When CompuServe Was the Internet

Before the World Wide Web existed, CompuServe was how most Americans first experienced online life. Forums, email, file downloads, real-time chat - all delivered over phone lines at 2400 baud. The lessons from those early days remain strikingly relevant.

As WOSU's retrospective documented, in September 1979, CompuServe launched its consumer service - 45 years before the current social media landscape. I was there, first as a user paying those outrageous hourly rates, then watching from inside the industry as I ran my own BBSs. By the mid-1980s, it had become the largest consumer information service in the world. At its peak in 1995, CompuServe had 3 million users worldwide. Then the web came, and within a few years, it was gone.

The First Online Service

CompuServe started in 1969 as a timesharing business for corporations in Columbus, Ohio. In 1979, they had excess mainframe capacity sitting idle at night and on weekends. Someone had the idea to sell that capacity to consumers.

The service they created was remarkable for its time. Users could access:

• Email. By 1989, you could send and receive email between CompuServe and the broader internet - years before most people had heard of the internet.
• Forums. Thousands of discussion areas covering everything from programming to needlepoint to NASA. These forums were the direct ancestors of Reddit, Hacker News, and Discord servers.
• CB Simulator. As Hackaday's technical history notes, real-time chat, written in a weekend by developer Alexander Trevor, became one of the most popular features. This was IRC before IRC, Slack before Slack.
• File libraries. Software downloads, documents, games - all organized and searchable.
• News, weather, stock quotes. Information that is now free on any smartphone cost money and required effort to access.

H&R Block bought CompuServe in 1980 and began aggressive advertising. For a generation of early technology adopters, CompuServe was the on-ramp to digital life.

The SysOp Model That Worked

CompuServe forums were not managed by employees. They were run by independent contractors called SysOps (system operators). They received compensation based on the success of their forums - traffic to boards, file downloads, chat activity.

This created something powerful: invested community leadership. SysOps had skin in the game. A healthy, active forum meant income. A toxic cesspool meant users leaving. The incentives aligned toward good community building.

I've watched this pattern repeat across different eras. The BBS culture I was part of worked the same way - I ran boards myself and learned firsthand what kept communities healthy. A person with a name and reputation ran each community. They made judgment calls. They knew their users.

Compare this to modern platform moderation. Content decisions are made by algorithms or overwhelmed contract workers reviewing decontextualized posts. CompuServe's model was more expensive per user, but it produced communities that actually functioned.

The Cost of Connection

CompuServe was not cheap. During the early 1980s, users often paid $30 per hour to connect, plus $5-6 per hour in additional fees. The service earned the nicknames "CompuSpend" and "Compu$erve."

That expense created something we have lost: users who valued their time online. When every minute costs money, you do not post thoughtlessly. You do not engage in flame wars for entertainment.

The forums reflected this. Discussions were substantive. People asked real questions and gave real answers. The conversations that survive in archives show a level of depth rare on modern platforms.

Scarcity imposed discipline. When we removed that scarcity, we got abundance - but abundance of low-quality interaction. The FidoNet networks operated under similar constraints. They similarly produced communities that felt more purposeful.

What CompuServe Invented

Some things we take for granted today originated on CompuServe:

The GIF. In 1987, CompuServe introduced the Graphics Interchange Format. They needed a way to compress and share images efficiently over slow modems. The format they created is still used billions of times daily.

Consumer email. Before CompuServe, email was for academics and corporate users. CompuServe made it accessible to regular people and connected it to the broader internet early.

Online forums as we know them. The board-based discussion format - topics, threads, replies - was refined on CompuServe. Every forum platform since has iterated on that basic structure.

Virtual goods and digital content. The file libraries were not just free downloads. Shareware authors distributed their work through CompuServe. It was an early marketplace for digital content.

Why It Died

CompuServe dominated through the 1980s and early 1990s. By 1997, it had been sold to AOL. By 1999, the text-based service was gone. What happened?

Price competition. According to historical records, AOL charged $2.95 per hour versus CompuServe's $5.00. Then AOL switched to monthly subscriptions - unlimited access for a flat fee. CompuServe's per-hour pricing became a competitive disadvantage.

Interface expectations. AOL invested heavily in a graphical client that was free and user-friendly. CompuServe's interface was more powerful but less accessible. As the market expanded, ease of use trumped capability.

The web changed everything. When the World Wide Web arrived, it offered something walled-garden services could not match: open, decentralized access. Anyone could create a website. Anyone could link to anything. CompuServe's curated environment suddenly felt limiting.

The failed catch-up acquisition. In March 1995, CompuServe bought Spry Inc. for $100 million - what the New York Times called "the largest acquisition yet in the Internet business." Spry made "Internet in a Box," one of the first consumer-friendly packages for connecting to the web.

I was working at Spry when the acquisition happened. I watched from the inside as CompuServe hoped Spry's technology would help them compete with AOL and Prodigy. It didn't work. By the time CompuServe integrated Spry's capabilities, the window had closed.

The acquisition became a cautionary tale about trying to buy your way into a market you fundamentally don't understand. I learned more about corporate strategy in those months than in any business class.

As one observer noted: "The burden of trying to support two types of services - text-based and graphical - opened the door for a competitor to do a better job with the next iteration."

Patterns That Persist

Watching CompuServe rise and fall, I see patterns that still apply:

Community quality often inversely correlates with scale. CompuServe forums worked because they were small enough for human moderation. As platforms scale, community health degrades.

Removing friction is not always improvement. The cost and effort required to use CompuServe filtered for committed users. Modern platforms optimize for removing all barriers. That means anyone can participate. That means average quality of participation drops.

Invested moderators outperform algorithms. CompuServe SysOps knew their communities. They made judgment calls based on context. No algorithm can replicate that contextual understanding. The lessons from SysOp-era moderation are still waiting to be relearned.

Walled gardens eventually fall. CompuServe, Prodigy, AOL - all the proprietary services eventually lost to the open web. The pattern suggests today's walled gardens face similar long-term pressures.

CompuServe vs. Web 2.0: What Changed

The SysOp model solved problems the algorithmic model created:

What We Should Remember

CompuServe proved that people want to connect online. They want forums, chat, email, shared content. These desires are universal.

But CompuServe also showed that how you build those connections matters enormously. The same technology can create healthy communities or toxic wastelands, depending on the incentives you put in place.

The people running CompuServe forums were volunteers with names and reputations. The communities they built lasted for years. The discussions were substantive. The relationships that formed were real.

We have better technology now. We have faster connections, richer media, global reach. But I am not convinced we have better communities. What CompuServe understood - that community health requires investment and accountability - seems forgotten in the race for engagement metrics.

"The technology was primitive. The communities were not. That gap should tell us something about where community health comes from."