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Study: AOL's got unhappy customers

Consumer satisfaction with America Online is extremely low compared with other Web portals and with almost every sector of American industry, according to a new study.

Consumer satisfaction with America Online is extremely low compared with other Web portals and with almost every sector of American industry, according to a new report.

The University of Michigan released on Monday its latest American Customer Satisfaction Index (ACSI), the results of a survey that follows various sectors of the economy each quarter. The second-quarter report focused on cars, household appliances, PCs and Web portals. For the first time, the survey also measured satisfaction with search engines and news and information Web sites.

America Online got a consumer satisfaction rating of 59 out of a possible 100, the lowest of all companies measured in the Web portal category. The top scorer was Yahoo with 76. MSN came in at 72. The average for the portal category was 68.

"Scores this low are rarely sustainable in competitive markets," University of Michigan professor Claes Fornell said in the report, regarding AOL. "Either there is improvement or the company is forced to leave the market--unless, of course, it has significant monopoly power. AOL consists, of course, of much more than portals, but the low ACSI score may be symptomatic of more widespread problems."

AOL said the study was not representative of its online service. "As stated clearly by the survey's authors, this was a study of portals and therefore has nothing do with the AOL online service," said Nicholas Graham, an AOL spokesman. "In fact, our own research, as well as recent independent analysis, shows that AOL member satisfaction and member loyalty has never been higher."

Google led the way among the search sites, achieving a satisfaction score of 80. Ask Jeeves came in second with a 62, while AltaVista scored 61. Fornell said that such a wide difference among competitors is rare and "usually limited to evolving industries."

Meanwhile, consumers are losing satisfaction with their PCs. The overall category got a satisfaction rating of 71, "substantially below" previous highs and also below the national index average of 73 for all industries.

Dell Computer, which has topped the category since 1999, saw its numbers drop. It fell from a score of 78 in 2001 to 76 this year. And the gap between Dell and the second-highest scorer is shrinking. Apple Computer came in at 73. Gateway had a 72. Hewlett-Packard scored a 71, and Compaq Computer had a 68. "Further erosion in customer service and satisfaction may adversely impact repeat business," Fornell said about Dell, noting that there is a nearly one-to-one relationship between customer satisfaction and customer loyalty.