The media giant hinted at that this week when Don Logan, the executive who oversees America Online and Time Inc., said one reason for the company’s unexpectedly high subscriber losses was the result of “cleaning up the files.”
People familiar with the situation say part of the cleanup involves the termination of subscribers generated by a little-known America Online initiative. Starting in 2000, AOL began selling limited-usage online accounts in bulk for as little as $1 to $3 a month to its marketing partners such as Target Corp., J.C. Penney Co. and Sears, Roebuck & Co. A regular limited-usage subscription at that time cost about $10 a month, while a regular subscription was slightly more than $20. The retailers then could offer the online service to their employees for a discount and pocket the difference.
It isn’t clear how many of those subscriptions were offered to employees or even activated. And there are no rules governing the reporting of such subscribers. [WSJ.com] (subscription required).