FreeDSL Goes To New England

Winfire Inc., is making good on its
promise to deliver FreeDSL to 30,000 thrifty digital subscriber line
customers in the New England region Monday.

A unique five-year wholesale agreement signed with Verizon Communications gives FreeDSL
subscribers, who signed up for the service earlier this year, from Maine to
Virginia a low-cost alternative to the often-pricey DSL service.

The specifics of the agreement, which Winfire officials declined to
elaborate on, puts a Verizon icon on all FreeDSL toolbars
in the telco’s coverage area. The link takes members to a pre-determined
site offering telephony and Internet services.

Ryan Steelberg, president and co-chief executive officer, said the
agreement positions the company for its nationwide deployment of DSL services.

“Our expansion into Verizon’s Northeast region brings us significantly
closer to creating the leading, consumer broadband network, offering
Internet access, content, Bandwidth-on-Demand and self-installation
services, to name a few,” Steelberg said. “We look forward to working with
Verizon in the Northeastern United States and eventually in other prominent
market regions.”

To that end, Winfire has entered similar agreements with other regional
Bell operating centers (RBOCs), to be announced later this year.

According to Bill Karambelis, Winfire executive vice president of network
operations, this agreement and the upcoming announcements will give Winfire
and its FreeDSL service a major U.S. network footprint.

“I can’t disclose the companies we’ve made arrangements with, those will be
announced later, but they will be to everyone’s mutual benefit,” Karambelis
said. “All told, it will give us coverage throughout more than half the
country.”

The wholesale agreement requires Winfire to pay for the cost of 30,000 DSL
lines by the end of the year. Terms for the subsequent four years were not
available.

Verizon, and other RBOCs, impose stiff penalties to Internet service
providers and competitive local exchange carriers who can’t sell the
minimum number of DSL lines required in the contract.

Officials on both sides don’t expect problems fulfilling the
contract. Signup registration for FreeDSL services, which began last year,
netted 55,000 potential subscribers in the New England area alone. Winfire
officials expect to pick up the last 20,000 or so registered FreeDSL users
early next year.

Winfire is an “upsell” ISP, hooking customers with its free Internet
services in the hopes they will sign on for faster, premium
services. Winfire’s top-of-the-line service, with download speeds up to
1.54Mbps, comes at a price tag lower than most DSL provider’s basic
packages at $34.95. For example, the basic DSL service provided by Verizon
starts at $39.95 a month.

Juno Online Services Inc.,
originated the upsell model, taking its free dialup
Internet service with premium upgrades and netting 3.38 million active
subscribers nationwide, making it the third largest
ISP in the U.S.

The hope by many DSL providers is to acquire a huge customer base as
quickly as possible. Current trends indicate consumers stay with their
first DSL provider, due to the more complicated (than dialup Internet
access) setup process.

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