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June 9, 1997updated 05 Sep 2016 1:06pm

SURVEY POINTS TO MORE DEFECTIONS FROM AOL

By CBR Staff Writer

In what could turn out to be more bad news for Steve Case and Co, a survey conducted by the Emerging Technologies Research Group at FIND/SVP found that nearly half of America Online Inc subscribers who also use the internet – about 90% of the total – said they were somewhat likely or very likely to leave the service in the next few months, including 8% who say they will definitely leave. That translates into 1.3 million subscribers who are leaving or in the very likely to leave category. Not exactly what the company needs to achieve its stated goal of 10 million subscribers – up from the current 8 million – by year’s end. AOL’s recent difficulties in keeping subscribers is illustrated by the fact that 16% of US adults who currently use the internet have canceled an AOL account in the last 12 months. That figure is double the next-highest defection rate, at CompuServe Inc. Difficulty in trying to access the service is the primary reason cited by those who have left. A disturbing 41% of users said they experience trouble signing on half the time or more. Flat-rate unlimited usage, which was responsible for all the tie-ups, may have caused another problem as well. It has brought more people out of the chat rooms and onto the web, and as people become more comfortable using the web, they will most likely find less need for a frilly service like AOL. The only silver lining for AOL in the report concerns the emerging phenomenon of pass-along usage. The sharing of online accounts is becoming more commonplace and the new data indicates that actual users, as opposed to subscribers, of AOL services number about 10.6 million. If the company can substantiate these inflated numbers, it might help to bring in advertising revenues. The report was based on a survey of 1,000 internet users and 1,000 non-users.

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