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    .COM LIVE

    Hosted by Leslie Walker
    Washington Post Columnist
    Thursday, June 3, 1999 at 1 p.m.
    Leslie Walker
    ".com" columnist Leslie Walker

    Welcome to ".com - Live," a real-time, moderated discussion with the people who are shaping the business strategies in the era of electronic commerce. My guest this week was Audrey Y. Weil, senior vice president and general manager of CompuServe.

    Audrey Y. Weil
    CompuServe SVP Audrey Y. Weil

    CompuServe, which was bought by America Online in 1998, is an online service aimed especially at small business users. We discussed the strategy behind CompuServe's offerings, including custom "portals" for industries, such as airlines. Several dozen commercial airlines, for example, allow their pilots to bid for flight schedules on CompuServe.



    Discussion Transcript

    Leslie Walker: Hello all and welcome to .Com Live.

    Here's a little background for anyone unfamiliar with CompuServe. It was born in 1969 and grew up to be one of the biggest online services. After H&R; Block bought it, the service thrived in the 1980s. But CompuServe went into a membership slide in the mid-1990s, and 1997 lost one-quarter of its members.

    America Online, once a much smaller rival, spurted in growth throughout the 1990s with a massive mailing of signup disks. AOL wound up buying CompuServe from WorldCom in February 1998. AOL installed Weil, a nine-year AOL veteran, at CompuServe last May, but kept the CompuServe service with its separate identity and set about trying to revive the ailing service.


    Leslie Walker: Hi Audrey. We're glad to have you on .Com Live today. Can you start by telling us what's happened to CompuServe in the 15 months since AOL took over. Has much changed?

    Audrey Weil: Thanks for inviting me, Leslie. I'm delighted to be here. We've made tremendous progress, and CompuServe is on a roll! We launched our CompuServe 2000 new version in February, and have had tremendously positive reception. People love the all HTML view of the service; the faster speed; the easier installation and registration, and, best of all, the terrific low price. CompuServe 2000 is just 9.95/month for 20 hours of use....an hour every business day....our professional, adult audience has really responded. We have a hit on our hands. :-)


    Leslie Walker: Ok, here's what a lot of folks want to know: why does America Online need to run a separate online service anyway--why not just fold CompuServe subscribers into AOL and have one big happy family?

    Audrey Weil: AOL, Inc is committed to being a multi brand company, and actually has many brands, including AOL, CompuServe, Netscape, ICQ, etc. We program the different services and different brands to unique audiences, and find a strong demand for the CompuServe product among the value-oriented, adult consumer. AOL is targeted more to the family, mass market online user. So, there will be a brand for everyone, as this market evolves.


    Houston TX: What is the hardest part about running CompuServe? And the most fun?

    Audrey Weil: Hello Houston; welcome! The most fun about running CompuServe is managing in such a dynamic marketplace, and working with all the very strong, bright people in Columbus and around the country that help make the service happen each and every day. The challenge is the stay current with the rapidly changing Internet technology....so the dynamic market makes it both fun and challenging.


    Orlando: Has CompuServe given any thought to making its Forum software available to the Net at large, for companies and such who need a good way to communicate?

    Audrey Weil: Hello Orlando! Yes, our forum technology is broadly recognized as the best on the Internet for threaded messaging, and we view it as a crown jewel of our business. We are considering how best to leverage it, but right now, you've got to join CompuServe to take advantage of it. :-)


    Washington, d.c.: Who is your main competition these days?

    Audrey Weil: Hello Washington! Our main competition is the set of basic, Internet-only service providers--Earthlink, Mindspring, MSN, ATTworldnet. Our advantage is that we offer a better value at 9.95 for 20 hours and 5 email names, or 19.95 for unlimited and 5 emails, Plus, we've got the Internet and More....we offer direct internet access plus 40 channels of content and built in instant messaging and email!


    Stamford, CT: How much time do you spend every day online, and how much is on the Internet instead of CompuServe? Also, what are your favorite Web sites?

    Audrey Weil: Hello Stamford! I spend all day online...and much of the night! Seriously, since this is my business, and by the way, I was with AOL for over 10 years before coming out to run CompuServe, so I am really an old timer at this, anyhow, I love the business, and spend a lot my time using our product. I like Ebay and eCircles; I'm particularly interested in the communication oriented web sites and how they are thinking about programming.


    Columbus, Ohio: Why have major airlines chosen CompuServe as the
    online service provider for their pilots and flight attendants?

    Audrey Weil: Hello Columbus! My own backyard. :-) CompuServe has a 20 year history with providing custom solutions to pilots and flight attendants, and is leveraging that experience by doing Custom Solutions for other vertical markets. We just launched CompuServe for Lawyers with American Lawyer Media (publisher of Natl Law Journal, etc>), and expect to do a lot more in this area.


    Washington, DC: What proportion of time do CompuServe users spend doing various activities like chat, email, instant messaging. Can you give us an overview of what the most popular activities on your service are?

    Audrey Weil: Hello Wash! Our members like using email, Internet, and instant messaging; they also enjoy news, weather, stock quotes and portfolios, and our premium services like Executive News Service.


    Bethesda Md: What is Compuserve position on Linux and what support does it-if at all- for Linux users?

    Audrey Weil: Hello Bethesda! We are watching Linux and also the portable devices like the Palm Pilot with interest, and will consider user interfaces when there is enough audience critical mass to justify the investment. We will go where the audience is!


    washington dc: So what will your strategy be in re-creating compuserve to be a content provider without having it compete with aol?

    Audrey Weil: Hi dc! CompuServe is much more than a web site/content play....we have a fully integrated online service, including full internet access, integrated email, instant messaging, and over 40 channels of content--so you've got it all with CompuServe. :-)


    Alexandria VA: How much advertising and e-commerce is CompuServe doing? do you have the same spam problem AOL does?

    Audrey Weil: Hello Alex! We just recently launched a CS credit card, and are doing advertising in the traditional ways with banners on our pages and some mentions in context on our pages....and we are being careful to monitor the balance of editorial and adv, based on our member's feedback. And we are very tough on spammers--we don't tolerate spamming of our membership!


    Leslie Walker: WE are more than halfway through this discussion, but keep your questions coming. Audrey is a fast typist, so she'll get to as many as she can!


    Leslie Walker: Audrey, you said a few minutes ago that your advantage is offering a "better value" at $9.95 for 20 hours of connect time, but I remember when MSN and AT&T and others offered even lower prices for a few hours a month, and it didn't seem like they signed up a lot of takers. What's the response has been to your 20-hour offer since it started a few months ago-how many takers?



    One big trend, especially in Europe, seems to be to offer totally free access and make money through advertising and commerce. How do you think that tend will affect the ISP business going forward? Do you think it will catch on in the U.S.?

    Audrey Weil: Leslie, thanks for asking about the interest in our 9.95 offer...it's interesting that we've seen tremendous response to it. I think there is real demand for a price plan for people that don't want to pay $20 for unlimited use; don't want to subsidize those that spend days online....they are lighter users that just get their email, info, messages, and get off, and want a lower monthly fee...that's what our 9.95 plan is about...an hour every business day...seems to be working!


    Leslie Walker: Audrey, you said a few minutes ago that your advantage is offering a "better value" at $9.95 for 20 hours of connect time, but I remember when MSN and AT&T and others offered even lower prices for a few hours a month, and it didn't seem like they signed up a lot of takers. What's the response has been to your 20-hour offer since it started a few months ago-how many takers?



    One big trend, especially in Europe, seems to be to offer totally free access and make money through advertising and commerce. How do you think that tend will affect the ISP business going forward? Do you think it will catch on in the U.S.?

    Audrey Weil: Leslie, it's interesting to see what's going on in Europe with the free ISP, particularly in England. I think that the regulatory loophole that allows the ISP subscription to be paid for by the local phone service fee is an anomaly, and that we won't see the same thing in other places. But, I do see an interest in consumers in paying lower rates for online access, and think that the free PC with a paid ISP subscription has a lot of potential to capture more people joining the Internet....we are working closely with PC manfs on that.


    San Francisco CA: What can you tell us about the usage patterns of CompuServe subscribers--are they any different from AOL's in terms of frequency and duration of access?

    Audrey Weil: hello SF! Our members are online less each day, but the interesting thing is that they are buyers! We see 80% of our audience has every bought something online, and our advertisers see some of their strongest advertising response anywhere on the net on CompuServe.


    Dulles VA: I heard a rumor that your husband works for a Net shopping site. Which
    one? And what's it like being married to someone who hangs out online as
    much as you do?
    ;--

    Audrey Weil: Hi Dulles! :-)
    Yes, the rumors are true...my husband runs the Victoria's Secret web site....so we are truly a cyber couple!
    I'm glad we are in the same business....because he's a lot more patient with me being online all the time, now that he's always online as well!


    Washington DC: Did Compuserve welcome their acquisition into AOL. I know there was a very strong opposition within the Netscape family, I wonder if CompuServe's employee's had similar hang ups. Have you personally encountered any hostility?

    Audrey Weil: Hi DC: I've worked with CompuServe staff for over a year now, and they've been really please to see the investment in the business, the growth, the new product releases, and the general momentum that AOL's ownership has brought the business. This is AOL's only business, and AOL has a lot of expertise to bring, to make COmpuSErve very successful.


    Washington DC: What has been Compuserve's relationship with Microsoft? Has this been changed by AOL's purchase?

    Audrey Weil: Hi DC: Our relationship with Microsoft has stayed steady through the AOL purchase....we integrate the browser into our CompuServe products, both older CompuServe versions as well as the new CompuServe 2000 release. They are also one of our biggest competitors, and so we continue to collaborate and to watch their every move very very carefully!


    © Copyright 1999 The Washington Post Company

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