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United Online to Resell Verizon DSL Under NetZero Brand

7:00 am on November 20, 2006 | Category: Internet, Telecom Services

Discount ISP, United Online, which markets dialup internet access under the Juno and NetZero brand names, has announced plans to offer its own high-speed internet offering by leasing network infrastructure from Verizon Communications.

Long considered one of the more dynamic dialup providers, and famous for poaching the customers of AOL and the big telecom carriers, United Onlineâ€™s broadband announcement is yet another sign that the dialup business is shriveling up.

Now in a very similar situation to AOL, the NetZero and Juno businesses have seen their dialup revenues decline by around 15% in the past 12 months.

EarthLink is one of the few â€œold schoolâ€ ISPs to show any encouraging results in recent months, but this success is coming mostly from its broadband division, whose revenue reached $149.4 million in the third quarter, up 37% compared to last year.

AOL, EarthLink, and other broadband resellers, however, are finding it difficult or impossible to undercut the offerings of big telecom providers. The same will be true of NetZeroâ€™s new service, which offers 1.5 Mpbs broadband service at a cost of $19.95/month for the first six months, and $29.95 for each month thereafter. Verizon also charges $19.95/month, but without the unpleasant price jump.

Ultimately, NetZero DSL probably wonâ€™t pose a serious alternative to Verizonâ€™s cheaper and near-identical service. Instead, it will simply give existing subscribers a way to jump ship on dialup without changing brand names. On that basis, it looks like NetZeroâ€™s long-term success is looking like a difficult proposition indeed.

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