'AOL's Demise and What it Tells Us About the End Of The First-Mover Advantage' business businessstrategy
. While we go back over twenty years, there are some valuable lessons to learn from the whole story. Let’s see why, but first, let me give you a quick recap of what happened during these years.In the first wave of the commercial Internet the first big tech players and tech giants were walled gardens. Those platforms enabled access to proprietary networks where users could enjoy a set of online services . These first tech giants were companies like AOL, Prodigy, CompuServe, and GEnie.
was straightforward, you would pay for a monthly subscription, and enjoy a few hours of access to their proprietary networks. For each additional hour users spend on top of the subscription, they would be charged based on consumption.As AOL took over the Internet in the first wave of the mid-90s, it also opened up itsto more and more people, by changing its revenue model.
Yet by 1994, a group of young people that had also worked at Mosaic , also built a browser called Netscape, which by 1995 became very popular. Netscape drew the attention of Microsoft’s Bill Gates, which understood how browsers could become the gatekeepers of the Internet. This spurred a war between Microsoft and Netscape, which culminated in Microsoft’s release of Internet Explorer, bundled in its Microsoft Office products.
It enabled everyone to bid and compete on its advertising platform. Thus, making the paid search a primary feature. While this model, called CPC was revolutionary, it was also skewed substantially toward paid vs organic results. In that period, toward the end of the 1990s, another player had developed a search engine able to index, and rank the growing mole of web pages. This was first called Backrub, out of a P.h.d. project at Stanford.
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