AOL Internet Device Targets Households

by Neil Irwin

Saturday, November 11, 2000

Inc. yesterday unveiled the first in a series of devices it hopes will make the company's online services ubiquitous in American homes.

Along with computer maker Gateway Inc., Dulles-based AOL introduced the Gateway Connected Touch Pad, a small device with a touch screen, customized "Instant AOL" software and a plug for connecting to the Internet through household phone wires or broadband connection. The companies envision families keeping the Touch Pad in their kitchen or family room and using it to track schedules, send e-mail, exchange notes or check TV listings.

"What we're hearing is that families don't really need all the complexity of a full-fledged Windows computer. They just want to get online. What makes this device compelling is it's very sleek, is small and quiet," said Barry Schuler, president of AOL Interactive Services, in an interview.

It may be sleek, small and quiet, said some analysts, but with a price of $599 plus AOL subscription fees, it may be too expensive for the consumers that the companies hope to reach.

"It's a tough price," said Gary Arlen, president of Bethesda research firm Arlen Communications. "Especially in an era when every Best Buy ad offers you a full-fledged computer at that price."

Jointly developed by AOL and San Diego-based Gateway, the Touch Pad can be ordered online, by phone and in Gateway stores starting Dec. 1 and will be delivered to customers beginning Dec. 15.

Introduction of the device--and similar ones still under development--is part of AOL's plan to encourage household use of the Internet throughout the day without the laborious process of booting up a PC and logging on to various Web sites. It is an element of the company's "AOL Anywhere" strategy of making its products readily accessible from a wide range of devices.

The Touch Pad has a 10-inch flat screen that can be mounted under a cabinet or stand alone and comes with a wireless keyboard.

Several companies have introduced Internet access devices other than PCs in recent years, with minimal success. But the field is heating up, with products from Compaq Computer Corp. and 3Com Corp. having appeared on the market in recent months.

Schuler said he is confident that the AOL-Gateway offering will surpass those competitors.

"The first and foremost difference is it's AOL," he said.

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