RealTime IT News

Brazil Snubs AOL, Again

America Online, Inc., just can't catch a break in Brazil.

Brazil's council for ethics of the National Advertising Self-Regulation Council (CONAR) this week banned AOL from using its advertising slogan, "The largest because it is the best," in television, print and radio promotions throughout the country.

The complaint was filed by Universo Online, Latin America's largest Internet service provider, with more than 760,000 subscribers in Brazil, Mexico, Chile, Venezuela, Argentina and Columbia. AOL claims to have passed the 250,000-subscriber mark in the region.

UOL took umbrage to AOL's advertising claim, saying the numbers clearly show the Latin America ISP with the most subscribers. Its numbers concur with the Instituto Verificador de Circulacao, Brazil's first independent Internet site auditor. According to the IVC, UOL has held the number one spot for the past three months with 4 billion page views, 10.4 million unique visitors and seven million registered users.

The advertising body agreed, announcing "AOL has not presented enough reasons to entitle it to use such a slogan in Brasil."

AOL representatives were not available for comment on the ruling.

Jessica Chatham, American Advertising Federation public affairs assistant, said that while AOL is an AAF member, the organization would defer all comments about the ruling to the ISP.

This is the second Brazilian setback for the world's largest Internet service provider.

Last year, before launching regional portal AOL Brazil, it sued Brazilian ISP America Online Telecommunications for trademark infringement and domain rights to aol.com.br. The courts ruled in favor of the local ISP, maintaining it had filed for the domain first and was an established company before AOL decided to venture into Latin America.

The repeated setbacks are not good news for AOL and in particular its fledgling spinoff, America Online-Latin America.

The new company is in the midst of its initial public offering, with about $200 million raised in August. This is dramatically lower than AOLA's expectations to raise $425 million, and the ruling doesn't help its cause.

Brazil is considered the linchpin to Internet operations in the region with 41 percent of Latin America's Internet users, according to the IDC, and largest established land-based network. The IDC predicts more than 30 million Latin American Internet users by the end of 2003.