AOL Pushes Into the World of Blackberry

A pager element joins the AOL Anywhere strategy.
Author:
Publish date:

As yet another element of America Online's (AOL) ongoing preparation for the post-PC era, the company announced on Thursday the availability of a wireless device subscribers can use to exchange email and instant messages on the go.

Like the other services that AOL has announced in its AOL Anywhere strategy -- such as AOLTV and AOL by Phone -- the new AOL Mobile Communicator service isn't expected to significantly boost current revenue, though AOL hopes it will help keep subscribers loyal over the long haul.

On a bleak day for the stock market, AOL shares fell more than 6% to close at $40.61.

Research in Motion

(RIMM)

, the company building the wireless communicators that AOL subscribers will be using, rose more than 11% to $65.

Priced not much less than a cheap PC, the AOL Mobile Communicator appears to be a too expensive to be a widespread stocking stuffer this holiday season. The 4.1-ounce device, a version of RIMM's handheld-keyboard Blackberry pager, costs $329.95; the monthly fee for AOL subscribers is $19.95 a month beyond their basic subscription fee.

Merrill Lynch Internet analyst

Henry Blodget writes in a report that the devices will "eventually" be a big hit, though the $30 million to $35 million in revenues he expects them to generate for AOL in 2001 will be relatively small. Wall Street expects the combined AOL Time Warner to report $40 billion in revenue in 2001.

Blodget, whose firm has done underwriting for AOL, has a buy on the stock.