ABSTRACT
America Online (AOL) was founded in 1985 to provide content and services to residential customers via dial-up modems - it changed its name from Quantum Computer Services in 1989 and was first publicly traded on the New York stock exchange in 1992. Typically for the time, AOL restricted its subscribers to its own e-mail service and content, but the subsequent growth of the Internet led AOL to add access to the World Wide Web. Because its Internet interface was user-friendly, and its extensive marketing proved highly successful, AOL was able to grow rapidly during the 1990s, achieving roughly a 40 per cent market share by the end of the decade. By comparison, its main rivals, Earthlink and Microsoft's MSN, had market shares well below 10 per cent. AOL did not produce its own content, but rather sought to provide access for its subscribers to the widest possible array of content produced by others. Its market power was such that it was increasingly able to charge prospective content providers a fee to become a 'preferred provider', and on the face of it, AOL's business model appeared to be working very well.
