By Kevin Murphy
America Online Inc’s UK operation will announce on Thursday that it is to respond to falling market share by offering an internet access service where consumers pay a monthly subscription fee, but no per-minute dial-up charges. The move follows months of speculation on how AOL would confront the current wave of subscription-free internet service providers.
Freeserve from Dixons Group Plc, AOL’s usurper as largest UK ISP, redefined internet access by offering it subscription-free and covering costs with a slice of dial-up call revenues. AOL has constantly denied it would jump on the bandwagon, and now will gain the free marketing tag from the opposite direction. It will charge a monthly subscription of 14.99 pounds ($24) for unlimited access via an 0800-prefix free-phone number.
Start-up CDs for the service have been sent to a limited number of randomly selected households, to measure response to the offering. A spokesperson for AOL confirmed that subject to the trial being successful, the service will soon become widely available, pointing out that most internet users spend more on phone calls than subscription fees.
