The Carphone Warehouse have bought out the UK subsidiary of AOL in a deal worth £370m. It’s a somewhat bizarre merger in my view.
Even the names are odd. Take “America Online” but operating in the UK, and merge it with “Carphone Warehouse” whose name was compromised even by selling ordinary mobile phones, letalone branching into broadband and fixed-line phone services.
As to reputation: Well AOL has always been the butt of jokes at its questionable service (sending out landfill quantities of free trial CDs didn’t help much either), and the Carphone Warehouse has recently had a ton of complaints to good old BBC Watchdog for being a potential death trap – err, well OK not quite, but for providing a shoddy broadband service.
A merger?? Whoa. I bet AOL UK’s 2.1m subscribers are pleased…
Quite who’s going to inherit and maintain the AOL broadband connections I’m not sure yet. AOL are still advertising their services profusely, so presumably the companies are still going to keep their individual branding. There’ll be a degree of input from AOL/Time Warner in terms of content provision and advertising revenue sharing. CW will continue to charge AOL subscribers in the same way they are billed at present.
However it works, the deal will initially put CW in 3rd place, behind NTL:Telewest and BT, of residential Internet Service Providers.
What do you reckon to this deal? Good news or a mess?