In an effort to attract new customers to CompuServe, and keep existing ones, parent company America Online today unveiled a revamped version of the venerable, but ailing, online service.
As before, CompuServe will remain geared for business and professional users. It offers access to databases such as patent and trademarks, company profiles and securities information.
But the new version, dubbed CompuServe Version 4.0, uses more of the look and feel of the Web. Unlike previous versions, which were built on proprietary technologies, the new CompuServe is built with HTML. A new main menu gives access to 20 channels organized by topic, and the package includes a search engine powered by Excite (XCIT).
AOL (AOL), which bought CompuServe in September 1997, will continue to market the brand separately to professionals, as part of its strategy to reach all kinds of online users. AOL's main service is aimed at home users.
The focused approach could help shore up CompuServe's business, analysts said.
"In the past CompuServe's parent companies had no idea what to do with it," said Henry Blodgett, analyst at CIBC Oppenheimer. "The new managment is focused on CompuServe as a particular brand with a particluar market -- serious users who want information without all the fluff you find on AOL."
CompuServe is one of the oldest -- and once the biggest -- online service. Before the popularity of the Internet and the Web, it was the main online hangout for techies and professional users. But it has suffered a steep decline in customers in recent years, partly because of management missteps and a lackluster marketing strategy.
Today's rollout is the first major upgrade of CompuServe's software since October 1995. It is not the first time the firm has tried to stop its market slide by offering new services.
In 1996, when CompuServe was an autonomous unit of H&R Block, it introduced Wow, its consumer-oriented answer to AOL. After six months of heavy losses, though, it scrapped the project.
Since acquiring CompuServe last year, AOL has moved quickly to turn around the faltering service. It first installed new management and fired half of CompuServe's staff. In March, CompuServe used AOL's marketing resources to create a new national advertising campaign.
The revamped CompuServe software also reduces costs, because HTML is easier to maintain than the company's previous proprietary system.
"The goal is to make it as cheap as possible to run the service," said Mark Usem, an analyst with Salomon Smith Barney. "AOL wants to make CompuServe profitable. That's the bottom line."
