An Accidental Giant
In 1985, General Electric’s Information Services (GEIS) division launched the General Electric Network for Information Exchange, or GEnie. It was a clever idea from founder Bill Louden, a former CompuServe product manager. The plan was simple: GE had
massive mainframe computers that crunched data for corporate clients during the day but sat mostly idle at night. GEnie let paying hobbyists dial-in during these non-prime hours for a remarkably low price, making it an instant and serious competitor to the dominant force of the time, CompuServe. The service offered email, forums called RoundTables, and groundbreaking multiplayer games, quickly growing a loyal user base that reached 350,000 users by 1994. For a moment, GEnie was the second-largest online service in the world.
The Corporate Glass Ceiling
Herein lies the hidden decision. GEnie’s very origin—as a way to monetize idle computer time—became its curse. To the executives at General Electric, including the notoriously bottom-line-focused CEO Jack Welch, GEnie was never a primary business. It was seen as “fill-in” load for the mainframes, a side hustle for a massive industrial conglomerate. As GEnie’s popularity exploded, users clamored for more access, but GEIS executives steadfastly refused to invest. They wouldn't expand the network or add mainframe capacity specifically for GEnie. The service was a cash cow that the parent company refused to feed. This wasn't one single choice made in a boardroom, but a persistent, strategic decision to starve a promising venture of the resources it needed to truly scale.
While GEnie Slept, AOL Attacked
This corporate ambivalence created the opening for a scrappy, aggressive upstart: America Online. While GEnie was text-based and tied to GE’s limited infrastructure, AOL was building a friendlier, graphical experience for the masses. More importantly, AOL pursued a radically different business strategy. It carpet-bombed the country with millions of free trial floppy disks and CDs, correctly betting that ease of access and a simple flat-rate monthly fee would trump GEnie’s and CompuServe’s complicated hourly charges. By the mid-90s, AOL was signing up a new subscriber every six seconds, while GEnie’s growth had flatlined. GE had a massive head start in the online world but failed to invest in marketing, user interface, or infrastructure, allowing AOL to completely redefine the market.
A Whimper, Not a Bang
The end came slowly, then all at once. By the mid-90s, GEnie was a ghost, haunted by its text-only interface in an increasingly graphical world. In 1996, GE finally gave up, selling the service to an investment firm. The new owners, lacking GE's deep pockets, made a fatal error: with just 12 hours' notice, they announced a massive price hike and the elimination of flat-rate services. The user base, already dwindling, collapsed almost overnight. After a few more years of obscurity and failed attempts to pivot to an internet service provider, the lights on GEnie were turned off for good at the end of 1999, a casualty of Y2K compliance concerns.
