Amazingly, AOL still has 3.5 million dialup subscribers
Laugh all you want, but as of the end of September, AOL still had 3.5 million subscribers to its dialup Internet access service — a lot more than the number of people who pay for, say, Spotify. And the decline from last year — about 630,000 subs — was AOL’s smallest Q3 shrinkage yet. (AOL credits a “price rationalization program” last quarter that helped them convert 200,000 people to an AOL access subscription.) This time in 2006 and 2007, AOL was losing 5 million customers a year.
According to AOL’s earnings release, the “average paid tenure” of its subscribers was about 10.6 years in Q3, up from about 9.4 years last year. (Of course, some of AOL’s existing access subscribers might not even realize they’re still paying for it.) But for those who don’t have access to broadband, don’t want it, or don’t need it, AOL is still better than no Internet access. Over the past decade, monthly AOL bills haven’t changed that much, on average: From about $18 in 2001 to $19.30 in 2006 to about $17.50 now.
What has changed is AOL’s overall size — much smaller now. And the bad news is that most of AOL’s profit still comes from its access business, which is — as depicted — in permanent decline.