United Online to Offer High-Speed Access

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Comcast Corp. and United Online Inc. said yesterday they have inked a deal under which United Online will offer high-speed Internet access through the Comcast cable system.


The deal marks the first time United Online will offer high-speed access and Comcast will offer a choice of ISPs.


The agreement, financial terms of which were not disclosed, will make high-speed access available to Comcast customers in Nashville, TN, and Indianapolis within 90 days, according to a joint statement. The two markets, in which Comcast claims 467,000 cable subscribers and 77,000 high-speed Internet users, will provide a "template for a subsequent national rollout of United Online's Internet service to anyone who can get Comcast cable," the statement said.


Also under the agreement, United Online, Westlake Village, CA, will promote Juno and NetZero on the Comcast cable system and through links on Comcast.net.


Comcast claims to be the third-largest cable operator in the United States, with 8.4 million subscribers. It already offers high-speed Internet access through its own ISP, Comcast High-Speed Internet, to 950,000 subscribers.


"Until about two months ago, Comcast was bound to a single Internet service provider," Brian L. Roberts, president of Comcast, said in the statement. The agreement is not exclusive and does not preclude Comcast from making other ISPs available to its subscribers.


United Online, which was created by the merger of competing ISPs NetZero and Juno last year, claims 5.6 million dial-up users, 1.46 million of which are billable subscribers.


United Online claimed in the statement that it has been reluctant to enter the broadband market because the return didn't justify the investment.


The company was looking for a deal under which it would be a marketing rather than an infrastructure partner, according to a Reuters report.


"We ... believe the agreement will allow us to generate per-user gross profits at or in excess of our current billable dial-up offerings," said Mark R. Goldston, chairman/president/CEO of United Online.


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