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There’s nothing lower than being trusted less than Microsoft..

Moreover their stature as a huge conglomerate inspires (probably justifiable) fears that they might misuse their knowledge of customers in manipulative marketing..

Further down the road, I’ll bet that AOL’s extremely poor growth management during the 1996-1998 period, which resulted in customers more often than not getting busy signals when trying to connect, may be biting them in the ass.

-Ian.

—— http://dailynews.yahoo.com/h/nm/20010823/tc/media_trust_dc_2.html

Thursday August 23 5:02 PM ET

Consumers Distrust AOL More Than Microsoft-Gartner

NEW YORK (Reuters) – Consumers are more distrustful of AOL Time Warner Inc. (NYSE:AOL – news) than rival Microsoft Corp. (Nasdaq:MSFT – news), which has been the target of competitive concerns for years, according to a Gartner Inc. survey of adult online users released on Thursday.

AOL, which prides itself on consumer privacy and security issues, is the least trusted company on the Web when compared with online services from banks, brokerages, credit card companies, online retailer Amazon.com Inc. (Nasdaq:AMZN – news), large retailers and Microsoft, the survey found.

About 37 percent of online consumers said they had a high level of distrust of AOL Time Warner’s AOL Internet unit, compared with 29 percent who said they were highly distrustful of Microsoft. About 21 percent were distrustful of banks and thrifts as part of the survey.

The survey also found that 17 percent of the consumers said they had high levels of trust in Microsoft while 15 percent said the same about AOL. Meanwhile, 33 percent had high levels of trust in banks and thrifts.

Those surveyed were answering a question about how much they trusted online providers with their personal and financial information.

Gartner Research Director Avivah Litan said in a phone interview that the report was done by surveying 2,150 consumers in hopes of gauging attitudes toward using the Internet for shopping and other transactions. The research was not vendor-sponsored, she added.

The survey also hoped to find what features needed to be in place to ease concerns and who consumers trust most to deal with personal and financial information.

“It directly contradicts everything we are hearing from our members,” said AOL spokesman Andrew Weinstein. “Consumers have a wide choice in online service and we added more than six million members in the last year alone. We survey our members all the time and satisfaction has never been higher”

Since the closing of AOL’s $106.2 billion purchase of Time Warner Inc. in January, the Internet and media giant has experienced some of the backlash that software giant Microsoft has endured because of its size, reach and power.

The findings come amid Microsoft’s aggressive battle to take away market share from the world’s largest Internet services provider and as Microsoft tries to bulk up its Internet presence and services.

“The added trust that consumers have in Microsoft gives the company an important leg up in its battle with AOL for online services. Consumers will be more likely to try new Microsoft features embedded in Windows XP, such as Microsoft Messaging,” said Litan. “AOL has always viewed itself as the ‘consumer’s advocate’ but this survey clearly dispels that myth.”

Microsoft also received higher consumer satisfaction ratings than AOL on its Internet and e-mail services, the survey found.

THOUGHTS ON PASSPORT

Gartner also asked consumers about Microsoft’s Passport service, which lets consumers sign on to Web sites and services with just one user ID and password and which has raised the ire of some privacy advocates.

Out of those who did use Passport services, Litan said about 83 percent did not feel comfortable enough providing their credit card numbers.

More than 70 percent of those surveyed had not signed up for the Passport service and said they were highly unlikely to do so in the next six months.

Shares of AOL Time Warner closed up 58 cents at $40.08 and shares of Microsoft closed down $1.54 at $59.12.

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