"Starting today, AOL will no longer sell pop-up advertisements," AOL Chief Executive Jonathan Miller told an audience at the Lincoln Center for the Performing Arts.
"You're the ones who asked for this. We're giving members what they want." By ending the use of third party pop-ups, Miller said AOL would be an even better vehicle for advertising partners. Once the current advertising inventory for pop-ups runs their course, there will be no more, he said.
In this pop-up ban, AOL follows New York-based women's publisher iVillage, which made a big splash in the online advertising business by doing the same earlier this year. The much smaller company said it was making the change after polling its users about their feelings about the controversial ad format. What AOL will give up in terms of ad revenue remains to be seen. Miller later said the move would cost the company about $30 million in cash earnings.
Although some Internet users have vocally complained about the format, it has proven to be popular with direct response advertisers, which claim that pop-up ads produce a good response.
The news came amid a stream of executives of AOL Time Warner who took the stage at Lincoln Center's Avery Fisher Hall to proclaim the launch of AOL's much-ballyhooed version 8.0.
"The real stars are you," AOL Time Warner Chief Executive Richard Parsons told the crowd after singer Laura Pausini had finished a couple of songs. "We've gotten back to basics, giving you more of what brought you to AOL in the first place."
Parsons then asked "Uncle Ted", AOL Time Warner Vice Chairman Ted Turner, to join him. Holding a microphone aloft, and after exchanging "high fives" with Parsons, Turner said: "Watch out Bill Gates and Microsoft! Here we come!"
One person Turner did not join on stage was Steve Case, chairman of AOL Time Warner. Turner's criticism of the company's plunging stock price, among other issues, has been focused on Case in recent months.
Instead, Case came out a little later to banter with comedian and host Dana Carvey. Case appeared to take his jokes in stride until Carvey veered into his "Hans and Franz" characters from his days on Saturday Night Live. After joking that Case looked a little flabby and that he'd better not move lest he "cause a flabberlanche," Case appeared to shoot back at Carvey, joking that he needed "counseling."
While about 2,000 AOL subscribers took in the affair -- including extensive demos, gourmet food, gift bags and singer Alanis Morissette's performance -- AOL's archrival Microsoft managed to muscle some attention of its own.
During the festivities, about 70 roller bladers wearing purple body suits and butterfly wings on their backs rolled around outside the theater, many carrying signs such as "MSN 8 is on the way!" The "butterflies" served as a reminder to AOL of the $300 million that Microsoft is spending for the October 24th launch of its competing ISP product, MSN 8.0 (about $200 million more than AOL is spending on its 8.0 launch).
The multi-colored butterflies are part of Microsoft's teaser campaign as the software giant seeks to build awareness ahead of its own glitzy launch in New York and a concert featuring Lenny Kravitz.
At any rate, the no pop-ups announcement was among a flurry of thank-yous that AOL executives and staff sent to subscribers during the launch event Tuesday, a theme built around serving members and building community. The kudos arrive as AOL tries to stiff arm any potential competitive threat that Microsoft's upcoming release of its own ISP software may present.
Not only does MSN 8.0 offer similar features to AOL's 8.0, such as enhanced parental controls and spam filters, it includes a tool to help AOL users defect if they so choose. TrueSwitch was rolled out in May, and helps users migrate address book entries as well as calendar information into MSN's Internet service. Still, for all its efforts to poach AOL's base, MSN's 8 million subscribers still rank a distant second behind AOL's 35 million.