AOL

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AOL.JPG
Type: Public
Industry: Internet
Founded: 1983
Founder(s): Jim Kimsey
Stephen Case
Headquarters: New York
Country: USA
Employees: 5860 [1]
Revenue: $2.417 billion as of 2010 [2]
Website: www.aol.com
Blog: Aol Blog
Facebook: AOL
Twitter: TwitterIcon.png@AOL
Key People
Tim Armstrong, Chairman & CEO

America Online (AOL) provides global web services, tools, platforms and maintains content sites in a variety of niches. The company also offers online advertising services to third-party websites. AOL also provides subscription-based access service for consumers in the U.S.[3]

History

AOL's origins can be traced to an online gaming company known as Control Video Corporation (CVC) that was founded by William Von Meister in 1983. Its only product was called Gameline, which was used by Atari 2600 players to download temporary games through a modem. When the game industry collapsed, CVC was nearly bankrupt. In order to save the company, its investors removed Von Meister as CEO. Jim Kimsey took over the position in May of 1985. He launched the company as Quantum Computer Services with Stephen Case. The company began providing online services, which resulted to the development of Quantum Link (Q-Link) for Commodore 64 and 128 Models. Q-Link is a modification of the Playnet System.[4]

Steve Case was responsible for winning significant contracts such as the partnership with Apple Computer for the Apple Link and with IBM for the PC Link. In 1991, the company's name was changed to America Online.[5] The company went public on March 19, 1992 and offered its stocks for $11.50 per share.[6] During the same year, AOL launched the internet e-mail gateway, which allowed AOL subscribers to send and receive e-mails to Internet users with interconnected systems from CompuServe, MCI Mail, AT&T Mail, AppleLink, Sprint Mail without creating separate accounts under those services. [7]

On January 11, 2001, America Online and Time Warner merged after the approval of the Federal Trade Commission.[8] [9] The company was named AOL Time Warner, Inc. AOL's Steve Case was named Chairman of the Board while Time Warner's Gerald Levine was appointed CEO.[10]

In 2005, AOL's Live 8 received an Emmy Award for non-traditional viewing platform. This made AOL the first Internet company to receive the prestigious award.[11] The following year, the company decided to offer free web contents and services and re-branded its corporate identity from America Online to simply AOL.[12]

In 2009, the company's running man icon was included in the Madison Avenue Advertising Walk of Fame.[13] On December 9th, 2009, the board of directors of Time Warner approved the spin off of AOL, and it became a separate and independent publicly traded company under the ticker sybol AOL at the New York Stock Exchange (NYSE).[14]

In 2011, AOL purchased the Huffington Post Media Group.[15]

Products and Services

AOL provides the following products and services:[16]

  • Content - The company maintains numerous sites that provide a wide range of contents in different industries including: Aol.com, Autoblog, AOL Autos, Black Voices, The Boombox, The Boot, Cambio, AOL Desktop, Daily Finance, AOL Defense, Ellen, AOL Energy, Engadget, Everyday Health, Games.com, AOL Government, AOL Real Estate, AOL Travel, Shoutcast, The Huffington Post, TechCrunch, AOL Travel, AOL Music and many more
  • Advertising-enables advertisers, publishers, companies and organizations to create awareness and establish their brand to their target audience or consumers through: Advertising.com, Adtech, AOL Video, 5MIn Media, goviral, Pictela, Content Solutions and Sponsored Listings.
  • Local- The company provides local content, platforms and services using MapQuest and Patch.
  • Applications and Commerce- AOL continues to provide consumer applications such as: Mobile Applications (Engadget Distro, Moviefone iPad app and Editions by AOL, AOL Mail, AIM and about.me)
  • Paid Services- AOL offers its subscription members with a VIP experience allowing them to purchase the products and service they need through Lifestore.com.
  • AOL Ventures- is the capital investment division of the company which provides start-up entrepreneurs the opportunity to grow.

ICANN Involvement

AOL was one of the first five registrars approved by ICANN in 1999 as part of the Internet governing body's test bed period to achieve its objective of increasing the competition in the domain name market, which, at that time, was dominated by Network Solutions.[17] It was most active within ICANN during the organization's inception, and the creation of such important policies as the registrar accreditation guidelines.[18] In 2010, AOL did not renew its registrar accreditation when it expired and the company is no longer an ICANN accredited registrar.[19] It had never been highly active in domain registration despite its participation in the aforementioned testbed; AOL peaked at registering 150,000 domains, but was only registering a dozen per year by 2009.[20]

In 1999, AOL participated in the ICANN Forum regarding the issue of the establishment of the Uniform Dispute Resolution Policy, which aimed to provide a speedy and affordable resolution to domain name disputes. In its comments, AOL praised ICANN’s initiative in appointing a drafting committee tasked to continue to deal with the issues raised by the Internet community and the realization of the implementation of the UDRP. According to AOL the UDRP needs additional revisions, such as:[21]

  • Sections 4(b) and 4(c)- AOL noted that the language of the entire section varies in a way with the anti-cybersquatting bills proposed by the U.S. Congress. The company suggested ICANN to revise the concept of the section in order to conform with international legal standards for abusive domain name registrations.
  • Section 4(c)- AOL suggested amendment to reflect the structure of Section 4(b)
  • Section 4(d)-AOL recommended that ICANN approved UDRP providers should be randomly assigned to resolve disputes regarding domain names.
  • Section 4(k)- AOL commented that UDRP and Rules should avoid jargon and minimize cross references to be easily understood by users.
  • Section 8(b)- The company assumed that the time period for the UDRP would be 15 business days not 15 calendar days.
  • Section 1 and Section 15(e)- The term "Reverse Domain Name Hijacking" is unnecessary and recommended that the “Abuse of Process” or “Procedural Misconduct” should be used instead.
  • Section 2(a)(iv)- AOL recommended that the provision should be removed

In 2009, Microsoft enlisted the help of AOL, ICANN, Verisign, Afilias, and others, to fight the Cornficker Worm, a particularly prolific virus that preyed on Microsoft systems. Microsoft also publicized a $250,000 reward for information able to convict anyone of intentionally spreading the worm.[22]

Acquisitions

Some of the most recent assets acquired by the company include:

  • Huffington Post Media Group- One of the major sources of news, opinion, entertainment, community, and digital information. The company was acquired by AOL in May, 2011. [23]
  • Pictela, Inc.- a company that provides global technology platform was acquired by AOL in December, 2010. It was to be added to the company's advertising division to provide high definition brand content, particularly for its Canadian clients.[24]
  • 5Min Media- the provider of website syndication platform was purchased by AOL in September, 2008, to build the company's video ecosystem to be able to provide powerful video capabilities.[25]
  • Thing Labs, Inc.- Acquired in September, 2010, it is a start-up web-based social software provider.[26]
  • TechCrunch- Provider of technology news, information and Analysis. The company was purchased by AOL in September, 2010.[27]
  • Bebo- A Social Network acquired by AOL in March, 2008.[28]
  • Buy.at- An Affiliate Marketing Network that was purchased by AOL in February, 2008.[29]

Legal Battles

Community Leader Program

In 1999, former AOL volunteers filed a class-action labor case against the company and requested the Department of Labor to investigate the case. The law suit was led by former volunteers Kelly Hallisey of New York and Brian Williams from Texas. According to their allegations, AOL violated the Fair Labor Standards Act by asking the volunteers to perform jobs, such as chat room monitoring, without compensation.[30] In 2001, the Department of Labor ruled that AOL did not violate the Fair Labor Standards Act since the volunteers were provided with free membership and free access to AOL proprietary sites in return for their services to the company.[31]

Double Billing Scheme

In 2003, another class action was filed against AOL due to allegations that the company was double-billing its subscribers for more than two years through a scheme called "spin-off sub-accounts". ICT Group, a division of Time Warner responsible for managing AOL's customer center, was also charged. According to the allegations, subscribers were billed two times for their subscription fees at the beginning and at the end of every month.[32]

In 2006, AOL signed a settlement agreement with the complainants of the double-billing class action law suit. According to Florida Attorney General Charlie Crist, AOL agreed to make consumer restitution and to forgive consumer debts related to the double-billing issue.[33]

Search Data Scandal

In 2006, AOL faced another class action law suit at the Northern California District Court after releasing 20 million search records from approximately 658, 000 members for a period of three months. The complainants alleged that the company violated the Electronic Communications Privacy Act and conducted fraudulent and deceptive business practices such as false advertising and unjust enrichment. AOL's action allowed anyone to see what each person was searching for, and their sensitive information such as credit card, telephone and social security numbers. AOL Search Data Release became a privacy scandal and the company's Chief Technology Officer resigned immediately. In addition, the company took steps to improve their privacy policy.[34] AOL apologized to the public through a statement:[35] "This was a screw-up, and we're angry and upset about it. It was an innocent enough attempt to reach out to the academic community with new research tools, but it was obviously not appropriately vetted, and if it had been, it would have been stopped in an instant. Although there was no personally identifiable data linked to these accounts, we're absolutely not defending this. It was a mistake, and we apologize. We've launched an internal investigation into what happened, and we are taking steps to ensure that this type of thing never happens again."

The Center for Democracy and Technology reacted to AOL's Search Data Release and expressed that it was a major privacy concern, but they were also relieved that AOL was serious in taking the necessary steps to resolve the issue. According to the CDT, "Companies that deal in search results have to understand that they carry very sensitive information, even if it doesn't have what we would traditionally consider to be personally identifiable information involved."[36]

Another complaint was made to the Federal Trade Commission by a San Francisco based digital rights group known as the Electronic Frontier Foundation.[37]


References

  1. Form 10K (2010)
  2. Form 10K (2010)
  3. About AOL:Overview
  4. Fools Rush In: Steve Case, Jerry Levin, and the Unmaking of AOL Time Warner By Nina Munk
  5. Quantum Link
  6. Stock History
  7. America Online Announces International E-Mail Gateway
  8. AOL-Time Warner merger approved
  9. AOL Time Warner: Timeline of the merger
  10. America Online and Time Warner Will Merge to Create World's First Internet Media and Communications Company
  11. Live 8 on AOL Wins Emmy
  12. America Online Changes Its Name to AOL
  13. AOL Running Man icon inducted in to Madison Avenue Advertising Walk of Fame
  14. Seeking Alpha-AOL Inc.
  15. AOL Agrees To Acquire The Huffington Post
  16. Products and Services
  17. ICANN Announces Five New Domain Name Registrars, Including AOL - Internet Corporation for Assigned Names and Numbers - Industry Trend or Event
  18. Comment Guidelines, ICANN.org
  19. AOL loses ICANN accreditation
  20. AOL Loses ICANN Accreditation, DomainIncite.com
  21. AOL Comments
  22. Microsoft Teams with Industry Leaders From AOL to Symantec to Fight Cornficker Worm
  23. Combination Accelerates AOL's Strategy to Create Next-Generation Media Company
  24. High-Definition Brand Content Platform Boosts AOL's Innovative Advertising Offering
  25. Combination of 5min Media and AOL's Video Capabilities Creates Powerful End-to-End Offering
  26. Brizzly Team Will Help Boost Social Interaction and Connection Across the AOL Network
  27. Leading Authority on Tech News Will Expand AOL's Growing Offering of World-Class, Audience-Relevant Content
  28. AOL To Acquire Global Social Media Network Bebo
  29. AOL Acquires buy.at Affiliate Network
  30. Former AOL volunteers file labor suit
  31. U.S. ceases probe of AOL labor practices
  32. Class Action Accuses AOL of Double-Billing Scheme
  33. STATE OF FLORIDA OFFICE OF THE ATTORNEY GENERAL DEPARTMENT OF LEGAL AFFAIRS- Assurance of Voluntary Compliance
  34. AOL Members Sue Over Search Data Release
  35. AOL apologizes for release of user search data
  36. AOL apologizes for release of user search data
  37. AOL faces FTC complaint over search data release