Information Technology Reference
In-Depth Information
IBM PC that made it a key element of everything that would happen for the next 15 years.
Companies that tried to fight the PC standard often had good reasons for doing so but they
failed because the phenomena overcame any weaknesses that resisters identified."
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The online world of PC users had up to now been restricted to a few proprietary sub-
scription digital environments such as CompuServe and Prodigy.
Compu-Serv Network, Inc. was launched in 1969; and its inspiration was serendipitous.
An Ohio-based insurance company (Golden United Life Insurance) found itself in a posi-
tion where, in order to completely serve its computing needs, it had to buy a DEC machine
of oversized capacity. Executives, in turn, decided to lease out the machine's excess.
For nine years - in a model resembling today's cloud computing paradigm - customers
were strictly corporate. But as of 1978 the firm began to market to the small but growing
population of small computer owners. 3,600 users had enrolled in the service by 1980.
That same year, the firm - now "CompuServe" - began making newspaper content
available online. AP President and General Manager Keith Fuller is quoted as saying:
"Since the newspapers began providing their electronic editions to CompuServe, Com-
puServe has grown from 3,600 subscribers in mid-1980 to more than 10,000 in the first
quarter of 1981." But in fact newspaper readers accounted for only 5% of CompuServe's
usage.
Growth became exponential. By early 1984, CompuServe boasted more than 60,000
subscribers. These subscribers paid an access fee of 13 cents per minute during the day and
10 cents a minute at night. They spent their time in topic-specific chat rooms, exchanged
e-mail, read online content, and eventually shopped in the stores of a "CompuServe Mall."
Most of the service's users were computer nerds, and most of the service's topic forums
were technical in nature.
The fastest modems? 300 bps. At least at first. The interface? Entirely text and menu
driven. At least at first.
During 1986, the tax return preparation firm H&R Block purchased CompuServe for
$23 million: a very wise investment. CompuServe grew faster than any other Block divi-
sion. By the end of the fiscal year which closed at the end of April 1989, CompuServe was
contributing $68 million to Block's sales (approx. 15% of total revenues) and almost $8
million in operating profits.
In that same year, CompuServe's only relevant competitor was The Source, a consumer
online service based in McLean, Virginia. Block bought The Source in June of 1989, ported
its 53,000 subscribers to CompuServe, and shut down the Source service on August 1.
Eventually, CompuServe was expanded into Europe and beyond. By 1993, 90,000 of its
