A lot! I don't remember the total spending but do recall in the early 1990s our target was to spend 10% of lifetime revenue to get a new subscriber. At that time I believe the average subscriber life was about 25 months and revenue was about $350 so we spent about $35 to acquire subscribers. As we were able to lower the cost of disks/trial/etc we were able to ramp up marketing. (Plus, we knew Microsoft was coming and it was never going to be easier or cheaper to get market share.) When we went public in 1992 we had less than 200,000 subscribers; a decade later the number was in the 25 million range. That helped drive our market capitalization up from $70 million at the time of the IPO to $150 billion when we decided to combine with Time Warner to accelerate our transition to broadband and diversify our revenue mix.

When we launched AOL 4.0 in 1998, AOL used ALL of the world-wide CD production for several weeks.  Think of that.  Not a single music CD or Microsoft CD was produced during those weeks.  I still remember hand delivering the Golden Master to Lisa in Marketing.

When people complained about receiving AOL CDs even though they already had an AOL account, Steve Case would ask, "don't you have a friend you could give it to?" 

AOL was the only major brand built with direct marketing.  Major kudos to Jan Brandt and her team.  They knew which words and colors were the most effective.  And they were constantly trying to best their previous efforts.  The Tide-colored CD marketing piece was the champion for a long time.  People kept popping them in computers and signing up.

Before AOL 4.0 there were roughly 8 million members and just a year later there were 16 million.  The stock jumped up that year.

Over $300 million  :-)   At one point, 50% of the CD's produced worldwide had an AOL logo on it.  We were logging in new subscribers at the rate of one every six seconds.

Due to the way AOL accounted for this marketing tactic in the mid 90s, it should actually be possible get some exact figures for this if you can find their financial statements. An accounting rule related to direct marketing stated that if a company could reasonably estimate the response rate of a direct marketing initiative based on historical data, it could categorize those costs as an asset, not an expense. AOL adopted this accounting process for its direct mail program and booked all direct mail marketing expenses as an asset called "deferred subscriber acquisition costs".

Of course, AOL's historical response rate was not maintained over the next few years (I believe due to increased competition as Steve alluded to), and that deferred subscriber acquisition cost asset account ballooned to over $300 million by 1996. When AOL reversed accounting procedure and started accounting for the direct mail program as an expense, I know they incurred a $385 million one-time charge in 1996, which was larger than all previous accounting profits of the company. So we're talking a lot of dollars here. The $385 million is not an accurate number for the direct mail costs though due to AOL having already amortized significant parts of the account. How off it is though I don't know.

I couldn't find a complete set of financial statements for AOL from the mid 90s, but I believe if you can find the financial statements, you can track use that data plus the amortization schedule and response rate data from the notes to compute the exact numbers. I'm not an accountant though. It'd be nice if someone could confirm.

Short answer: over $300 million
 
AOL's Deferred Subscriber Acquisition Cost
 
($ millions)                    1996   1995    1994   1993
Revenue                       1094     394      116       52
Operating Income             65      (21)     4.2       1.7
Net Income                       30      (36)     2.2       1.4
Total assets                   959       405    155     39.3
Deferred subscriber 314      77.2     26.0    -
   acquisition costs
 
Marketing and solicitation costs are normal operating expenses and until 1994 AOL treated its solicitation costs for new customers as an expense called 'deferred subscriber acquisition costs' (DSAC).
 
As shown in table above, AOL initially capitalized $26 million. DSAC grew dramatically over the next few years. Had these costs been expensed as incurred instead of being capitalized, AOL would have reported a loss for each period.
 
The Securities and Exchange Commission (SEC) disagreed with AOL's treatment of capiltalizing costs. Specifically, AOL failed to meet requirements of SOP 93-7 because unstable business environment precluded reliable forecasts of future net revenues as Steve alluded to above.

Adding to this... Compuserve (acquired by AOL) founder Jeff Wilkins threw out the factoid in a Business First event last fall that (at the time) they consumed 40% of the world's capacity to produce CD-ROMs. If memory serves he indicated that they basically bought a portion of everyone's capacity -- so the relative scale of the effort wasn't easy to spot (and they weren't too reliant on one supplier).

Several answers have mentioned the SEC case against AOL for how they accounted for the CD costs. Here it is: Securities Exchange Act of 1934 Release No. 42781

United States of America
Before the
Securities and Exchange Commission

Securities Exchange Act of 1934
Release No. 42781 / May 15,2000
Accounting and Auditing Enforcement
Release No. 1257 / May 15, 2000
Administrative Procee