NetZero Joins 'Broadband-Lite' Club

As Internet access becomes more commoditized, a no-frills provider looks to elongate the dialup lifecycle with a speedier surfing experience.

by Erin Joyce Managing Editor of www.atnewyork.com [April 4, 2003]

Low-cost ISP NetZero has joined its competitor Earthlink in rolling out a new, broadband-like dialup service the promises a faster surfing experience.

But unlike Earthlink's $28.95 per month price for a faster dialup service (powered by Propel) that it unveiled last week, NetZero's HiSpeed service costs $14.95 for the same claim of a surfing experience up to five times faster than a standard 56 Kbps dialup connection.

Mark Goldston, CEO and president of United Online, the parent company of NetZero, said despite the increasing number of U.S. households moving to adopt broadband, a significant portion of the online population is either put off by broadband's higher monthly price range of $40 to $55 or live where broadband still is not available.

That's part of the reason that NetZero is rolling out the tiered service to go with its standard, $9.95 per month no-frills access.

Goldston said for the most part, broadband subscribers still use their connection the same way they used dialup—to check e-mail and surf the Web pages at a higher speed.

For those not interested in downloading music files or other bandwidth intensive functions such as streaming video, a "broadband-like" experience on a dialup connection may be ideal, Goldston said.

"We think there are a lot of speed fanatics who would go for this, allowing them to experience a broadband-like online session, without the downloading, for a small change in price," he said.

Meanwhile, as Internet access becomes increasingly commoditized as a service, forcing some providers to offer value-added services such as content and bundled software services, NetZero is sticking to its roots as a low-cost, no-frills access provider.

"What we want to do is elongate the lifecycle of our dialup base," said Goldston. "And number two, to make dialup much more relevant to surfers who want more speed. The great majority of people using broadband now are not people who download a lot of files."

The "HiSpeed" service isn't necessarily offering a faster data transmission rate than usual dialup speeds, the company said. NetZero's HiSpeed uses compression and caching technologies that squeeze text and graphics in order to speed loading time of Web pages.

The HiSpeed service also includes a small "speedometer" on the user's screen which lets them know their dialup session is being accelerated.

According to Jupiter Research (whose parent company also owns this publication), the broadband population is expected to reach about 21 million by the end of 2003, up from 17 million U.S. households with broadband access. The U.S. dialup population is estimated at just over 40 million.

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