Microsoft launches MSN 8, details ISP profit
Bill Gates joined Disney's Michael Eisner at the launch of MSN 8, declaring that "We understand that we aren't a media company," according to this News.com story:
During his introduction, Gates said that Microsoft was taking a different approach with MSN 8 than it took with earlier versions. Rather than making online content a priority, Microsoft focused on improving the online access client. This approach is important because the boundary between "what you do online and on the PC doesn't exist," Gates said.
...In a Wednesday interview, Yusuf Mehdi, the corporate vice president overseeing Microsoft's MSN division, estimated that ISPs like AOL and MSN take in about $10 profit per customer, before accounting for cost of acquisition and related costs.
MSN is betting big on broadband; AOL, however, loses profit every time one of its customers converts from dial-up to broadband, say analysts.
"If (they) move to broadband--(to) anyone but Time Warner--all that profit is gone," Mehdi said. "We're all in the same boat, that the move to broadband is a challenge."