AT&T abruptly shut down its test of HealthSite, an ambitious health and fitness Web site, just a month before launch, leaving major content providers including Rodale Press scrambling to find a new online home.
Rodale, which signed an exclusive contract with AT&T Personal Online Services to provide material from Prevention and Men's Health to the site, was left in the lurch when AT&T pulled the plug on the test on Aug. 9. AT&T said vertical content areas such as HealthSite (http://www.atthealthsite.com) didn't fit with its growing focus on local services.
"What we learned in the scheme of things is that local [content] is much more integral to the core of AT&T," said Caroline Vanderlip, president of AT&T Personal Online Services. AT&T will now focus on developing the Hometown Network, a series of community-themed Web sites.
Other content development initiatives will likely be tabled or reappear in much smaller scale as part of Hometown.
For AT&T, the change in plans is the latest in a string of reversals as the company tries to figure out if it's in the content, network or access business. In recent weeks AT&T has sold off Imagination Network and sold AT&T New Media Services. For Rodale, the experience was a lesson in defensive Web strategy.
"We've known about their changing strategy ever since they started talking about looking for other investors," said Susan Russo, general manager of Rodale Health Online.
Visitors to the HealthSite are referred to sites for the magazines as well as sites for IVI Publishing and MediLife, AT&T's two other partners in the project.
AT&T's goal was to spin off the site to investors, but it was unable to come to agreement with any.