Every hour that the average user spends online, AOL pays for it directly, yet the average user only pays a flat rate of 21.95 a month. So if usage continues to go up, AOL's cost continues to increase and this is something they've started to control over the last several quarters.
More Quotes from Henry Blodget:
The biggest challenge AOL faces is really controlling its usage-based cost structure.Henry Blodget
With paid search, advertisers bid against each other for rank positioning on commercial search terms, paying each time a user 'clicks' on their result.
Henry Blodget
Near-term forecasts call for pain, especially in the travel sector.
Henry Blodget
Management maintained full-year 2001 target of 20-to-30 percent revenue growth. To be conservative, we are trimming our estimate from 3.3 billion to 3.2 billion.
Henry Blodget
A settlement as broadly described would represent a positive for the company and stock. Importantly, however, the states have reportedly not yet signed off on such a settlement, and without their support, the case will likely still head back to the district court.
Henry Blodget
At the same time, however, we continue to be discouraged by one basic trend a steady increase in our loss estimates without a correspondingly large increase in revenue or profitability estimates.
Henry Blodget
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