No LBC content...
SAfter last month, I thought that everyone, including Mark, might
like to see this...
America Online (AOL) said Thurs. it's increasing investment in
technology by $100 million and adding service representatives,
while at same time asking its members to reduce, at least
temporarily, their use of service. Announcements as well as letter
to now 8 million members from Chmn. Steve Case follows week in
which at least 3 more suits have been filed against service and in
which AOL suffered 5-hour technical problem that forced half of
system capacity offline. Stock closed Thurs. at $41.375 per share,
up $3.375 on volume of 4.3 million shares, among most active on
N.Y. Stock Exchange.
Company also is cutting back its ads, including suspending TV
commercials featuring theme from cartoon show, The Jetsons,, in
effort to slow growth of service. Case said emphasis now is on
serving existing customers better, rather than recruiting new ones.
>>CUT>>
Increased stress on service capacity has caused anger among
some members, resulting in at least 3 class-action suits filed this
week in N.Y., to go along with another one filed in Cal. seeking
$20 million in damages. Situation wasn't helped by service
disruptions 2 days this week, in one of which half of capacity was
taken offline between about 3 p.m. and 8 p.m. Wed. Online feature
"AOL Insider" reported to members Thurs. morning that technical
staff noticed that system was losing users about 3:15 p.m. and
didn't know why, and so half of service was shut down so that only
100,000 users could get on at once (system at full strength
supports 260,000) while technicians tried to figure out problem.
About 7 p.m., staff determined there was malfunction in router
computer component that directs data traffic flow. Router board
was replaced, and system was opened gradually to full capacity.
AOL said that to cope with problems, it was >>>cut>>>
Case told members: "There's also something you can do to
help, and that is to moderate your own use of AOL a bit during our
peak evening periods." He said that during upgrade, "it would be
helpful if you were sensitive to the needs and frustrations of your
fellow members." He said members can "use AOL as much as you want
during the day, but try to show some restraint at night during the
next few months." He pointed to one way traffic problem has
compounded itself: Practice of members who finally gain access
staying on line indefinitely to avoid reconnection hassles later.
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