I'm not particularly surprised by the move. AOL has been having trouble as its dialup base continues to move on to Cable/DSL packages. (DSL is available for
$10/mo in some areas of the US, the same price as AOL dial) Advertising is keeping the company afloat, but it needed to cut some weight.
The question now is where to go from here...
Many high-speed providers quietly offer personal web hosting as part of their service. (ex.
Comcast) This kind of offering is a great replacement for either AOL Hometown or AOL FTP hosting. Usually its ad-free and costs nothing in addition to your regular service fees.
The free hosting market is still around, though the insane ad-free hosts of yesteryear are long gone.
Geocities,
Tripod (
UK), and
Freeservers are among the older hosts still offering free hosting. Their offerings are comparable to AOL Hometown's level of service. Many smaller free web hosts can easily be found with a quick search.
Refugees from the ad-free AOL FTP hosting (members.aol.com) will either have to deal with advertising (above) or part with some cash.
Doteasy provides a similar level of service to AOL's FTP hosting, costs $25/yr for a domain, which includes "free" hosting.
NearlyFreeSpech.NET offers pay-per-megabyte hosting, a simple low traffic site can run for over a year for less than a dollar. (Domain not included, may need some technical know-how for setup, but great for power users)
R.I.P. AOL Hosting... The final days of a decade-old service. Hope that other AOL refugees are able to find suitable new homes for their pages.