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EarthLink Announces First Rate Hike

For the first time, EarthLink, Inc., raised its basic monthly dial up access charge, from $19.95 to $21.95, officials announced Tuesday.

Aaah...1995, it was a fine year. Here's some highlights from the year the third-largestInternet service provider (ISP) introduced its $19.95 rate plan:

  • The world wide web (WWW) finally surpasses the file transfer protocol (FTP) as the most popular method of downloading information on the Internet.
  • RealAudio made its debut on the Internet, bringing a killer app - streaming media - mainstream.
  • Netscape goes public with the third-largest NASDAQ initial public offering (IPO) Aug. 9.
  • Future nemesis America Online opens its doors for dial up business.
  • Sun introduces Java to an unsuspecting virtual world.
  • The National Science Foundation (NSF), starts charging an annual fee of $50 for domain registration.

A lot has changed in that six years, from great Internet successes like the explosive growth of high-speed Internet service using digital subscriber line (DSL) and cable to great failures like the business-plan-on-a-napkin dot coms that temporarily defied conventional and fiscal wisdom.

The rate hike was an inevitable one, however, for an ISP that needs to add more and more value-add services like instant messaging, personal start pages and global roaming service, and still provide a quality service.

Any lingering questions by EarthLink officials about upsetting new or current customers were answered recently, when AOL announced a rate hike to $23.90 in May. Despite the $1.95 boost, the largest ISP in the world continued to attract customers, and even topped 30 million customers Monday.

The rate hike still gives subscribers a low-cost alternative to AOL and puts EarthLink on par, price-wise, with the Microsoft Network.

In Tuesday's announcement, the ISP introduced its new value-adds to soften the blow of higher rates.

Now, basic plan members get seven extra email boxes and more Web storage space. EarthLink members can now upload multimedia files like digital files on an individual Web page.

For members who want to keep the price of access down, EarthLink is letting them pre-pay for one year's access at a rate of $19.95 a month.

EarthLink, lingering behind AOL and MSN with 3.1 million subscribers, will start charging the new rate July 2 for new customers and Aug. 1 for its existing customer base.

EarthLink, although it has kept its basic service at $19.95, has also been offering a premium service to its members for years. Dubbed EarthLink Gold, the $28.90 monthly service promises priority technical support for its preferred subscribers.

Officials were not available for comment on whether it would increase the monthly rate for its EarthLink Gold customers.