FREE online courses on Information Technology - Chapter 8 NETWORK &
COMMUNICATIONS IN I T - Commercial Network Providers
The current generations of U.S.
mass market services including Prodigy, CompuServe, Genie, Microsoft Network,
and America Online, is doing better than earlier attempts, although they, too,
have experienced slow growth. America Online appears to be the most successful
at the present time. Several services are thought to be profitable, even though
collectively they have relatively small markets. CompuServe caters to computer
users. The company does not break out earning by line of business, but one
research firm estimated that the company has a profit of $28 million a year from
its consumer-oriented on-line services.
Prodigy, a joint venture of IBM and Sears, is
family-oriented. It is rumored that IBM and Sears invested over one billion
dollars in Prodigy before selling it to a group of investors. America Online has
been one of the fastest growing mass market networks in the
U.S.
in addition to these large, commercial on-line services, hobbyists and small
entrepreneurs offer approximately 50,000 private bulletin boards, which offer
information and services to users.
While the hope of many network providers was to provide
average citizens a national market for goods, information, and other services,
these goals have not been fulfilled. Executives at Prodigy expected users to
shop marketing successes have been PC Flowers, which has grown to be one of
FTD's top five customers. However PC Flowers which has grown to be one of FTD's
top five customers. However PC Flowers had only $10 million in sales in 1993,
out of a total U.S.
flower market of about $10 billion. The new Microsoft Network begins with a
great advantage. By clicking on an icon on Window95, the user can register for
the network. Subsequently, logging on will only require clicking on an icon as
well.
All of these mass-market networks are threatened by the
Internet, a more open network with a great deal of free information. Each of
these networks provides access to the Internet in an attempt to retain their
subscribers. They are also threatened by MCI and AT&T., both of which provide
easy access by phone lines to the Internet. It remains to be seen how these mass
market networks will fare as the Internet expands.
