AOL to Continue Cutting Online Businesses

Struggling Time Warner unit AOL will eliminate three data storage online services as the company continues to struggle to try and draw in new users.  

“Bluestring, Xdrive and AOL Pictures will be sunset,” AOL executive vice president of products and marketing Kevin Conroy told employees in a leaked memo.  “These consumer storage products haven’t gained sufficient traction in the marketplace or the monetization levels necessary to offset the high cost of their operation. We have found that building media management applications within the context of a social experience is a more rapid and effective way to grow the business.”

The first product cut is Xdrive, an online storage service that aimed to get users to backup information from their hard drive to the Xdrive servers.  Saving data into the cloud has become popular; with Hewlett-Packard and others also offering similar services that helped kill off Xdrive.

AOL will also shut down AOL Pictures, the free photo storage library that let users share pictures both publicly and privately.

The final service to be shut down will be BlueString, an online media sharing web site that never was able to gain traction.

AOL was once the most popular internet service provider in the country, but it failed to keep up as Americans began to use broadband internet connections.  After announcing in 2006 AOL would transition from an online internet services company more towards advertising, it was expected a number of its services would be cut.

The AOL Instant Messenger (AIM) chat program remains the company’s most popular online service.  

The company recently bulked up its AOL Heath Web site, after adding Health.com, Healthcare.com and Caring.com as three new partners for the site.  The AOL Living network is one of the most popular AOL services, and includes AOL Home, ParentDish, AOL Food and StyleList.  

Although AOL is cutting several different online services, the brand may enter the sights of Microsoft, Yahoo and Google, depending on the company’s asking price.  After losing out on its bid to buyout Yahoo over a several month long period, Microsoft is said to be reportedly interested in AOL.

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