2) What are the main obstacles to international expansion in this business? Is the service mobile, with competitive advantages (FSAs and CSAs) intact?
America Online is one of the largest providers of online services in the world. Beginning in the United States as Quantum Computer Services in 1985, America Online has grown substantially in the United States and internationally. In the early stages of America Online, before it was even named America Online, the company only had a mere 100,000 members. By 1994, America Online had reached the million-member mark; by 1995, America Online became the largest provider of online services and began to put their foot in the international market door.
The dream of entering international markets proved to be very difficult for the New Market Operations unit in AOL international. Originally, all of the services America Online provided were geared towards the American market. Changing their services to fit the new international markets was a very difficult task. America Online began making agreements with other companies to help make the process run smoother. America Online partnered with HP to make AOL the default setting on HP computers shipped in the United States and many other countries. America Online also signed an agreement with China Internet Corporation (CIC) to allow them to market, promote, and distribute AOL services to Hong Kong. This was a big start for America Online because if Hong Kong is successful then it could possibly give them access to the rest of China. Even though no other company offered the same services as America Online, the level of competition in the international markets was huge. America Online had to compete with other Internet providers, telephone and cable companies, and also the local papers, radio and television stations. The constant increase in new technology continued to bring more competitors into the market. Once America Online had made the leap into international markets...
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