More expansion on AOL.com

While AOL has remained officially mum on the news of its Web site, one need only click over there to see what's going on: AOL is beefing up its already popular site to include channels, Web-based email, and other bells and whistles. Ultimately, expect a major push to bring people to AOL.com, where the company will be able to expand its strategy of making money from advertising and transactions onto the Web.

Today, for instance, when AOL announced one of its multimillion-dollar marketing deals--the kind that is becoming almost commonplace for the online giant--it prominently mentioned that the deal included not only its 10-million member online service, but also its Web site.

According to the deal, Internet Liquidators will pay AOL $10 million over two years in exchange for AOL marketing Internet Liquidator's online auctions on both its service and its Web page.

Previously, AOL has cut multimillion-dollar deals to distribute products on its online service. But if there was any mention of its Web site, it was incidental.

The thinking will be, if AOL can draw 10 million people to its service, the numbers could only grow if it brings those same services onto the Web, which is open to anyone with Internet access. Other companies, such as Microsoft Network, are trying the same strategy. But no one else has AOL's advantage of being the top company.

"We are waiting for AOL.com to become a very large, very significant site," said Kate Delhagen, an analyst with Forrester Research. "They have tremendous opportunity by creating AOL.com as a gigantic Web site that would potentially dwarf Yahoo if they did it right. They reach a worldwide audience overnight, which is something they can't do from AOL Network."

AOL, in today's release, claims that AOL.com is the most popular site on the Net. Others probably disagree about its exact ranking, but it would stand to reason that the site is high on the list. Besides having top name recognition in the industry, AOL also makes AOL.com the default Web page on its online browser.

That means every time an AOL member goes to the Web, he starts on AOL.com (unless he changes his default home page).

Delhagen added that as AOL quietly slips out of the access business over the next few years--it has already shed its business division and is outsourcing its connectivity business--it will need to rely fully on revenues from advertising and transactions.

"There's extreme economic incentive," she said. "They are truly headed to become a media company."

And that's the language AOL understands well.