In the United States. videotex systems developed erratically as first newspaper publishers, then database operators, explored its technical and commercial potential. Early European videotex systems, such as the highly successful French Teletel service, became better established thanks to direct government support. Ultimately, the confluence of advancing personal computing technology, graphical user interface software, and the development of the World Wide Web portion of the Internet created a global standard for interactivity, displacing earlier videotex models.

     Great Britain is credited with developing the first videotex system. Created by the British Post Office, Viewdata. later renamed Prestel, was demonstrated in 1974 and launched commercially in 1979. It operated until 1994. Other nations such as Germany. Japan, Finland, and the Netherlands introduced videotex services in the early 1980s., but France was the most successful. France's Teletel, a simple text and graphics system commonly known as Minitel, was publicly demonstrated in 1980 and tested using 270,000 Minitel terminals. Equipped with a small screen and fold-down keyboard, the Minitel terminals were supplied free by state-owned France Telecom and installed in 2.5 million homes and offices by 1986. In addition to government support, another key to Minitel's national acceptance was the creation of a "trigger application" that would encourage repeat usage. Fast access to a national telephone directory provided this incentive, and consumer use of thousands of services, especially train schedules and reservations. dating services, and chat rooms grew rapidly.

     According to the Organization for Economic Cooperation and Development, by the end of 1990 there were 6.8 million videotex users outside the United States. Germany's Bildschirmtext had over 250,000 users, and  Great  Britain's  Prestel  had  160,000. France's  Minitel   was  the  leader, and   by   November 1994, 14 million people were accessing services from 26,000 providers. Minitel  use grew further  in  the  mid­ 1990s thanks to access-enabling modem cards for personal computers.  However,  Minitel  usage  declined with the growth of the more sophisticated Internet. In 2000 Minitel use in total minutes dropped 11 percent after declining 7 percent in 1999. Although  still  useful in noncomputer households. Minitel's  eventual  demise is generally accepted.

     The U.S. introduction of videotex dates to trials and commercial launches by newspaper publishers in the 1980s. Concerned with declining readership, publishers saw videotex as their electronic future and partnered with leading technology and telecommunication companies to offer text-and-graphics capable videotex systems. Their arrival was trumpeted by forecasts of extraordinary consumer market potential.

     Knight-Ridder and AT&T partnered to form Viewtron. launched a trial in 1980, and started commercial operation in October 1983. The Miami area service required a dedicated AT&T Sceptre terminal, which retailed for about $600. To attract more subscribers, Viewtron later experimented with terminal rental, reduced monthly fees, and personal computer compatibility. The system folded in March 1986 with losses estimated at $50 million.

     Gateway, a joint venture between Times Mirror and Infomart, a Canadian software firm, introduced its system in Orange County, California, in October 1984. Service was provided through decoder boxes attached to television sets. By mid-1985, the television-based service was discontinued, and personal computer owners were targeted. Nevertheless, Gateway closed in March 1986 after reportedly losing $30 million.

     The Chicago Sun-Times, Centel Communications, and Honeywell began operating KeyCom in Chicago in January 1985. KeyCom also targeted the growing personal computer market but attracted few paying customers and closed after just six months.

     The pioneering videotex services failed to realize commercial success for a number of reasons: system interfaces were complex; many followed a newspaper model, providing news and information already available less expensively in other media; some required the simultaneous use of the television and telephone by one person in the household, limiting the activities of others; and consumers felt the connect time and equipment charges were too high.

     During this time, interest in online, text-only database and bulletin board services was growing among computer hobbyists. In 1978 CompuServe, which began as a mainframe time-sharing service, started offering to PC users access to a bulletin board with connection time paid for in one-minute increments. By 1980 CompuServe had attracted several thousand subscribers, and The Columbus Dispatch became the first newspaper to offer an electronic edition on the service. Within two years, 11 U.S. newspapers were on CompuServe, which, by the end of 1983, had 63,000 subscribers. Other database services included Delphi, founded by General Videotex Corporation in 1982 as an online encyclopedia, and General Electric's Genie, which entered the market in October 1985 with stock purchasing and financial advice services.

     These database systems were joined by two text­ and-graphics services designed for personal computer owners. IBM, Sears, and CBS (which dropped out in 1986) formed Trintex, later renamed Prodigy, in 1984. Test marketing began in mid-1988 followed by a national rollout of the service in September 1990. Quantum Computer Services, founded in 1985 and later renamed America Online, Inc., launched its Applelink and PC-link videotex services in 1988.

     In the early 1990s, these online services worked to develop their user interfaces and create the most compelling package of content and services, pricing, and promotion. They all offered a bundle of proprietary content and services, including electronic mail, sports, weather, news from full-text magazines and newspapers, stock quotes, brokerage services, games, interest group forums and bulletin boards, and travel booking. Subscribers typically paid for a basic level of service plus surcharges for additional time and access to so­-called enhanced or professional services.

     By January 1991, IBM and Sears had spent approximately $650 million on Prodigy. A year later the service claimed 1.25 million subscribers, displacing CompuServe as the largest U.S. online service. But strategic missteps made Prodigy a lightning-rod for criticism. High electronic mail volume led Prodigy to levy a surcharge on heavy users. Subscribers were angered and thousands left the service. Prodigy also raised contentious First Amendment issues by censoring its online bulletin board postings for sexual content, going so far as to shut down its sexually explicit "frank discussion" forum.

     In 1992, as competition intensified, Prodigy and CompuServe revised their price and content packages to attract new members. To address consumer concerns of accumulating excessive charges, Prodigy introduced basic and enhanced service packages for flat monthly fees. CompuServe, relatively unknown outside the computer industry, rolled out new advertising intended to boost its brand awareness. Meanwhile, AOL's membership was increasing rapidly, and the service developed a Windows version that became available in January 1993.

     The mid-1990s was a time of extraordinarily rapid change for online services. Subscribership grew as consumers who bought computers sought to maximize their utility. Graphical interfaces were created to facilitate online service use. Mosaic, the first graphical browser for the World Wide Web, was released by the University of Illinois, soon to be followed by Netscape's first navigator.

     Prodigy defined online services for mainstream America with its 1993 national television advertising telling consumers "You gotta get this thing!" In April I 993, AOL revised its pricing plan to provide more hours for a set monthly fee, while, in July, Prodigy again angered its customer base by abandoning its just­ introduced flat rate pricing in favor of standard, monthly fee plus hourly use packages.

     Subscriber growth accelerated in 1994 with AOL, which reported 600,000 members in February reaching 1 million users by July. Prodigy reported over 2 million subscribers in May. Not to be left behind on the Internet front, AOL set to work on its own Web browser and Prodigy was offering Web browsing by the year's end.

     Chaos continued to reign in 1995 as the online services expanded their content, upgraded their interfaces, introduced audio and video content, and waged price wars. Overall subscribership increased 64 per­ cent, reaching 8.5 million users. A mass market was being created amidst the cutthroat competition.

     Aggressive marketing enabled AOL, whose proprietary content offered novices a well-outfitted first stop on the Web, to exceed 4 million subscribers at the close of 1995. CompuServe held second place with 3.9 million users, and Prodigy, the first family-oriented service, saw its growth stalled at 2 million subscribers. The Microsoft Network (MSN) debuted in the summer, quickly attracting 600,000 subscribers. Losers in the competition were industry also-rans Delphi and GEnie. 

     Looking for additional avenues of growth, the online services were exploring service delivery to Amer­ ica's televisions. WebTV Networks, Inc., founded in 1995, blazed the trail, but the service failed to gain a significant following. Microsoft purchased WebTV in August 1997, renaming it MSN TV in July 2001. With fewer than 1 million subscribers and no recent growth, MSN TV appears to be fading.

     In 1996 the online services were aligning with the World Wide Web to grow subscribership and revenues with updated Web-based content and electronic commerce. AOL and Prodigy enhanced their Internet access, but for Prodigy the effort came too late. Once the leading online service, by May Prodigy lost nearly half of its 2 million subscribers due to lagging technology, underdeveloped content, and difficulty of use. After investing over $1 billion, IBM and Sears sold the sen.ice to International Wireless. General Electric also sold GEnie after its user base declined from over 200,000 to 20,000.  

     AOL's tremendous growth overwhelmed its system, which crashed for almost the entire day on August 7, 1996, earning it the nickname "America Offline." Nevertheless, just weeks later, AOL acted to gain even more subscribers by adopting flat-rate pricing of $19.95 per month for unlimited access, breaking with the industry's traditional pricing model. Competitors had little choice but to follow suit.

     By the late 1990s, online services had evolved into Internet service providers (ISPs), aggregating content and serving as portals for exploring the Internet. AOL continued to experience service reliability problems and agreed to refunds for millions of its members. In early 1997, CompuServe and Prodigy created ads ridiculing those service lapses. Still, it was clear AOL's marketing strategies were working.

     By the turn of the century, there were over 4,500 ISPs in the United States. The online service business had matured with communications functions-e-mail, chat, instant messaging-and the Internet among its main attractions. Videotex had arrived. Telecommunications Reports International reported a third quarter 2001 total of 67.9 million U.S. subscribers to online services. AOL, which had acquired CompuServe and Netscape, remained the dominant player with over 25 million members, followed distantly by MSN, Prodigy, CompuServe, and others.

     The migration of dial-up ISP subscribers to higher capacity broadband cable and digital subscriber line (DSL) services is the industry's most recent trend. Of the available methods of Internet access, only cable modem and DSL are showing sizable growth. This will undoubtedly create more change in this dynamic medium.