INTERVIEW-AOL service to beat Freeserve in ad revs
August 20, 1999 04:45 AM
By Neal Boudette, European Telecommunications Correspondent
HAMBURG, Germany, Aug 20 (Reuters) - AOL Europe said on Friday its free Internet service in Britain is in position to surge past rival Freeserve Plc in advertising and electronic commerce revenue as soon as it launches next week.
"We already have more revenue lined up than Freeserve generated in its first year," AOL Europe Chief Executive Andreas Schmidt told Reuters in an interview.
The new service, called Netscape Online, will start operations on Tuesday and like Freeserve will charge no monthly fee, leaving users to pay only for the local phone calls for the time they are logged on.
From its start last september to May 1, Freeserve generated 2.73 million pounds ($4.4 million) in advertising and e-commerce revenue.
Netscape Online already has contracts with advertising and electronic commerce partners that are "more than that, by a wide margin," Schmidt said.
Freeserve shook the UK market when it introduced the "free" access concept and shot ahead of AOL in registered users, becoming Britain's largest Internet service provider in only a matter of months.
Netscape Online will lure some of the free Internet users -- mostly young, single men -- who prefer low-priced access over subscription-based services like AOL, Schmidt said.
"This is another brand that we have to go after this particular market," he said.
The company's flagship AOL service is aimed a novices and familes while its Compuserve unit targets business and professional users.
Once Netscape Online up and running the the UK, AOL could easily start new versions for other countries. "The cost would be pretty low. We'd just have to put out Netscape Online CDs and get the local content," Schmidt said. "We could do it almost instantly."
Schmidt would not say where and when Netscape Online would appear next.
AOL Europe is a joint venture of America Online Inc AOL and German media group Bertelsmann AG .
((Frankfurt Newsroom, +49 69 756525, frankfurt.newsroom@reuters.com))
($1=.6167 Pound) REUTERS
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