America Online Targets D.C. Customers With a Local Service

by Kara Swisher

Tuesday, September 12, 1995

In its first move to offer regionalized information, America Online Inc. is building Digital City Washington, a new local service aimed specifically at its Washington area customers that it says number more than 200,000.

The service, scheduled for introduction later this month, is to include articles and reviews from Washingtonian magazine, news and weather from News Channel 8, local classified ads, chat groups, electronic shopping, maps and tourist information.

It also will allow users to connect to Washington-specific data maintained by other organizations, such as Georgetown University's "home page" on the Internet worldwide network of computers.

Analysts said that Digital City Washington could offer serious competition for The Washington Post Co.'s recently launched Digital Ink on-line service and other local on-line services that have sprung up here. With more than 3.5 million customers, America Online is the country's largest on-line company.

"We have been busy building out a nationwide membership and now we want to offer members living near major cities more local content," said Ted Leonsis, head of the America Online Services division. "In some of our key cities, we have hundreds of thousands of customers. That makes us like a local cable concern or a network with affiliates and we wanted to take advantage of that audience."

If the service is successful, America Online plans to offer similar ones aimed at other major metropolitan areas such as New York and Los Angeles. The D.C. area was chosen as first, said Leonsis, because of the proximity to America Online headquarters and its extremely high per-capita levels of computer users.

Currently, America Online's regional content is largely limited to on-line versions of newspapers that it offers subscribers, including the New York Times, Chicago Tribune, Orlando Sentinel and San Jose Mercury News.

Digital City Washington goes a step further by packaging together many types of information from a variety of sources. People who use it will pay the regular America Online rates for access to it.

Still in testing, the service is thin on information in many areas. The weather listing in the news area yesterday morning, for example, was still posted from last Friday and not updated until late in the afternoon. Entertainment and dining listings were also incomplete.

Leonsis said the offerings will improve with time and that the company will try to acquire or tap into as many local databases as possible in the future, with suggestions from customers.

Breadth of content is a major strength of The Washington Post's Digital Ink, said editor and publisher Don Brazeal. Brazeal declined to give subscriber figures for the service, which was launched six weeks ago. The service offers news and archival data from The Washington Post newspaper, electronic mail, discussion groups and features that Digital Ink employees generate themselves.

"The electronic world of publishing is obviously going to be quite competitive," said Brazeal. "But how this all plays out is unclear. A hundred years ago, for example, the city was pretty jampacked with newspapers and 100 years later there are far fewer alternatives."

Digital Ink's strategy is to build a relationship directly with subscribers, rather than reaching people as one part of a large, national service.

Washington has a community-oriented Internet service called CapAccess, hundreds of local "bulletin boards" on a wide variety of topics, and a plethora of Washington area sites on the Internet's graphically oriented World Wide Web. Which will survive is anyone's guess, said analysts, though most agree that those with the widest content and mass of customers will likely prevail.

"Local services have not done very well so far because there have not been a significant enough amount of users to justify them," said Peter Krasilovsky, a Bethesda-based on-line analyst. "But that was before there was this mass of people using on-line services . . . and America Online is certainly ahead from the start with its large D.C. area base."

CAPTION: America Online's Digital City Washington offers news. reviews, weather and more. If successful, AOL plans to offer similar on-line services aimed at other major cities.

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