AOL Looking to the Sky?

As America Online Inc.
expands its services in all directions, the only way left to go is up.

The company is reportedly considering a deal with satellite service DirecTV for high-speed Internet
connectivity via DirecTV’s satellite network. Although company officials at
both organizations refuse to comment on the possible deal, their actions
speak louder than their words.

In addition to the mega-merger between AOL and Netscape, the company has also
positioned itself to augment its connections to customers interested in
high-speed Internet access.

The company announced last week an agreement with Bell Atlantic to provide
high-speed digital subscriber line (DSL) access to AOL subscribers in the
Northeast. Bob Pittman, AOL’s president and chief operating officer, said
at the time that AOL has a commitment to provide access to members seeking
faster connection speeds.

A company initiative, known as “AOL Anywhere” is also being developed to
provide universal connectivity to any Web-based device, according to
spokeswoman Jeanie Ryan.

DSL and cable modems are currently the high-speed connections of choice,
but DirecTV is in a position to lend its satellite service as an
alternative to service providers, especially for those living outside cities.

A proposed deal with Microsoft to create a PC card capable of receiving
satellite Web data fell through, leaving DirecTV and its parent, Hughes Electronics with the technology,
but no partner.

Analysts say a deal with AOL and its 15 million members would be a match
made in heaven.

“This would be just standard programming logic,” said Steve Blum, president
of satellite consulting firm Tellus Venture Associates, in published
reports. “It’s a little like saying HBO is going to be offered over DirecTV.”

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