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WorldCom Buys CompuServe, Customers Go to AOL

H&R Block has agreed to sell its 80 percent share in CompuServe to telecommunications giant WorldCom in a stock swap worth roughly $1.2 billion. In a separate deal, WorldCom will trade CompuServe's consumer customers and $175 million to America Online for AOL's ANS Communications network services division. That dollar amount is about five times the $35 million AOL paid for ANS several years ago, noted in MailBITS (TidBITS 254, 28-Nov-94). In essence, AOL takes over CompuServe's 2.6 million customers (AOL reportedly plans to keep the CompuServe name alive), and WorldCom adds both CompuServe's and ANS's networks to its existing UUNET network, creating a massive network of more than 500,000 dialup ports. AOL also signed a five-year deal making WorldCom AOL's largest network service provider in exchange for discounts worth several hundred million dollars. An acquisition of CompuServe was inevitable and these deals appear to give each company what it wants. The effect on CompuServe customers remains to be seen.

 

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