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How Much Did It Cost AOL To Send Us Those CDs In The 90s?

?A Lot!,? Says Steve Case

http://tctechcrunch.files.wordpress....eg?w=300&h=304

Quote:

If you lived in the United States in the 1990s, you remember these. They started as 3.5-inch floppies and transitioned into CDs. And I?m not exaggerating. I got one just about every single day. You?ve got mail, indeed.

If nothing else, it was ingenious marketing for AOL. While people eventually started bitching about getting spammed by the discs, most of those people probably also installed them at least once and checked out the service. So how much did that cost AOL?

?A lot,? says CEO at the time, Steve Case. Case himself took to Quora recently to answer the question: How much did it cost AOL to distribute all those CDs back in the 1990′s?

Case says that he doesn?t remember the total amount spent on the discs specifically, but says that in the early 1990s, AOL?s goal was to spend 10 percent of lifetime revenue to get a new subscriber. He says that since the average subscriber life was around 25 months, revenue was about $350 off of each of these users. So he guesses they probably spent about $35 per user on things such as these discs.

?As we were able to lower the cost of disks/trial/etc we were able to ramp up marketing. (Plus, we knew Microsoft was coming and it was never going to be easier or cheaper to get market share.) When we went public in 1992 we had less than 200,000 subscribers; a decade later the number was in the 25 million range,? Case recalls.

In other words, the discs worked.

Case also notes that the subscriber growth helped grow AOL from a market cap of $70 million at the time of their IPO to $150 billion when the merger with Time Warner occurred.

I repeat, the discs worked. Well, at least until that merger turned into a nightmare and had to be dissolved. A move which paved the way for the new-look AOL to purchase TechCrunch this year.

Another user on Quora looked over some numbers from the 90s and gave a more specific number for how much AOL spent on those discs: $300 million.

Update: Jan Brandt, AOL?s former Chief Marketing Officer has now weighed in as well:

Over $300 million :-) At one point, 50% of the CD?s produced worldwide had an AOL logo on it. We were logging in new subscribers at the rate of one every six seconds

http://techcrunch.com/2010/12/27/aol-discs-90s/

I wouldn't be surprised if snail mail makes a comeback

http://tctechcrunch.files.wordpress....pg?w=300&h=310

More On AOL?s Disc Strategy: $1.19 Floppies, 50% Of All CDs Made, And Precision Bombing

http://techcrunch.com/2010/12/28/aol-floppy-disk/

What I can remember is that they went as far as appearing next to cash registers in gas stations. I'm shocked that they are still in existence.

There are tons of people with the same @aol.com account.

Quote:

Originally Posted by DJ The Kid (Post 17805752)

?As we were able to lower the cost of disks/trial/etc we were able to ramp up marketing. (Plus, we knew Microsoft was coming and it was never going to be easier or cheaper to get market share.) When we went public in 1992 we had less than 200,000 subscribers; a decade later the number was in the 25 million range,? Case recalls.

and another decade later how many people are paying for AOL now, 25 ?:Oh crap

I remember those disks. I used to get a few in the mail every week. We used to grab them in bulk from stores who couldn't give them away quick enough and use them for whatever.

Quote:

Originally Posted by Rochard (Post 17805945)

I remember those disks. I used to get a few in the mail every week. We used to grab them in bulk from stores who couldn't give them away quick enough and use them for whatever.

Easily got over 100 disks & cds from them. Never signed up though.

nice strategy but 300million was big number at that time.

I miss floppy disks...

The coaster industry must have hated them.

Quote:

Originally Posted by Sarah_MaxCash (Post 17806063)

The coaster industry must have hated them.

Yes indeed :1orglaugh

AOL instant messenger ruled!

Do people still go to aol.com and why?

I had a table that was wobbly and those discs fixed it right up.

i fell for it - 1996 or 1997 - and it was damn hard to cancel a few years later

Quote:

Originally Posted by EthnicLover (Post 17807534)

Do people still go to aol.com and why?

:1orglaugh

Quote:

Originally Posted by MaDalton (Post 17807555)

i fell for it - 1996 or 1997 - and it was damn hard to cancel a few years later

I signed up in late 1996, and it took months to cancel the account. Worse yet, I could rarely connect because I almost always got a busy signal. So I paid for something that I couldn't connect to or cancel.

Nice introduction to the internet.