Earthlink is going back to basics. The company has tried several failed ventures involving broadband and now has decided to start gathering dial-up customers. It seems that Earthlink has a plan to buy customers from other ISP’s who don’t want dial-up since it is not as lucrative as broadband. But will this work?
According to this article, here is what Earthlink plans:
Plagued by an eroding customer base, EarthLink has managed to stay afloat — and even turn a profit in the first quarter after losing $135 million in 2007 — by slashing its work force in half and abandoning two failed ventures. Now, it’s crunch time. CEO Rolla Huff is banking the company’s future on the very thing that has caused trouble in the first place: dial-up.
Huff has been saying for months he is serious. He has argued that he can’t stop losing customers to broadband but what he can do is buy dial-up subscribers from other companies that don’t want them and build a critical mass.
It’s unclear whether that strategy will work.
“The old core Internet service provider business that was central to EarthLink and AOL is really fading away and drying up,” said Lydia Leong, an analyst for Gartner, an information technology research company in Stamford, Conn. “They are a company with declining fare and declining brand equity.”
Interesting. While the world switches to broadband, Earthlink wants to go backwards and use dial-up customers to try and stop its decline. What next. American Airlines bringing back the steam locomotive? 🙂
What do you think? Is Earthlink on the right track? Or are they dreaming the dream?