General Motors Signs Strategic Alliance With NetZero
DETROIT, Jan. 13 /PRNewswire/ -- General Motors Corporation (NYSE: GM) and NetZero, Inc. (Nasdaq: NZRO), the nation's largest provider of free Internet access based on number of registered users, today announced a four-year strategic alliance. As part of this agreement, GM will be the premier automotive partner on NetZero's unique navigational tool, The ZeroPort(TM), as well as the exclusive auto content provider for NetZero's upcoming personalized Webpage -- ClubZero(TM).
As the premier automotive partner on The ZeroPort, NetZero users will be able to access GM Buypower, which offers prospective purchasers the ability to configure their exact vehicle while providing access to dealer inventory information directly. GM and NetZero also will be developing one-to-one marketing programs that will allow GM and its dealer network to further understand and anticipate products and services for today's consumers. Additionally, the agreement includes provisions for GM to distribute a co- branded version of the NetZero free Internet access service through various GM marketing channels.
"The NetZero partnership is another critical step forward in GM's e- strategy and builds on our already strong online consumer connection," said Mark Hogan, president e-GM, GM's e-commerce business unit. "NetZero's technology and consumer scope brings GM closer to realizing its goal of revolutionizing consumers' auto experiences -- from the information gathering phase to the purchasing phase and throughout the entire ownership lifecycle."
"Our partnership with General Motors demonstrates the increased influence of the Internet on one of America's most established consumer goods manufacturers," said Mark R. Goldston, chairman and chief executive officer, NetZero. "We are thrilled that GM is planning to utilize virtually every advertising and targeting product that NetZero offers. We believe this reflects the increasing recognition of NetZero as one of the country's premier interactive services companies."
Providing NetZero fulfills certain performance criteria, the base agreement could represent $68 million in revenue to NetZero over the next four years, with up to $8 million occurring in the first year of the contract. GM also has the option to purchase up to $35 million in additional services from NetZero, making the total potential revenues from the agreement up to approximately $100 million. NetZero anticipates that revenues will increase over the term of the agreement with a larger portion of the potential sales to occur in the latter years. In addition, GM is receiving a warrant that entitles it to purchase up to 575,000 shares of NetZero common stock at $28.71 per share. About e-GM
e-GM, a business unit launched by General Motors (www.gm.com ) in August 1999, seeks to integrate e-commerce efforts throughout GM's traditional business units and employ new technologies that will enhance the customer experience, while improving efficiency. e-GM leverages GM's core competencies in information technology, including OnStar, to create a new class of applications for vehicle, office, and home. About NetZero
NetZero is pioneering a new Internet services model that provides consumers with free access to the Internet while offering online advertisers an effective way to target those users. NetZero offers consumers free and unlimited nationwide Internet access, free email and navigational tools through The ZeroPort. The ZeroPort is a persistent on-screen device which serves as a navigational tool providing users with instant "speed dial" to key sites on the Internet for functions such as shopping, auction, and e-commerce services.
Users can even access essential features such as search, email and browse, all without having to launch their browser. Customized information such as stocks, news and sports can also be delivered directly to the desktop through The ZeroPort. For advertisers, NetZero utilizes it proprietary zCast technology to provide unique one-to-one targeting capabilities and the ability to track users throughout their online experience. Between the October 1998 launch of NetZero and early January 2000, approximately three million users registered for its free Internet access service. NetZero offers its services in more than 2,000 cities across the United States.
This announcement may contain forward-looking statements that involve risks and uncertainties. Actual results may differ materially from the results predicted and reported results should not be considered as an indication of future performance. The potential risks and uncertainties include, among others, NetZero's ability to fulfill performance criteria and other contractual obligations, and to generate revenues under the agreement with General Motors; NetZero's unproven business model and limited operating history; the company's ability to grow its user base, generate advertising revenues and decrease telecommunications costs; the effects of competition for users and advertisers; the loss of key customers; technological problems or developments; and governmental regulation. More information about potential factors that could affect the company's business and financial results is included in the company's Form 10-Q and other filings with the Securities and Exchange Commission (http://www.sec.gov) including (without limitation) information under the captions "Management's Discussion and Analysis of Financial Condition and Results of Operations" and "Risk Factors." NetZero(TM), Defenders of the Free World(TM), the NetZero logo, zCast(TM) and The ZeroPort(TM) are trademarks of NetZero, Inc. All other names are trademarks and/or registered trademarks of their respective owners.
/CONTACT: Patrick Morrissey of General Motors, 313-665-3176; or Edie Kissko, 213-623-4200, for NetZero/ |
