Can AOL Reinvent Itself?

The company just turned 25.


Dial-up Internet access is, by and large, a creature of the past. "You've got mail!" is no longer the standard greeting that Americans receive when switching on their computers. And with the rise of Twitter and Facebook, chat rooms have lost their stranglehold over the ever-expanding social networking industry.

[See U.S. News's list of the The 100 Best Mutual Funds For the Long Term, and use our Mutual Fund Score to find the best investments for you.]

Despite all of that, AOL executives remain confident in their ability to reinvent the company that helped to pioneer the Internet. Still badly beaten from its ill-fated merger with Time Warner (the two companies have since parted ways), AOL is now looking to grow its brand, largely through its content-production outlets. These outlets, which include and, outsource articles—for the most part to anyone willing to take them—in an attempt to capitalize on mass-distribution models.

Monday marks AOL's 25th anniversary. To get a sense of what's on the horizon for the company, U.S. News spoke with Tim Armstrong and Steve Case. Armstrong is AOL's CEO, and Case co-founded the company back in 1985. Excerpts:

[See 10 Cool Gadget Gifts for Grads.]

When the company launched 25 years ago, what visions did its founders have for how the Internet would evolve?

SC: Obviously, 25 years ago was the early days, kind of the pioneering days, when we were talking about the concept of the Internet. At the time, virtually nobody used it, and very few people even understood what we were talking about. But we believed even back then that someday it would be a ubiquitous medium that would be really as ubiquitous as television or radio.

How is AOL currently dealing with competition from newer companies that themselves are pioneering new ways of using the Internet?

SC: The key evolution obviously for AOL is that in the first 10, 15 years in particular, it really was about providing access to the Internet. It was really kind of giving people a way to connect to the Internet in the first place. So it meant network services and software to make it easy to use, as well as a whole array of offerings. And now the focus is more on the specific offerings because people have a variety of different ways to access the Internet.

How can AOL leverage the power of evolving forms of media?

TA: If you look at what AOL brought to the world, it was access. If you look at what Facebook and Twitter and those guys are bringing to the world, it is also access. And behind every piece of access is a piece of content. That can be somebody's individual tweet, it can be a link to an article, it could be a video. And I think what we're focused on is really looking at the offerings that we're bringing to the Internet and being agnostic as to where they go.

SC: The role that AOL has always played and will continue to play is really as an enabler and a facilitator and, to some degree, kind of an editor and simplifier. You want to give people the tools to create content, which obviously has always been a core [mission]. But at the same time, if everybody's creating content, it can be kind of noisy. And really helping people find the content that is most useful to them is a role that's important to play.

AOL both aggregates content and produces some of its own. Is the company moving more in the direction of content production?

TA: I would consider us moving in the direction of all things content. I think you see us hiring some of the best journalists in the world. You see us launching innovative technologies. Seed is going to allow hundreds of thousands of people to get online and create higher-quality content. And then you see things like Patch, where we're actually digitizing individual communities in the U.S.—and eventually beyond—which will allow a lot of people in local communities to do the core things that AOL talked about early on: connecting people, building communities, and building commerce in a very community-centric way. If you take a step back and ask, 'What's the business model behind that?' I think the business model comes down to two things, which are very powerful. One is … this digitally connected world is going to grow and expand, and there's going to be more and more of a growing need for more things to be online. And the second piece is consumers have migrated. It's been a very significant global migration. Most companies in the world that need to reach those consumers are going to need to follow them.