Good and Bad News from AOL

Dennis Faas's picture

It has been a bittersweet day for America Online.

On the same morning the company announces that it has beaten industry giants Microsoft and Google in launching the first online storage system, the company has at the same time admitted that it must lay off 5,000 employees. The cuts represent nearly a quarter of the AOL's manpower, and are part of a massive restructuring effort across all of its international offices.

The hardest hit branches may be those located in Europe, as rumours abound that the entire United Kingdom arm of AOL could be severed. In desperation to regain some of its once-golden appeal, AOL has reportedly considered allowing free access to its email and security software for all of its broadband subscribers. (Source:

Clearly, the problem lies in AOL's insistence on maintaining some shred of a dial-up market. Microsoft has reported similar losses in maintaining that service, but the Redmond-based company has made no announcement of layoffs.

Obviously, AOL can only go up from here. While Microsoft still debates on whether it will call its new online storage device LiveDrive or SkyDrive, and Google's plans for the GDrive remain unclear, AOL has officially unveiled Xdrive. Details are already flooding in on Xdrive, including a free 5GB option that lets users store, access, and share files of any sort. For a still-unclear price, users will be able to access a 50GB version of the Xdrive from AOL. (Source:

The announcement is the culmination of a long development process since AOL purchased Xdrive -- a distributor of online backup storage devices -- in August of last year.

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