AOL's New Beta is 'Fat' with Graphics

America Online has released version 8.0 of its email client to beta testers, and the buzz is that it’s a significant improvement featuring more personalization, more rich media and more room for ad units.

Beyond the radically changed design, the new client represents AOL’s attempt to incorporate rich media — part of the ISP’s quest to deliver broadband-style graphics and audio to its mostly narrowband base of 34 million subscribers.

The new version arrives amid countless expectations over how the unit will improve its ad revenues amid slowing subscriber numbers. The client features more “real estate” that could help the ISP expand its ad and marketing inventory.

But perhaps more important, it leverages the latest in compression technology in order to feature rich media units, notably “takeover ads” or “click magnets” that often float, scamper or otherwise animate their way across a user’s desktop and are usually associated with fast Internet connections.

Gone are the primary colors of the prior AOL client — including the gray background. The new version features deeper colors on the backdrop, which can also be used to display marketing themes, as well as a range of personalized design themes (known as “skins”) which the user chooses.

The new features clearly move the software beyond the standard banners and buttons that have long characterized AOL’s look. Some of this innovation comes as a result of the company’s partnership with, and investment in, Viewpoint, a New York-based company that works with rich, interactive 3D graphics. That relationship began in v.7.0, but has been expanded in this latest build.

The new beta arrives at a critical time for the ISP as it searches for its footing following a turbulent few weeks, which saw the departure of interim AOL chief executive Robert Pittman, who also resigned as COO of the corporate parent two weeks ago.

Last week, the company revealed a routine Securities and Exchange Commission Investigation into how AOL booked online ad deals during the period when the dot-com bubble was evaporating, which caused even more selling among investors (who later returned to buy back shares). A 42 percent decline in ad and commerce revenue for the unit during the second quarter, combined with a sluggish — at best — ad outlook for the rest of the year also led some analysts to lower their ratings on the company.

In many ways, the new AOL version is a return to its roots and also represents a return to “fat client” applications — software that resides on and is updated on a user’s desktop instead of being called up from a Web application server, contrary to the trend of the past seven years.

One reason fat client applications such as v.8.0 are returning, experts add, is they represent a more scalable way to achieve compression with slower dial-up Internet connections. The technology enables larger files, say audio and big graphic files, to be disassembled from packets before transit and then reassembled on the user’s desktop. The concept is similar to load balancing techniques that electric utilities deploy when spreading around their electricity during peak demand.

In that way, the beta, which allows more graphics and richer content to feed into the user’s desktop, also represents something of a return to AOL’s early days, when the mantra was “content is king.”

People familiar with the design say the replacement of AOL’s prior chief Barry Schuler last year helped clear the way for executives with a strong background in graphics and compression technology to take the reins of the new design.

And even as AOL searches for a new chief executive to fill Pittman’s temporary spot, there is no mistaking the influence of his management team in the current beta.

Pittman’s mantra was cross-platform synergy and the beta version makes way for more promotion from other media units within the AOL Time Warner empire. For example, when AOL’s film divison cousin is close to releasing its next “Harry Potter” movie, the AOL background and “floating” channel navigation bar might feature animated characters from the movie peeking out from behind the navigation modules that appear to “float” on a user’s desktop.

“I was pleasantly surprised by this build,” one early tester posted on a message board about the beta. “This is in stark contrast to their AOL Companion App’ built with Flash, which the beta testers seem to absolutely HATE,” posted another tester. So far, many of the beta comments have been positive.

AOL’s arch rival, Microsoft, is also currently in beta with MSN 8.0, its next email/Web portal/ISP service that includes new email management tools, advanced junk mail filtering and several userface tweaks.

Given the work that AOL had spent on a new layout engine built in its own Netscape browser division, observers were waiting to see if the beta included any surprises, such as a different default browser. There were no changes, however. The latest AOL client features Microsoft’s Internet Explorer as its default browser, as the company had previously stated.