AOL to Sell Off AOL France

AOL continued its strategy of separating its Internet access and content businesses in Europe, with the sale of its France Internet access business to Neuf Cegetel. 

The deal, announced Thursday, is worth €288 million (US$366 million) and includes an ongoing partnership between AOL and Neuf Cegetel, a broadband operator.

It’s the second such deal in a week. On Sunday, Telecom Italia bought AOL’s German Internet access business for €675 million.

The AOL France acquisition includes 500,000 broadband customers as well as AOL France’s customer service operation.

In addition, starting next year, AOL will manage online advertising sales and supply editorial content for all of Neuf Cegetel’s portals. The companies will share advertising revenue from the sites.

AOL will continue to support its own portal located here.

By the end of this year, Neuf Cegetel hopes to begin offering additional services to the acquired AOL subscribers, such as DSL (digital subscriber line) TV, mobile telephony and a converged GSM-Wi-Fi offering. Neuf Cegetel will also encourage AOL’s dial-up customers to migrate to broadband.

AOL France said in August that it was in negotiations with Neuf Cegetel. The confirmation came around the same time that AOL announced that it would begin offering its content services for free to any visitor to its portals around the world. Previously, the content and services were available only to AOL subscribers.

Earlier in the year, Telecom Italia made an offer for AOL’s businesses in Germany and France. The German business acquired by the operator earlier this week had 1.1 million broadband customers as of June, and 1.3 million dial-up subscribers.

AOL is still looking for a buyer for its remaining European Internet access business, in the U.K.

The change in strategy, whereby AOL will focus on primarily earning revenue from online advertising, came as the company struggled to retain Internet access customers. AOL will retain its Internet access business in the U.S. but pay less attention to subscriber growth there.

-Nancy Gohring, IDG News Service (Dublin Bureau)

Related Link:

• AOL to Sell German ISP to Telecom Italia for $853M

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