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July 20, 1998

JUNO ADDS FEE-BASED WEB & EMAIL TO TAKE ON AOL

By CBR Staff Writer

Juno Online Services LP, the free email-only service provider that has amassed some 5.5 million ‘subscribers’ in just over two years, will tomorrow introduce its first fee-based service for enhanced email and full web access. Until now all the company’s revenues have come from advertising. The company will charge $2.95 per month for its Juno Gold enhanced email service, which primarily adds the ability to send attachments of various kinds, and $20 per month for web access. Company founder and president Charles Ardai said those prices will be the high-point and Juno plans various offers to bring those prices down. He also said the company may experience with meter-based usage plans, depending on customer response. The company has also struck up an alliance with Lycos Inc for it to provide a search engine and other content exclusively to a co- branded site (home.juno.com) through which all Juno access will be directed. This means yet another entrant to the crowded web portal site, and sets up Juno as a direct rival to the number one online service provider, America Online Inc, which currently boasts some 12 million subscribers and charges $22 a month for unlimited access. However, Ardai says Juno is not trying to start a price war. Even though, by Juno’s own calculations, some 42% of its existing subscribers that use its text-based email service already have web access, the company plans to market the new service first to its existing subscriber base before trying to go after new subscribers, in a move that could start as early as the end of this year with advertising in the traditional media. Juno prides itself on its ease of use, and it will use the interface to entice users to sign up to the fee-based service. For instance, within the new basic Juno interface, an attachment button is included and users who click on it but are not Juno Gold subscribers, will be invited to join – otherwise they cannot send attachments. Similarly, in addition to the two large ‘read’ and ‘write’ tags on the email interface, Juno has added a ‘web’ tag that will inform non-paying subscribers about the benefits of signing up for $20 a month. Juno currently has signed up more than 150 advertisers since its inception, who get access to the detailed demographic information users are required to submit when they subscribe. It also has a few AOL-style exclusive marketing deals, such as one with Bank of America, which is the exclusive marketer of credit cards and Qwest/LCI, for long distance services. Juno outsources all of its network operations to companies including Concentric Networks Inc, Sprint Corp, and various divisions of WorldCom Inc, including CompuServe Network Services and UUNet Technologies. It has more than 1,200 local dial-up PoPs nationwide.

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