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Verizon Picks InfoSpace to Power Portal

Verizon Communications Friday launched its Verizon Wireless Web portal featuring InfoSpace Inc. content and shopping services.

Integrating InfoSpace's wireless infrastructure into Verizon's mobile Web services allows customers to e-shop, access information and manage their Internet experience over a Verizon Wireless-powered cellular phone.

Marc Lefar, Verizon Wireless staff vice president, said it is using InfoSpace's platform and integrated suite of services because it allows Verizon to provide our customers with localized and customized mobile services.

"There is a strong and growing consumer demand for these services," Lefar said. "The flexibility and scalability of InfoSpace's services adds real value to our service, driving our users to rely on their wireless phone as the ultimate source of information; anytime, any place and on any device."

Naveen Jain, InfoSpace founder and chairman, said its partnership with Verizon Wireless would help maintain customer loyalty for the mobile communications firm.

"InfoSpace's wide range of wireless services and the flexibility of our platform make our infrastructure the first choice for carriers," Jain said. "This partnership will empower Verizon Wireless to provide its users with next-generation services that will help it create a long term relationship with its mobile customers."

Mobile Web is a nationwide service providing users access to the Web-based information they seek over wireless handsets. Mobile Web is designed to meet each user's specific personal and business preferences and allows each user to customize access from a handset, or through Verizon Wireless' new portal.

High-tech market research firm Cahners In-Stat Group predicts that wireless penetration will more than double over the next 5 years. However, annual wireless churn rates have increased 4 percent in the last year and will continue to rise if wireless providers do not focus on customer retention issues.

Ken Hyers, In-Stat Wireless Strategies Service analyst, said it's debatable whether carriers are sufficiently aware of the problem that churn presents, as it is not high on the priority list of upper level management.

"For most, the priority is to maintain high customer acquisition rates, often at the expense of customer retention, even when the cost to keep a current customer is a fraction of that to acquire a new one," Hyers said.

Those wireless service providers that are aware of churn and are willing to combat its effects have several choices. Friday's deal is an attempt to solve customer retention issues by offering both local and personal Web solutions.

In-Stat found that due to high customer acquisition costs, as well as continuing support and service costs, current average billing rates typically do not allow carriers to make a profit from customers during the first year.

Taking a proactive approach is one of the most effective ways for wireless companies to combat churn. Marketing campaigns aimed at reaching customers before they switch to another carrier can minimize customer attrition.

Verizon Wireless is one of the largest wireless communications providers in the U.S. with more than 25 million wireless voice and data customers and nearly 4 million paging customers.

The new coast-to-coast wireless provider was formed by the combination of the U.S. wireless businesses of Bell Atlantic Corp. and GTE Corp., among other companies. Verizon operates a wireless footprint covering nearly 90 percent of the U.S. population.