AOL: Broadband is three years off

Barry Schuler says the company will spend aggressively, but does not plan to buy its way into the cable modem business.

America Online will spend $10bn over the next ten years to help develop broadband content and technology, according to Barry Schuler, its president of interactive services.

"We believe a whole new infrastructure has to be built," Schuler told ZDNN. Schuler said AOL is already trying to help build up a broadband infrastructure through its deals with telecommunications providers like Bell Atlantic and SBC Communications. Joining the ranks of other ISPs like AT&T and buying a cable company to ensure cable modem access isn't currently in AOL's plans, Schuler said, in reference to rumours that it was looking to take a piece of Excite@Home.

"The cable guys are in turmoil over whether to resell their services or keep them proprietary. We believe they'll join the party," Schuler said. "If they don't, they'll be missing out on a lot of money."

Schuler believes the rise of broadband use will occur simultaneously with the increase in the number of multiple PC homes and home networking. He noted the need for people with multiple computers to have a single point of online access instead of installing multiple phone lines for modem use. "Broadband is still in its infancy," Schuler said. "I think it'll be another three years before it really ramps up."

Aside from issues associated with broadband, Schuler believes AOL faces three key issues; increased competition within the industry, an industry-wide talent shortage and increasingly difficult to adapt technology. "Everybody wants a piece of what we have," Schuler said. "We've been successful taking complex technology and making it easier, but with some of this new technology, like broadband, etc., it's getting harder to make it easier."