Competition's demise spurs AOL price hike
June 3, 2001
By JIM BROOKS
Just a few years ago, the growing number of free Internet access
providers had some analysts wondering aloud if fee-based Internet
providers -- like America Online and Earthlink -- were going to
survive the storm.
Fortunately for the fee-based Internet providers, the free Internet
trend, while popular with consumers, didn't hold up as a profitable
business model.
Since the all virtually depended on advertising to pay for access,
the downturn in Internet advertising pushed most of them into
bankruptcy or forced them to begin charging for the Internet access
they provide.
One of the first free providers, Juno, is left standing in the field
while it too searches for a way to make money.
On the heels of the failure of the "free Internet"
movement, America Online recently raised the price for access to its
service by nine percent to $23.90 for unlimited dial-up access. The
new price begins with the July billing cycle.
With the free services no longer a threat, AOL has the power to raise
the price its 30 million subscribers pay each month. The move is
expected to boost subscriber revenues by $200 million this year and
by $430 million next year.
Juno actually led the pack in the rate hikes; it raised the price it
charges for its premium service from $9.95 to $14.95 earlier this year.
Another freebie innovator, NetZero, offers a premium dial-up Internet
access plan for $9.95 as well.
Both Juno and NetZero offer free Internet access, but both have cut
back on the number of hours users get to spend online.
WAL-MART.COM. Speaking of dial-up Internet access, the
nation's No. 1 retailer, Wal-Mart, will roll out its own branded
Internet access service, pricing unlimited access for $9.95 a month.
The plan for the service, to be called Wal-Mart Connect, has been in
the works for some time.
Wal-Mart signed an alliance with AOL in 1999, and had planned at
first to rollout its branded Internet access more than a year ago.
The Wal-Mart service is a branded version of the CompuServe Internet
access service, which is owned by AOL.
As a tie-in to bring in new revenue, Wal-Mart plans to merge its
clicks with Wal-Mart bricks. Customers will be able to go online to
do things like refill prescriptions they can pick up at their local
Wal-Mart store.
For more details, visit www.walmart.com.
DSL VS. CABLE. High-speed Internet access is a service still
out of reach of many Internet users -- either by price or by physical location.
Statistics show that the majority of broadband users in North America
access the Internet through a cable TV provider.
Seventy percent of broadband users use cable; the rest use DSL.
The next price war among Internet providers may be between DSL and
cable Internet providers as each tries to gain market share over the other.
In areas with both services, it will be interesting to see how the
services stack up over the long haul.
One analyst predicts that DSL will see significant growth in the near
future as the technology and the Baby Bells go through a few growing pains.
In my mind, the winner will be whichever business can presents a
service with good value and customer service -- just like any other
successful business venture.
HOAX HITS. A hoax warning distributed via e-mail about a virus
called Sulfnbk.exe reportedly has created considerable concern.
The warning, which reportedly had its origins in Brazil, has prompted
concerned computer users to delete files from their computer hard drives.
The warning prompted users to look for the file on their computers;
if the file was there it was infected, and they were instructed to
delete it.
The infected file was "timed" to activate on June 1. In
reality, the file is a little-used Microsoft Windows utility, and
deleting it did no real harm to the operating system's ability to function.
The deleted file can be restored from a users original Windows disk
if necessary.
The warning was so ominous that I found myself going to check if the
warning was legitimate.
Users who deleted the file can restore it by following instructions
found at the Symantec Web site. Windows 98 users can simply run the
System File Checker.
For more information, visit www.symantec.com.
REAL VIRUS ALERT. An e-mail promising nude photographs of
Jennifer Lopez is actually bait designed to trick people into opening
a virus attachment -- W95.CIH, also known as the Chernobyl virus.
The Chernobyl virus is more destructive than other viruses that have
been active recently. It tries to destroy Windows executable files,
and is said to attack a computer's Flash BIOS, which could prevent a
computer from booting up.
The virus arrives as an e-mail with the subject, "Where are
you." The message is "This is my pic in the beach" and
the attachment which delivers the payload is JENNIFERLOPEZ_NAKED.JPG.VBS.
The best defense against viruses sent as e-mail attachments is to
treat each one with extreme caution; delete any that you suspect
might be viruses, or weren't expecting from someone. |
