AOL Abandons Broadband

Plans Launch of Best-Price Travel Service

November 12, 2004
America Online was slow to get into the arena of broadband services. It's getting out a lot faster. Meanwhile, AOL is planning a plunge into the crowded waters of online travel.

The once-dominant Internet Service Provider stopped marketing its high-speed service earlier this year. Now, it's telling its existing customers they have to find another service provider if they want to continue receiving high speed internet services.

The first AOL broadband customers to feel the impact are those in nine southern states, who will lose their service January 17, 2005. An AOL spokeswoman says affected customers who take no action will find their service has reverted to dial up speed on that date.

The affected states are Florida, Kentucky, Georgia, Louisiana, Alabama, Mississippi, Tennessee, North Carolina and South Carolina. The company has not disclosed how many broadband subscribers it still has in those states. Service to the rest of the country will be phased out, region by region, over the next year.

Travel Plans

While abandoning broadband, AOL is planning a new travel search-engine that it says will search dozens of Web sites to find the best deals on travel.

This is hardly a new idea. Yahoo, SideStep and numerous other sites do essentially the same thing but AOL says its alliance with Kayak Software, a small Connecticut company, will give it the advantage.

Kayak, like many other best-price sites, doesn't sell tickets or make reservations -- it merely identifies what it thinks are the best deals and directs travelers to them. This could cause trouble for AOL's longtime partnership with Travelocity, which last month asked Kayak to stop listing its fares.

The established travel agencies are opposed to having their fares displayed by Kayak and similar companies. Expedia has also asked Kayak and similar sites to stop listings its offerings, calling the practice "almost parasitic."

Kayak is thought to be hoping to form direct relationships with airlines, hotels, car rental companies and other travel suppliers, which would generally prefer to deal directly with customers, rather than going through a travel agent.

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