In the years before the emergence of the Internet, three online service providers battled in the United States for market supremacy. America Online (later AOL), Prodigy, and Compuserve each adopted “walled garden” strategies that pinned their hopes on exclusive content to attract large subscriber bases.
AOL ultimately won, becoming the largest online service provider in the world in the late 1990s. With tens of millions of subscribers, the company continued to bet on its walled garden approach, even as many people merely wanted their services to access the Internet. Over the years, AOL saw its market share shrink dramatically, overtaken by an open Internet that offers infinitely more choice than any single company can.
While others attempted to erect their own walled gardens – Minitel in France, early Internet access on wireless devices that only pointed to company-approved sites and services – consumer demand for open Internet access consistently won out.
Despite the poor track record, my weekly technology law column (Toronto Star version, homepage version) notes that walled gardens seemingly still hold appeal to companies that believe the best way to distinguish their services is to offer exclusive access to content. In recent months, Canada has experienced perhaps the last stab at a walled garden strategy with Shaw Communications’ purchase of Canwest Global Communications and BCE’s acquisition of CTV. Throw in the broadcast assets owned by Rogers Communications and Videotron and control of the major Canadian private broadcasters is solidly in the hands of telecom and cable companies.
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