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CompuServe rejects Europe Online

Embattled European ISP Europe Online has to look around for another financial savior.

Embattled Internet service provider Europe Online is still waiting for its white knight. Today, CompuServe ended talks with the troubled online service provider without reaching an agreement to invest in the company.

Earlier this week, CompuServe confirmed that it was negotiating an investment in the company as a way to speed its entry into the Internet access service market in Europe. Europe Online has 70,000 subscribers in Germany, France, and the United Kingdom.

But talks ended today because "terms could not be reached," according to a company representative quoted by the Bloomberg news service.

That leaves Deutsche Telekom, the German telecom giant, as Europe Online's best hope for a quick cash infusion. But analysts have questioned whether a Deutsche Telekom's bid would pose a conflict of interest, since the company has a standing agreement with America Online and a joint venture between AOL and Bertelsmann AG, both competitors to Europe Online.

CompuServe officials said they are continuing to look for a way to expand internationally.

Related story:
CompuServe may go continental