American Online Hires Head of GE Division

Move Called Blow to Rockville-Based GEnie

by Kara Swisher

Tuesday, March 28, 1995

America Online Inc. of Vienna, the nation's fastest-growing on-line service, has hired away the top executive at the Rockville-based GEnie to help run its burgeoning Internet business.

Industry analysts said the departure of GEnie president Mark Walsh is a blow to the General Electric Co. subsidiary. Walsh joined the company last year in what GE officials said was a bid to enliven the faltering consumer on-line service in the face of increasing challenges by bigger and better-marketed companies such as America Online.

America Online has more than tripled its membership over the last year to more than 2 million customers, said analysts, while GEnie has watched its business dwindle from about 250,000 users to just over 100,000. GEnie was founded in 1985 as an outgrowth of General Electric's corporate e-mail business.

Walsh -- a 40-year-old former television newscaster and cable TV executive -- was hired by General Electric last August. He's viewed in the industry as an innovator.

"Mark Walsh as a long history of working in all areas, from on-line to the consumer world to marketing, and he is also a charismatic leader," said David Cole, president of AOL's Internet division. "It's not so much a question of him leaving somewhere as much as coming to a company that is moving aggressively forward."

Walsh's departure from GEnie was sudden and surprised some of his colleagues there. He had planned a telephone news conference this week with analysts and reporters to discuss expected changes at GEnie, from improvements in its graphics to increased focus on popular and more lucrative niche areas such as games.

Walsh did not return telephone calls seeking comment yesterday. But in an interview in October, he boasted of remaking GEnie and "rewriting our history."

He now will help write the rules at AOL, where he will become a senior vice president and general manager for branded Internet services at AOL's Internet Services Co.

The division is developing a range of products and services to take advantage of the popularity of the worldwide network of computers.

New products include software to navigate the Internet's graphically based World Wide Web and more Internet services aimed at businesses rather than America Online's traditional consumer focus.

Analysts said the Walsh's departure from GEnie will hurt morale at the company, which already had been suffering, because Walsh was seen as someone with the energy and creativity to revitalize its business.

"GEnie has been struggling to define itself, and Mark's innovative management style was supposed to be part of that," said Peter Krasilovsky, senior analyst at Arlen Communications Inc., a new-media consulting company in Bethesda. "But these days probably being the fifth or sixth executive at a top company is much better than being the top dog at one heading down."

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