Chapter 378 (1/2)
It may be that westero is no longer in close contact with Reynolds nabesk group, and the Hurst family did not reply to Simon's offer until October 3.
William Hurst III did not intend to share the news resources of the San Francisco Chronicle, but said that Hurst group's Los Angeles Herald on the west coast could have a full range of content cooperation with igritte.
The Los Angeles Herald sounds like a serious newspaper, but it's actually similar to News Corp.'s New York Post, which focuses on social news and entertainment gossip.
Igrit portal is a comprehensive information platform in the news aspect. At present, it is mainly for the elite of the rich middle class, so it pursues the professionalism and seriousness of the news content.
Although there will be entertainment news, Simon doesn't have any idea of turning igritte portal into entertainment gossip portal.
Most importantly, William Hurst III took out the Los Angeles herald to cooperate with igritte. The fundamental reason is to ”renew the life” of the newspaper, because the Hurst group had planned to shut down the newspaper, which had been underperforming for many years in a row. Now, if it can get financial support through its cooperation with igritte, the newspaper can undoubtedly continue To survive.
It can be said that Hurst III had no sincerity at all.
Simon then took a step back and told Hurst III through Leibold that igritte portal only needs to obtain the content sharing of the domestic news section of the San Francisco Chronicle, and other international news, local news, entertainment news and sports news, etc. igritte does not need to.
The result is still rejected.
On the other hand, after more than a month of negotiation, AOL finally reached that exclusive agreement with three regional telecom operators, Bell Atlantic, bell Pacific and Nynex.
The negotiation of the agreement has gone through ups and downs. During this period, it once fell into a deadlock on the buyout offer of $1.50 for a single user.
The three operators united to insist that AOL must provide each user of the three networks with an exclusive fee of $1.50, which is 50% more than the $1 offer expected by the AOL team.
When the three operators thought that they had completely grasped AOL and the westero company behind the company, Steve Case broke the situation unexpectedly with a differentiation strategy, claiming that if the three operators insisted on the US $1.50 buyout offer, AOL could not support the cost, and could only choose two of the three companies.
As long as you open up your own line network, with the size of AOL at this time, you can get a total of tens of millions of US dollars without any cost. In addition, with the development of AOL a few years later, the agreement price can be renegotiated. In fact, the three operators are not so indifferent to this business.
After the split in 1984, bell system could not be united again. After confirming that Steve case was not threatening, the three companies finally made a concession.
Therefore, the final transaction price was confirmed as $1.30.
Bell Pacific, Bell Atlantic and Nynex, including two parts of home users and commercial users, have a total user size of 23.61 million, and initially need to pay a total exclusive fee of 30.69 million per year.
In addition, the duration of the exclusive agreement is 10 years, which is only half of the original expected duration of the contract. The parties to the agreement renegotiate the exclusive fee price every two years, and the increase in each quotation shall not exceed 50%.
After the signing of the agreement, AOL will be able to directly use the line networks of the three operators to carry out its own internet access services. However, the three operators will not provide additional equipment and technical support for AOL beyond the existing line network. If AOL has related needs, it will also need to pay a separate fee.
Although the terms on the surface of the contract are very biased towards the three operators, as long as the exclusive agreement can be signed, it is a victory for Simon.
The number of users of AOL has been growing rapidly in recent months. However, the three operators are still not aware of the huge potential of the Internet industry.
This kind of thing is totally unimaginable for Simon, a latecomer. However, just as HP didn't realize the importance of the personal computer invented by one of its employees, Steve Wozniak, then Xerox, the printer giant, made the same mistake. The first computer graphical interface operating system developed by HP only changed After a ”very convenient” comment from the president of the company, he was copied to two companies, one called Apple and the other Microsoft.
At the end of the day, no one in the world can see the future so clearly except Simon.
According to the user scale of the three operators at this time, even the price increase of five renegotiations reached 50%, and AOL finally paid less than $200 million in exclusive fees every year. But if we eat all of these 20 million users, AOL can only rely on Internet access services to earn billions of dollars in revenue every year.
What's more, within 10 years, as long as the regulation of the U.S. telecommunications industry can be reopened as it was in the original time and space, Simon has enough confidence to let AOL, which is now in a vine state, swallow the big trees it is now attached to.Simon has been discussing with the company's team in recent days a takeover plan for the two companies.
Because there is no need to rush, I still live with Janet at the Greenwich manor every day.
In the twinkling of an eye, it was Friday, October 5th.
As soon as Simon arrived at westrow headquarters in Manhattan in the morning, James Leibold took a copy of the newspaper and followed him to the office, saying, ”Simon, take a look at this.”
Simon sat down behind his desk and took the copy of the newspaper. He just glanced at the headline and frowned.
On the copy is an article called ”Beware of emerging Internet telecommunications may fall into a monopoly pattern”. The target of the review happens to be the exclusive agreement that AOL has just signed with the three major operators.
As for the content, just look at the title.
But that's not the most important. The point is that this article is from the San Francisco Chronicle.
After scanning the article, Simon shook his head and said, ”the hursts don't want to pay any price.”
AOL is just a company with less than 500000 users. Let alone at-t, even any of the seven little bels is absolutely a giant in front of AOL at this time.
Moreover, similar exclusive agreements are not created by AOL. Many companies operating Telecom peripheral services will sign exclusive agreements with these giants in order to maintain their market advantages. Internet access services, now also belong to the telecommunications industry.
However, the San Francisco Chronicle directly branded AOL as a monopoly.
The influence of the at-t Split case in that year has not completely dissipated. Telecom monopoly is still a sensitive topic, and most enterprises do not want to touch such a moldy head.
So the purpose of the Hurst family is obvious.
Perhaps he noticed Simon's active evasion in the acquisition of ESPN shares and refused the cooperation between the two sides in the content sharing of the San Francisco Chronicle. Now, William Hurst III probably lost patience and gave Simon a clear warning to ask him to take the initiative to quit.
James also had a wry smile on his face and asked, ”what are we going to do now?”
Simon left the copy of the paper on the desk in front of him and said, ”call Reynolds nabesk and we'll exit.”
James was a bit surprised: ”fight now?”
Simon nodded and said in a flat voice, ”fight. There's no need to delay. Since the hursts don't want to cooperate with us at all, that's all.”