AOL's Schuler urges turf war truce - Broadcasting & Cable

AOL's Schuler urges turf war truce

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America Online President Barry Schuler exhorted cable and other media executives to back away from turf wars that have formed over broadband services to speed full
development of broadband products.

Speaking at the opening general session of CTAM's annual confention in San Francisco, "'Who owns the customer?', are the most paralyzing words in any of these industries," Schuler said, referring to one of the biggest points of
friction between cable operators and AOL and other
Internet providers. Cable operators, for example, have
traditionally sought to be the sales conduit for all
its services, which is why your HBO or Excite@Home
bill doesn't come from either of those companies. AOL,
on the other hand, wants to directly bill customers
using AOL-branded high-speed Internet service.

Schuler's solution is to find out how subscribers want
to buy and get billed for services. "No one owns
customers," Schuler said. "No one can own a customer
and force them to do things they don't want to do."
Further, "If everyone gets paralyzed by who owns the
custome, somebody else comes in a gets underneath."

However, he gave no indication during an interview
that AOL was dramatically relaxing its stance over
customer billing. He noted, however, that such turf
wars are crippling the development of products like
video on demand. Movie studios are reluctant to give
cable operators favorable movie "windows", worrying
about the possible damage to video rentals and sales.

"I've seen this movie over and over again,"Schuler
said. He said that it's important for deals to be
partnerships in which everybody wins, protecting
rights holders and distributors looking to exploit
content. However, he broadly encouraged executives to
"look at the glass as filled with opportunity, not
filled with problems," he said. - John M. Higgins

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