AOL grew out of a failed scheme to download Atari games by phone
In 1983 a startup called Control Video sold Atari 2600 owners a 49.95 dollar modem so they could rent games over the phone line for a dollar each. The company nearly went bankrupt. Its leftovers became America Online, which at its peak bought Time Warner in the biggest merger in American history.
William von Meister founded Control Video after Warner Communications turned down his idea for music on demand. GameLine let players download a game temporarily and track high scores. Steve Case joined as a marketing consultant in January 1983 on his brother's advice, and Jim Kimsey came aboard that May to help a firm edging toward collapse. Von Meister left in early 1985, and in May Kimsey rebuilt the remains as Quantum Computer Services, launching Quantum Link for Commodore 64 and 128 owners that November using software licensed from PlayNet.
The name America Online arrived in 1989, and Case took over as chief executive when Kimsey retired in 1991. Early experiments included LucasArts' graphical chat world Habitat from 1986, a homework help service called Teacher Pager in 1990, and relentless mailings urging modem owners to try the service free. When AOL opened Usenet to its members in September 1993, the flood of newcomers never let up, a moment remembered as the Eternal September.
Hourly billing ended in December 1996 with a flat 19.95 dollars a month, which swamped the network with busy signals; an August 1996 outage had already cut off over six million people for 19 hours. Even so, users reached 10 million within three years, and by 1997 roughly half of American homes online connected through AOL. It bought CompuServe in 1998, Netscape for 4.2 billion dollars in a deal closing in March 1999, and MapQuest for 1.1 billion.
The Time Warner merger, announced in January 2000 and completed in January 2001, gave AOL shareholders 55 per cent. Then dial-up faded. The full America Online name was dropped in April 2006, Time Warner spun it off in 2009, and Verizon bought it for 4.4 billion dollars in 2015, folding it together with Yahoo. Its newest owner, Bending Spoons, paid Apollo 1.5 billion dollars for it in January 2026.
Source: AOL
