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AOL Europe commits to free access in Britain
Copyright © 1999 Nando Media
Copyright © 1999 Reuters News Service
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By RICHARD MEARES
LONDON (July 19, 1999 7:43 a.m. EDT nandotimes.com) - AOL Europe, surpassed this year as Britain's biggest Internet service provider by no-charge rival Freeserve, said Monday it would launch a free service of its own next month.
AOL Europe, a joint venture of America Online and Germany's Bertelsmann, said the service would be called Netscape Online and launched in mid-August.
It said it would complement its flagship AOL and CompuServe brands in Britain, where Freeserve, launched last year by electrical retailer Dixons Group PLC, has pioneered a revolutionary shift toward subscription-free services.
AOL Europe's current services are paid for by a monthly charge equivalent to several dollars.
On top of that, users pay for local telephone calls which in Britain are metered by the minute.
AOL said Netscape Online was aimed at the "value" sector of the Internet market, catering for the price-conscious consumer who was more likely to be young, male and single than AOL UK's core audience.
"The launch of Netscape Online for the 'value' market will complement our full-featured, premium AOL brand for the mainstream, family market and CompuServe brand for the professional market," said AOL Europe President Andreas Schmidt.
"These brands collectively will have the cricital mass necessary to generate substantial advertising and commerce revenues."
Freeserve, now Britain's biggest Internet service provider, plans to sell off a fifth of its shares this month in the country's first major Internet flotation that will value it at 1.3 to 1.5 billion pounds ($2.0 to $2.3 billion).
Its 1.3 million users - Freeserve's main asset - have a price tag of about 1,000 pounds a head.
Dixons' shares were down three pence at 14.18 pounds by 0900 GMT.
Scores of copycat no-subscription providers, often based on famous British brand names from newspapers to football clubs, have raced into the market since Freeserve was launched late last year.
Providers with no monthly charge are now taking off in other parts of Europe too, saying they hope to make their money from a share of telephone call charges, from advertising and from electronic commerce.
AOL has around a million subscribers in Britain - including some 400,000 signed up to CompuServe - and some 20 million worldwide.
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