online service, and those who "abhor" it. Her book, a detailed recounting of the company's history, "is for everyone else."

Actually, " How Steve Case Beat Bill Gates, Nailed the Netheads, and Made Millions in the War for the Web" (Times Business/Random House, 1998), is exactly for those folks who either love AOL or who love to hate AOL.

Unless you have strong feelings about the Dulles, Va.-based company that transformed the online industry, you probably wouldn't want to read 318 pages about it--especially when those 318 pages could have been condensed into about 150 pages.

At the end of the book, Swisher poses the inevitable question: Is AOL at its zenith, soon to be overcome by the much larger and ever-more-user-friendly World Wide Web? Or is AOL destined to become the most important brand in cyberspace? After all of her exhaustive research, I was looking forward to her insight.

Swisher's conclusion? "And the truth is: Nobody knows."

Gee, thanks.

Perhaps I shouldn't have been surprised. At the beginning of the book, Swisher explains that nobody knows what will happen to online companies because "in the spanking new world of the Internet . . . everyone and everything has just been born."

But AOL has been around--in one form or another--since 1982. Swisher traces its metamorphosis from Control Video Corp., an online video game company, to Quantum Computer Services, a provider of private-label online services for computer makers such as Apple Computer and IBM, to, finally, America Online.

The AOL service officially launched in October 1989, and it took about a year to sign up the first 100,000 members. AOL hit the 1-million-members mark in August 1994. But the company's management team never took its growing success for granted.

Neither does Swisher. She constantly reminds her readers of the enormous odds against AOL's success. First, the company's vision for an online video game service was far ahead of the mass market. Then the company ran short on capital. Next, it went head to head with Prodigy and CompuServe, two rival services backed by huge corporate parents. After that, Microsoft launched its own online service and bundled it with its ubiquitous operating system, Windows 95. Finally, AOL almost hanged itself by initiating an all-you-can-eat pricing plan before building out its computer network to handle the boom in traffic.

"AOL was nothing. AOL was history. AOL was dead," is Swisher's frequent refrain. AOL's stubborn refusal to go out of business caused its own executives to refer to it as the "cockroach" of the online industry.

OK, I get the point.

But AOL's eventual success--today, the company has a whopping $25-billion market cap--is not merely a happy accident. Swisher fleshes out some factors that drove AOL ahead of the pack, including:

* Chairman and Chief Executive Steve Case's vision to create a computer service that was easy for non-techies--like himself--to use.

* Marketing whiz Jan Brandt's bold plan to carpet-bomb America with AOL disks bearing free hours.

* AOL's laissez-faire approach to monitoring e-mail and chat rooms, allowing electronic communication on the service to thrive.

The book also reveals some other interesting slices of life, including an internal company debate in 1989 about whether America Online should go by the initials "AO" or "AOL." (Case lobbied for AOL, Swisher reports, hoping to emulate other successful companies with three letters such as IBM and AT&T.) Swisher also reveals that America Online looked into launching an adult-oriented content channel and that Case considered having AOL members vote on whether to switch to a flat-rate pricing plan.

But many of Swisher's anecdotes are distracting and do little to enhance the story. The book is overflowing with details like what clothes people wore and what food they ate, which serve little purpose except to show off how much information Swisher was able to gather.


Profiles of key executives are similarly frustrating. While they generally include exhaustive career histories, they rarely provide insight into why these people were attracted to such an underdog company or why they stuck with it for so long when it faced such long odds in an untested industry.

Nor does the book spend much time on America Online's legions of customers and why they stayed with AOL after a string of customer service blunders.

But "" will offer considerable satisfaction to die-hard AOL fans and critics who would have liked to have been flies on the wall inside one of the most influential companies in cyberspace.


Times staff writer Karen Kaplan can be reached via e-mail at

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